However, when you want to make international comparisons the most effective method is the method of purchasing power parity. Other methods using the exchange rate usually suffer biases due to speculation in the foreign exchange market or exchange rate policies.
A successful organisation will not only understand existing factors but also forecast change, so that it can take advantage of change within the environments in which it operates. Macro Environment — This contains external forces that an organisation can't directly control, instead organisations need to manage their macro environment in a way that benefits them.
Micro Environment - This is made up of internal factors which means that the organisation is able to control their micro environment.
To learn more about the micro environment and marketing click on this link Micro Environment. The diagram below shows the 4 components of PEST Analysis; political, economical, social and technological.
Political factors influence organisations in many ways. Political factors can create advantages and opportunities for organisations. Conversely they can place obligations and duties on organisations.
Political factors include the following types of instrument: Legislation such as the minimum wage or anti discrimination laws. Voluntary codes and practices Trade agreements, tariffs or restrictions Tax levies and tax breaks Type of government regime e.
Ineffective voluntary codes and practices will often lead to governments introducing legislation to regulate the activities covered by the codes and practices.
All businesses are affected by national and global economic factors. National and global interest rates and fiscal policy is set around economic conditions. The climate of the economy dictates how consumers, suppliers and other organisational stakeholders such as suppliers and creditors behave within society.
An economy undergoing recession will have high unemployment, low spending power and low stakeholder confidence. A successful organisation will respond to economic conditions and stakeholder behaviour. Furthermore organisations will need to review the impact economic conditions are having on their competitors and respond accordingly.
In the current business world, organisations are affected by economies throughout the world and not just the countries in which they are based or operate from. Cheaper labour in developing countries affects the competitiveness of products from developed countries.
A truly global player has to be aware of economic conditions across all borders and needs to ensure that it employs strategies that protect and promote its business through economic conditions throughout the world. Social The third aspect of PEST focuses its attention on forces within society such as family, friends, colleagues, neighbours and the media.
Social forces affect our attitudes, interests and opinions. These forces shape who we are as people, the way we behave and ultimately what we purchase.
For example within the UK people's attitudes are changing towards their diet and health. As a result the UK is seeing an increase in the number of people joining fitness clubs and a massive growth for the demand of organic food. Products such as Fitbit attempt to deal with society's concern, about lack of exercise.
Population changes also have a direct impact on organisations. Changes in the structure of a population will affect the supply and demand of goods and services within an economy.
Falling birth rates will result in decreased demand and greater competition as the number of consumers fall. Conversely an increase in the global population and world food shortage predictions are currently leading to calls for greater investment in food production.
Due to food shortages African countries such as Uganda are reconsidered their rejection of genetically modified foods. In summary organisations must be able to offer products and services that aim to complement and benefit people's lifestyle and behaviour.
If organisations do not respond to changes in society they will lose market share and demand for their products and services.Jun 30, · Economists generally agree that economic development and growth are influenced by four factors: human resources, physical capital, natural resources and technology.
Generally, the economic growth of a country is adversely affected when there is a sharp rise in the prices of goods and services. [paywall] Following are some of the important factors that affect the economic growth of a country: (a) Human Resource: Refers to one of the most important determinant of economic growth of a country.
Zada () studied the factors affecting exchange rate of Pakistan for the period to The study used multiple regression model in which exchange rate was taken as dependent variable while Inflation, interest rate, Foreign exchange reserves, trade balance, money supply and Gross Domestic Product were the independent variables.
Political. The first element of a PEST analysis is a study of political factors. Political factors influence organisations in many ways. Political factors can create advantages and opportunities for organisations.
our rate of economic growth and how best to accelerate it. During But we can at least identify the major factors." Factors Affecting Man-Hours Worked Factors that affect the volume of man-hours worked, or the economic and industrial achievements have occurred largely within. The birth rate (technically, births/population rate) is the total number of live births per 1, in a population in a year or period. The rate of births in a population is calculated in several ways: live births from a universal registration system for births, deaths, and marriages; population counts from a census, and estimation through specialized demographic techniques. Jun 30, · Economists generally agree that economic development and growth are influenced by four factors: human resources, physical capital, natural resources and technology.
Tariffs revision designed to cure trade deficits have become a live and contentious economic policy issue. Despite the ripples it creates, confronting the trade deficit is long overdue given its importance to such things as reducing the economy’s growth rate, and .
1. Introduction. Research evidence suggests that globally, health care personnel in public hospitals work under appalling conditions. However, there is dearth of research reviews that address the factors affecting working conditions in public hospitals.