Manning School of Business
Dr. Mark H. Mortensen
66.490.211 and 212
Tues &Thurs 2:00 to 3:15
3:30 to 4:45

Mortensen Consulting Group
Purchased text book & read Chapter 3
Purchased case studies
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Attendance
Group workshop on #2 – your company
Discussion on PEST(EL) analysis of external environment
Group work – do a PEST(EL) analysis of your company

Mortensen Consulting Group
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 Pull together your group information about the company that your group has been assigned to.
 Fill out the information on the profile sheet
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Mortensen Consulting Group
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Attendance
Group workshop on #2 – your company
Discussion on PEST(EL) analyses of the external environment
Group work – do a PEST(EL) analysis of your company

Mortensen Consulting Group
Assumptions
Truisms
Constraints
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TOOLS
PEST(EL) analysis
Porter 5-Forces model
Company positioning chart
Product positioning charts
BCG product matrix
GE product matrix
Core competency analysis
Value chain analysis
Bowman’s Strategy Clock

Mortensen Consulting Group
Assumptions
Constraints
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 Society
 Industry
 Internal company
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Truisms

Mortensen Consulting Group
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PEST Analysis is a simple but important and widely-used tool by business leaders worldwide to build their vision of the future.
Ensure that what you are doing is aligned positively with the forces of change that are affecting our world. By taking advantage of change, you are much more likely to be successful than if your activities oppose it.
Helps avoid taking action that is condemned to failure for reasons beyond your control.
Particularly useful when starting to operate in a new country or region.
Using it helps you break free of unconscious assumptions, and helps you quickly adapt to the realities of the new environment.

Mortensen Consulting Group
PEST(EL) Analysis
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Political
Form of government
Tax laws
Stability of government
Government attitude toward foreign companies
Strength of opposition groups
Trade regulations
Protectionist sentiment
Foreign policies
Terrorist activity
Legal System

Mortensen Consulting Group
PEST(EL) Analysis
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Economic
Economic development
Per capita income
Climate
GDP trends
Monetary and fiscal policies
Unemployment levels
Currency convertibility
Wage levels
Nature of competition
Membership in regional economic organizations, e.g. EU, NAFTA, ASEAN
Membership in World Trade
Organization
Outsourcing capability

Mortensen Consulting Group
PEST(EL) Analysis
Example: GDP Country Ranking

Mortensen Consulting Group
PEST(EL) Analysis
Example: Population and Growth
87 India 1.3%
125 US 0.9%
152 China 0.5%
199 Japan -0.1%

Mortensen Consulting Group
PEST(EL) Analysis
Example: Other Economic Indicators http://www.indexmundi.com/g/r.aspx?v=67

Mortensen Consulting Group
PEST(EL) Analysis
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Sociocultural
Customs, norms, values
Language
Demographics
Life expectancies
Social institutions
Status symbols
Lifestyle
Religious beliefs
Attitudes toward foreigners
Literacy level
Human rights
Environmentalism

Mortensen Consulting Group
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Baby boomers and retirees over 65 represent the fastest growing demographic segment of the population. We have talked about
10,000 Americans turning 50 every day for years and combined with a decline in the birth rate, 40% of the overall U.S. population is over 50.
In 1900, just 3.5 million Americans were 65 years of age. By 1998, that number grew to 35 million and projections are that by 2025 that number will be 70 million.
And it has been further projected that by the year 2030, there could be more Americans over 80 than there are under the age of eight!
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Mortensen Consulting Group
PEST(EL) Analysis
Sociocultural examples
8 Current Transformational Trends
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Expanding seniors market
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Impact of the Generation Y boomlet
Increasing environmental awareness
Growing health consciousness
Declining mass market
Changing pace and location of life
Changing household composition
Increasing diversity of workforce & market

Mortensen Consulting Group
PEST(EL) Analysis
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Technological
Regulations on technology transfer
Energy availability & cost
Natural resource availability
Transportation network
Skill level of workforce
Patent-trademark protection
Internet availability
Telecommunications infrastructure

Mortensen Consulting Group
PEST(EL) Analysis
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Environmental
Carbon emission regulations
Green movement
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Legal
Privacy regulations
Industry regulations

Mortensen Consulting Group
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Brainstorm the relevant factors that apply to the market, using the form.
Identify the information that applies to these factors.
Draw conclusions from this information.

Mortensen Consulting Group
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Attendance
Group workshop on #2 – your company
Discussion on PEST(EL) analysis of external environment
Group work – do a PEST(EL) analysis of your company

Mortensen Consulting Group
Due by: Thursday
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Each person visit both a Starbucks and a Dunkin’ Donuts retail store and write a report.
 Describe and contrast the atmospheres, types of menu items, service quality, and prices
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Describe and contrast the patrons and how they react to the above
Talk to at least one person in the store about why they come there and relate their opinions
 Describe your own experiences at each of them, from this and other visits.
Visit the Starbucks and Dunkin’ Donuts web sites:
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Try to determine their target markets, mission statements, and anything else you can glean about their strategies – write a paragraph or two on each
Contrast the two web sites
 Contrast the apparent strategies of the two
 Discuss how the information on the web sites does or does not match the reality in each case.
A few informal pages should suffice – if it wants to be longer, OK.

Mortensen Consulting Group