210774711-Pestle-Final

Pestle & Demographic Analysis-Meaning Meaning of Pestle Analysis • PESTLE stands for - Political, Economic, Sociological, Technological, Legal, Environmental The term PESTLE has been used regularly in the last 10 years and its true history is difficult to establish Various other similar acronyms have been used including ETPS, STEP, PEST, and STEEPLE The term PESTLE is particularly popular on HR and introductory marketing courses in the UK • PESTLE analysis is in effect an audit of an organisation's environmental influences with the purpose of using this information to guide strategic decision-making The assumption is that if the organisation is able to audit its current environment and assess potential changes, it will be better placed than its competitors to respond to changes • To help make decisions and to plan for future events, organisations need to understand the wider ‘meso-economic’ and ‘macro-economic’ environments in which they operate (The meso-economic environment is the one in which we operate and have limited influence or impact, the macro-environment includes all factors that influence an organisation but are out of its direct control) An organisation on its own cannot affect these factors, nor can these factors directly affect the profitability of an organisation But by understanding these environments, it is possible to take the advantage to maximise the opportunities and minimise the threats to the organisation Conducting a strategic analysis entails scanning these economic environments to detect and understand the broad, long term trends Page • A PESTLE analysis is a useful tool for understanding the ‘big picture’ of the environment in which an organisation is operating Specifically a PESTLE analysis is a useful tool for understanding risks associated with market (the need for a product or service) growth or decline, and as such the position, potential and direction for an individual business or organisation • A PESTLE analysis is often used as a generic 'orientation' tool, finding out where an organisation or product is in the context of what is happening outside that will at some point affect what is happening inside an organisation The six elements form a framework for reviewing a situation, and can also be used to review a strategy or position, direction of a company, a marketing proposition, or idea Meaning of Demographic Analysis Demographic analysis includes the sets of methods that allow us to measure the dimensions and dynamics of populations These methods have primarily been developed to study human populations, but are extended to a variety of areas where researchers want to know how populations of social actors can change across time through processes of birth, death, and migration In the context of human biological populations, demographic analysis uses administrative records to develop an independent estimate of the population Demographic analysis estimates are often considered a reliable standard for judging the accuracy of the census information gathered at any time In the labor force, demographic analysis is used to estimate sizes and flows of populations of workers; in population ecology the focus is on the birth, Page death and movement of firms and institutional forms Demographic analysis is used in a wide variety of contexts For example, it is often used in business plans, to describe the population connected to the geographic location of the business Demographic analysis is usually abbreviated as DA For the 2010 U.S Census, The U.S Census Bureau has expanded its DA categories Also as part of the 2010 U.S Census, DA now also includes comparative analysis between independent housing estimates, and census address lists at different key time points Page Introduction to South Korea • South Korea officially the Republic of Korea is a sovereign country located in the southern part of the Korean Peninsula • Total area of 99,392 km2 (38,375 sq mi)[8] and has a population of 50 million • The capital and largest city is Seoul, with a population of 9.8 million • South Korea is a member of the United Nations, WTO Current President of South Korea is Park Geun Hye from Feb 2013 Page Pestle Analysis • Political Analysis South Korea had a turbulent political past, characterized by frequent changes in government, little political freedom and military coups However, in 1986 the democratic process was streamlined and the president was vested with maximum power Due to the centralization of authority, policy making became straight forward The president is the chairman of all the committees, which makes it very easy to co-ordinate and run the whole system The country also has strong political and economic support from the US Although South Korea has been a democracy for over two decades, the military continues to wield considerable power There is a high-degree of political violence in the country and relations with North Korea continue to be tense This is costing South Korea both economically and politically There have been frequent summits between the two countries; however they have so far failed to reach a consensus Current strengths ▪ Centralization of power Current challenges ▪ Military influence in South Korean Future prospects ▪ Confidence building measures with North politics Future risks ▪ Uneasy relationship with North Korea Page Current Strengths Centralization of Power In South Korea, the president plays a key role in both the economy and polity of the country The president is the head of state, head of government and chief of the armed forces The president has the power to execute and amend any laws or policies of the country He also has the power to dissolve the national assembly Due to the centralization of power in the hands of the president, he has to regulate and solve all administrative issues All the committees in South Korea are headed by the president and are known as presidential committees This makes it very favorable in terms of consistency and mutual co-operation and interdependence among various national and state bodies The new president, Lee Myung- Bak, has created the ‘Korea 747 Vision’, a policy completely focused on all round economic development He aims to expand growth to 7% and double per capita income to $40,000 One of the policy's most ambitious aims is to make the country the seventh largest economy in the world in a decade’s time Strong Foreign Relationships After the Japanese–Korean War ended in 1945, it was the US which turned the country's economic fortunes around As a result, the country’s relationship with the US remains very firm, and South Korea concluded a free trade agreement with the US in June 2007 The US military troops stationed in the country provide support to the South Korean army, as relations with North Korea continue to be volatile Furthermore, the country also Page has very strong ties with China, Japan and Russia South Korea has been a member of the United Nations since 1991 and has diplomatic relations with almost 170 countries The former foreign minister Ban Ki-moon is presently the Secretary General of the United Nations, which is likely to help the country improve relations with North Korea, and also strengthen ties with other nations Current Challenges Military Influence in South Korean Politics The military staged coups in 1961 and 1980 and it continues to influence political decisions and policies Although 1986 saw the direct election of a president formulated by the constitution, the constant military threat posed by North Korea means that military leaders still exert considerable influence over the country's political decisions After a short naval battle with North Korea in 2002, a summit was held in North Korea in 2004 in an attempt to improve relations between the two countries Although the summit did not result in any major changes, one third of the US troops stationed in South Korea were withdrawn As a result, both military leaders and other political parties in South Korea demanded that security issues be prioritized among national policies, which has perpetuated the military's strong influence in South Korean politics Page Political Violence violence in the country began due to different protests staged by the students to overthrow the presidents during 1960s and 1970s By the late 1980s, violence- prone student radicals, although a small minority, demonstrated increasing effectiveness in organizing temporary lock outs and arson against facilities In 1988, under the general guidance of the National Association of University Student Councils or the Seoul Area Federation of Student Councils, small groups of students staged more than two dozen raids on the US diplomatic and military facilities After the presidential elections, the political violence seems to have reduced but it could be still used as a means of resistance Future Prospects Confidence Building Measures with North Korea The two Koreas are still officially at war and the situation remains fraught In early October 2007, a historic Korean summit was held in Pyongyang, North Korea During this summit, both countries agreed that a solution to the historic rivalry over border issues needs to be found and as such both sides have signed a peace declaration aimed at replacing the armistice with a permanent peace treaty In addition, the summit also resulted in an agreement between North and South Korea to establish a joint economic area in the border port city of Haeju in 2008 The proposal included joint fishing areas along the sea border and a joint shipyard at Haeju This is seen as a necessary first step towards thawing relations between South and North Korea Page Strengthening Relations with the EU The EU and South Korea are major commercial partners, with mutual trade reaching $80 billion in 2006 The EU is South Korea's second biggest trading partner after China In May 2007, the first round of negotiations on a possible free trade agreement was held and negotiations have been ongoing since then, with the sixth round of negotiations completed at the end of January 2008 Among other things, negotiations have focused on creating a uniform auto standard for the automotive industry Both parties were also keen to solve tariff and quota issues If this agreement comes into force, it will provide South Korea with very lucrative future trade prospects, as the country strengthens its ties with other EU nations Incidentally, the EU is also one of the biggest investors in South Korea Future Risks Uneasy Relationship with North Korea South Korea has made consistent efforts towards reconciliation with North Korea However, provocative military actions and North Korea's efforts to build and acquire nuclear weapons are a cause for concern Moreover, the intrusions by the North-Korean ships in the South-Korean seas ended in a short naval battle in 2002 In late 2007, the summit resulted in boosting cooperation between the two countries especially in the area of transportation and logistics However, the intrusions by the North-Korean ships into South-Korean seas have continued even in 2008, which have increased the tension between the two countries Furthermore, North Korea warned South Korea over the Page alleged sending of the propaganda leaflets into its territory in May 2008 with the concomitant escalating of tensions between the two countries The relations between the two countries continue to remain tense and North Korea continues to remain a major military threat to South Korea • Economic Analysis The economic structure is well supported by government policies in South Korea Due to strong economic reforms, the country has continued to experience steady economic growth The powerful export sector is the main reason for economic growth in the country Although the country is developed in terms of all-round economic health, and provides a good investment climate, it still suffers from structural weaknesses due to very stringent rules on imports and FDI These restrictions are affecting the domestic market and make it internationally uncompetitive Even though the country is on a path of economic growth, it has been affected by declining FDIs Furthermore, the nuclear test conducted by North Korea has created uncertainty among investors in South Korea, which has led to instability in markets Current strengths ▪ Powerful export sector Current challenges ▪ Low level of imports Future prospects ▪ Competitive tax policy Future risks ▪ Nuclear crisis Page 10