Wipro Limited PESTEL & Environment Analysis

Wipro Limited PESTEL analysis is a strategic tool to analyze the macro environment
of the organization. PESTEL stands for - Political, Economic, Social,
Technological, Environmental & Legal factors that impact the macro environment of
Wipro Limited.

Changes in the macro-environment factors can have a direct impact on not only the
Wipro Limited but also can impact other players in the Information Technology
Services. The macro-environment factors can impact the Porter Five Forces that
shape strategy and competitive landscape. They can impact individual firm�s
competitive advantage or overall profitability levels of the Technology industry.

PESTEL analysis provides great detail about operating challenges Wipro Limited will
face in prevalent macro environment other than competitive forces. For example an
Industry may be highly profitable with a strong growth trajectory but it won't be
any good for Wipro Limited if it is situated in unstable political environment.

Political Factors that Impact Wipro Limited

Political factors play a significant role in determining the factors that can
impact Wipro Limited's long term profitability in a certain country or market.
Wipro Limited is operating in Information Technology Services in more than dozen
countries and expose itself to different types of political environment and
political system risks. The achieve success in such a dynamic Information
Technology Services industry across various countries is to diversify the
systematic risks of political environment. Wipro Limited can closely analyze the
following factors before entering or investing in a certain market-

Political stability and importance of Information Technology Services sector in the

country's economy.
Risk of military invasion
Level of corruption - especially levels of regulation in Technology sector.
Bureaucracy and interference in Information Technology Services industry by
government.
Intellectual property protection
Trade regulations & tariffs related to Technology
Favored trading partners
Anti-trust laws related to Information Technology Services
Pricing regulations � Are there any pricing regulatory mechanism for Technology
Taxation - tax rates and incentives
Wage legislation - minimum wage and overtime
Work week regulations in Information Technology Services
Mandatory employee benefits
Industrial safety regulations in the Technology sector.
Product labeling and other requirements in Information Technology Services

Economic Factors that Impact Wipro Limited

The Macro environment factors such as � inflation rate, savings rate, interest
rate, foreign exchange rate and economic cycle determine the aggregate demand and
aggregate investment in an economy. While micro environment factors such as
competition norms impact the competitive advantage of the firm. Wipro Limited can
use country�s economic factor such as growth rate, inflation & industry�s economic
indicators such as Information Technology Services industry growth rate, consumer
spending etc to forecast the growth trajectory of not only --sectoryname-- sector
but also that of the organization. Economic factors that Wipro Limited should
consider while conducting PESTEL analysis are -

Type of economic system in countries of operation � what type of economic system

there is and how stable it is.
Government intervention in the free market and related Technology
Exchange rates & stability of host country currency.
Efficiency of financial markets � Does Wipro Limited needs to raise capital in
local market?
Infrastructure quality in Information Technology Services industry
Comparative advantages of host country and Technology sector in the particular
country.
Skill level of workforce in Information Technology Services industry.
Education level in the economy
Labor costs and productivity in the economy
Business cycle stage (e.g. prosperity, recession, recovery)
Economic growth rate
Discretionary income
Unemployment rate
Inflation rate
Interest rates

Social Factors that Impact Wipro Limited

Society�s culture and way of doing things impact the culture of an organization in
an environment. Shared beliefs and attitudes of the population play a great role in
how marketers at Wipro Limited will understand the customers of a given market and
how they design the marketing message for Information Technology Services industry
consumers. Social factors that leadership of Wipro Limited should analyze for
PESTEL analysis are -

Demographics and skill level of the population

Class structure, hierarchy and power structure in the society.
Education level as well as education standard in the Wipro Limited �s industry
Culture (gender roles, social conventions etc.)
Entrepreneurial spirit and broader nature of the society. Some societies encourage
entrepreneurship while some don�t.
Attitudes (health, environmental consciousness, etc.)
Leisure interests
Technological Factors that Impact Wipro Limited
Technology is fast disrupting various industries across the board. Transportation
industry is a good case to illustrate this point. Over the last 5 years the
industry has been transforming really fast, not even giving chance to the
established players to cope with the changes. Taxi industry is now dominated by
players like Uber and Lyft. Car industry is fast moving toward automation led by
technology firm such as Google & manufacturing is disrupted by Tesla, which has
stated an electronic car revolution.

A firm should not only do technological analysis of the industry but also the speed
at which technology disrupts that industry. Slow speed will give more time while
fast speed of technological disruption may give a firm little time to cope and be
profitable. Technology analysis involves understanding the following impacts -

Recent technological developments by Wipro Limited competitors

Technology's impact on product offering
Impact on cost structure in Information Technology Services industry
Impact on value chain structure in Technology sector
Rate of technological diffusion
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Environmental Factors that Impact Wipro Limited
Different markets have different norms or environmental standards which can impact
the profitability of an organization in those markets. Even within a country often
states can have different environmental laws and liability laws. For example in
United States � Texas and Florida have different liability clauses in case of
mishaps or environmental disaster. Similarly a lot of European countries give
healthy tax breaks to companies that operate in the renewable sector.

Before entering new markets or starting a new business in existing market the firm
should carefully evaluate the environmental standards that are required to operate
in those markets. Some of the environmental factors that a firm should consider
beforehand are -

Weather
Climate change
Laws regulating environment pollution
Air and water pollution regulations in Information Technology Services industry
Recycling
Waste management in Technology sector
Attitudes toward �green� or ecological products
Endangered species
Attitudes toward and support for renewable energy
Legal Factors that Impact Wipro Limited
In number of countries, the legal framework and institutions are not robust enough
to protect the intellectual property rights of an organization. A firm should
carefully evaluate before entering such markets as it can lead to theft of
organization�s secret sauce thus the overall competitive edge. Some of the legal
factors that Wipro Limited leadership should consider while entering a new market
are -

Pestel Infosys

The PESTEL analysis is a tool devised by Harvard professor Francis Aguilar to

conduct a thorough external analysis of the business environment of any industry
for which data is available. This is an important step for eventually devising a
strategy that can effectively manoeuvre the competition to maximize a firm's
chances of sustainability and profitability. PESTEL is an amalgam of initials of
various factors that not only affect Infosys but the entire industry as a whole-
these factors are namely Political, Economic, Social, Technological, Environmental
and Legal.

PESTEL analysis provides valuable insight into the operating challenges that any
company in the industry appears to face, and so the company in question may face as
well. An understanding of the overall competitive landscape will prevent investors
and entrepreneurs from partaking in any risky ventures if the risk arises out of,
say, an unstable political regime or a sudden economic recession. This may be best
exemplified by the recent exit of the United Kingdom from the European Union. The
sudden fallout was political and caused many investors to pull out of new ventures
and halt their expansions, as the future became uncertain in the wake of this
decision.
Political Factors that Impact Infosys
The political factors that may impact the profitability or chances of survival of
the company are quite diverse. The political risks vary from sudden changes in
existing political regimes to civil unrest to major decisions taken by the
government. In cases of possible multinationals, one may also include political
factors that take place/ affect not only the host country but also all countries
that contain business operations, or that may engage in trade with Infosys

To properly appraise the extent of the overall systematic political risk that
Infosys may be exposed to, the following factors should be considered before taking
part in any investments:

The level of political stability that the country has in recent years.
The integrity of the politicians and their likelihood to take part in acts of
corruption, as the resulting repercussions may lead to possible impeachments or
resignations of high level government employees.
The laws that the country enforces, especially with regards to business, such as
contract law, as they dictate what Infosys is and is not allowed to do. Some
countries, for example, prohibit alcohol or have certain conditions that must be
fulfilled, while some government systems have inefficient amounts of red tape that
discourage business.
Whether or not a company�s intellectual property (IP) is protected. For example, a
country that has no policies for IP protection would mean that entrepreneurs may
find it too risky to invest in Infosys
The trade barriers that the host country has would protect Infosys; however, trade
barriers that countries with potential trade partners would harm companies by
preventing potential exports.
A high level of taxation would demotivate companies like Infosys from maximizing
their profits.
The risk of military invasion by hostile countries may cause divestment from
ventures.
A low minimum wage would mean higher profits and, thus, higher chances of survival
for Infosys

Economic Factors that Impact Infosys

Economic factors are all those that pertain to the economy of the country that
Infosys, such as changes in the inflation rate, the foreign exchange rate, the
interest rate, the gross domestic product, and the current stage of the economic
cycle. These factors, and their resulting impact on aggregate demand, aggregate
investment and the business climate, in general, have the potential to make a
company highly profitable, or extremely likely to incur a loss. The economic
factors in the PESTEL analysis are macroeconomic.

The economic factors that Infosys may be sensitive to, and in turn should consider
before investing may include the following:

The economic system that is currently operational in the sector in question-

whether it is a monopoly, an oligopoly, or something similar to a perfect
competition economic system.
The rate of GDP growth in the country will affect how fast Infosys is expected to
grow in the near future.
The interest rates in the country would affect how much individuals are willing to
borrow and invest. Higher rates would result in greater investments that would mean
more growth for Infosys
However efficiently the financial markets operate also impact how well Infosys can
raise capital at a fair price, keeping in mind the demand and supply.
The exchange rate of the country Infosys operates in would impact the profitability
of Infosys, particularly if Infosys engages in international trade. The stability
of the currency is also important- an unstable currency discourages international
investors.
A high level of unemployment in the country would mean there is a greater supply of
jobs than demand, meaning people would be willing to work for a lower wage, which
would lower the costs of Infosys

Social Factors that Impact Infosys

The social factors that impact Infosys are a direct reflection of the society that
Infosys operates in, and encompasses culture, belief, attitudes and values that the
majority of the population may hold as a community. The impact of social factors is
not only important for the operational aspect of Infosys, but also on the marketing
aspect of the organization. A thorough understanding of the customers, their
lifestyle, level of education and beliefs in a society, or segment of society,
would help design both the products and marketing messages that would lead to a
venture becoming a success.

The social factors that affect Infosys and should be included in the social aspect
of the PESTEL analysis include the following:

The demographics of the population, meaning their respective ages and genders,
vastly impact whether or not a certain product may be marketed to them. Makeup is
mostly catered to women, so targeting a majority male population would be less
population than targeting a population that is mostly female.
The class distribution among the population is of paramount importance: Infosys
would be unable to promote a premium product to the general public if the majority
of the population was a lower class; rather, they would have to rely on very niche
marketing.
To some extent, the differences in educational background between the marketers and
the target market may make it difficult to relate to and draw in the target market
effectively. Infosys should be very careful not to lose the connection to the
target market's interests and priorities.
Infosys needs to be fully aware of what level of health standards, reactions to
harassment claims and importance of environmental protection prevail in the
industry as a whole, and thus are expected from any company as they are seen as the
norm.
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Technological Factors that Impact Infosys
Technology can rapidly dismantle the price structure and competitive landscape of
an industry in a very short amount of time. It thus becomes extremely important to
constantly and consistently innovate, not only for the sake of maximizing possible
profits and becoming a market leader, but also to prevent obsolescence in the near
future. There are multiple instances of innovative products completely redesigning
the norm for an entire industry: Uber and Lyft dominate the taxi cab industry;
smartphones have left other phones an unviable option for most et cetera.

The technological factors that may influence Infosys may include the following:

The recent technological developments and breakthroughs made by competitors, as

mentioned above. If Infosys encounters a new technology that is gaining popularity
in the industry in question, it is important to monitor the level of popularity and
how quickly it is growing and disrupting its competitors� revenues. This would
translate to the level of urgency required to adequately respond to the innovation,
either by matching the technology or finding an innovative alternative.
How easy, and thus quickly, will the technology be diffused to other firms in the
industry, leading to other firms copying the technological processes/ features of
Infosys
How much an improvement of technology would improve/ transform what the product
initially offers. If this improvement is drastic, then other firms in the industry
suffer more heavily.
The impact of the technology on the costs that most companies in the industry are
subject to have the potential to increase or reduce the resulting profits greatly.
If these profits are great in number, they may be reinvested into the research and
development department, where future technological innovations would further raise
the level of profits, and so on, ensuring sustainable profits over a long period of
time.

Environmental Factors that Impact Infosys

Different industries hold different standards of environmental protection in their
head as the norm. This norm then dictates what every company should aim for, in the
least, to prevent becoming the target of pressure groups and boycotts due to a lack
of environmental conscientiousness. A company in the textile industry, for example,
is not expected to incur the same level of pollution and environmental degradation
as an oil company. The new consumer, armed with the interest and the knowledge it
carries, prefers to give its business to companies it views as more ethical,
particularly about the environment in the wake of global warming.

The environmental factors that may significantly impact Infosys include:

The current weather conditions may significantly impact the ability of Infosys to
manage the transportation of both the resources and the finished product. This, in
turn, would affect the delivery dates of the final product in the case of, say, an
unexpected monsoon.
Climate change would also render some products useless. For example, in the case of
textiles, in countries where the winter has become very mild due to Global Warming,
warm winter clothes have much less of a market.
Those companies that produce extremely large amounts of waste may be required by
law to manage their environmental habits. This may include pollution fines and
quotas, which may place a financial strain on Infosys
If Infosys should (knowingly or unknowingly) contribute to the further endangerment
of an already endangered species may face not only the consequences from the law
but also face a backlash from the general public who may then boycott Infosys in
retaliation.
While relying, in any percentage, on renewable energy may be expensive, it often
receives support not only from the government but also from its customer base, who
may be willing to pay a premium price for the products that Infosys may produce.

Legal Factors that Impact Infosys

The government institutions and frameworks in a country, while technically also
political and thus subject to whichever political party holds the majority in a
government body, are also legal and thus should be considered in a PESTEL analysis.
Often Infosys policies on their own are not enough to efficiently protect Infosys
and its workers, making Infosys appear an undesirable place of employment that may
repel skilled, talented workers.

INFORMATION TECHNOLOGY
We are using the term information technology or IT to refer to an entire industry.
In actuality, information technology is the use of computers and software to manage
information. In some companies, this is referred to as Management Information
Services (MIS) or simply as Information Services (IS). The information technology
department of a large company would be responsible for storing information,
protecting information, processing the information, transmitting the information as
necessary, and later retrieving information as necessary.

History of Information Technology:

In relative terms, it wasn�t long ago that the Information Technology department
might have consisted of a single Computer Operator, who might be storing data on
magnetic tape, and then putting it in a box down in the basement somewhere. The
history of information technology is fascinating! These Information Technology
resources for information on everything from the history of IT to electronics
inventions and even the top 10 IT bugs.

Modern Information Technology Departments:

In order to perform the complex functions required of information technology
departments today, the modern Information Technology Department would use
computers, servers, database management systems, and cryptography. The department
would be made up of several System Administrators, Database Administrators and at
least one Information Technology Manager.

In India, the software boom started somewhere in the late 1990s. Most of the Indian
software companies at that moment offered only limited software services such as
the banking and the engineering software. The business software boom started with
the emergence of year2000 problem, when a large number of skilled personnel were
required to fulfill the mammoth database-correction demand in order to cope up with
the advent of the new millennium.

The profile of the Indian IT Services has been undergoing a change in the last few
years, partly as it moves up the value chain and partly as a response to the market
dynamics. Ten years ago, most US companies would not even consider outsourcing some
of their IT projects to outside vendors. Now, ten years later, a vast majority of
US companies use the professional services of Indian Software engineers in some
manner, through large, medium or small companies or through individuals recruited
directly.

The market competition is forcing organizations to cut down on costs of products.

The professional IT services on the other hand are becoming increasingly expensive.
The offshore software development model is today where onsite professional services
were ten years ago. There is a high chance (almost a mathematical certainty), that
in less than ten years, the vast majority of IT services (software development
being just one of them) from developed countries, will be, one, outsourced and two,
outsourced to an offshore vendor.

Despite the global economic slowdown, the Indian IT software and services industry
is maintaining a steady pace of growth. Software development activity is not
confined to a few cities in India. Software development centers, such as Bangalore,
Hyderabad, Mumbai, Pune, Chennai, Calcutta, Delhi, Noida, Gurgaon, Vadodara,
Bhubaneswar, Ahmadabad, Goa, Chandigarh, and Trivandrum are all developing quickly.
All of these places have state of the art software facilities and the presence of a
large number of overseas vendors. India�s most prized resource is its readily
available technical work force. India has the second largest English-speaking
scientific professionals in the world, second only to the U.S. It is estimated that
India has over 4 million technical workers, over 1,832 educational institutions and
polytechnics, which train more than 67,785 computer software professionals every
year. The enormous base of skilled manpower is a major draw for global customers.
India provides IT services at one-tenth the price. No wonder more and more
companies are basing their operations in India.

The industry is in an expansion mode right now, with dozens of new offshore IT
services vendors emerging every day, the industry has a high probability of being
subjected to the 80:20 rule in not too distant a future. In perhaps another ten
years, 80 percent of all outsourced offshore development work will be done by 20
percent of all vendors, a small number of high qualities, trusted vendors. Only a
few select countries and only the most professional companies in those countries
will emerge as winners. India will definitely be the country of choice for offshore
software development. It has the potential to become and remain the country of
choice for all software developments and IT enabled services, second only to the
USA. The third choice could be far distant.

India is among the three countries that have built supercomputers on their own. The
other two are USA and Japan. India is among six countries that launch satellites
and do so even for Germany and Belgium. India�s INSAT is among the world�s largest
domestic satellite communication systems. India has the third largest
telecommunications network among the emerging economies and it is among the top ten
networks of the world.

To become a global leader in the IT industry and retain that position, India needs
to constantly keep moving up the value chain, focusing on finished products and
solutions, rather than purely on skill sets and resumes. It also needs to be able
to package its services as products, rather than offering them as raw material. It
needs to be able to recognize and build up on its strengths and work on weaknesses.

Another extension of the IT industry is the ITES (Information Technology Enabled

Services) which is a sector dependent on IT sector.

Information technology consulting (IT consulting or business and technology

services) is a field that focuses on advising businesses on how best to use
information technology to meet their business objectives. In addition to providing
advice, IT consultancies often implement, deploy, and administer IT systems on
businesses� behalf.

The PC industry is one of the strangest in the world. There is probably no other
type of product that is so technologically sophisticated, sells for so much money,
and yet is sold by so many companies for so little profit. The severe competition
in the industry is the one reason why so many problems are encountered by those who
deal with PC vendors. While I consider there to be absolutely no excuse for a
company not treating its customers fairly, at the same time I think customers
should have some idea of what vendors are up against in this demanding marketplace.

PESTLE ANALYSIS
There are many factors in the macro-environment that will effect the decisions of
the managers of any organization. Tax changes, new laws, trade barriers,
demographic change and government policy changes are all examples of macro change.
To help analyze these factors, managers can categorize them using the PESTLE model.

PESTLE stands for Political, Economical, Social, Technical, Legislative and

Environmental. It is a strategic planning technique that provides a useful
framework for analyzing the environmental pressures on a team or an organization.
It describes a framework of macro environmental factors used in the environmental
scanning component of strategic management. It is a part of the external analysis
when conducting a strategic analysis or doing market research and gives a certain
overview of the different macro environmental factors that the company has to take
into consideration. It is a useful strategic tool for understanding market growth
or decline, business position, potential and direction for operations. PESTLE
factors play an important role in the value creation opportunities of a strategy.
However they are usually outside the control of the corporation and must normally
be considered as either threats or opportunities.

Kotler (1998) claimed that PESTLE analysis is a useful strategic tool for
understanding market growth or decline, business position, potential and direction
for operations. The headings of PESTLE are a framework for reviewing a situation,
and can in addition to SWOT and Porter�s Five Forces models, be applied by
companies to review strategic directions, including marketing proposition.

(P)olitical factors
These refer to government policies such as the degree of intervention in the
economy. What goods and services does a government want to provide? To what extent
does it believe in subsidizing firms? What are its priorities in terms of business
support? Political decisions can impact on many vital areas for business such as
the education of the workforce, the health of the nation and the quality of the
infrastructure of the economy such as the road and rail system, Government rules
and regulations can also affect a business heavily. Rules and regulations such as
environmental regulations, industry specific regulations, competitive regulations,
consumer protection and various kinds of employment laws.

(E)conomical factors
These include interest rates, taxation changes, economic growth, inflation and
exchange rates, governments spending levels, unemployment, job growth, tariffs,
consumer confidence index and import or export rations. Economic changes can have a
major impact on a firm�s behavior.

Higher interest rates may deter investment because it costs more to borrow.
A strong currency may make exporting more difficult because it may raise the price
in terms of foreign currency
Inflation may provoke higher wage demands from employees and raise costs
Higher national income growth may boost demand for a firm�s products
(S)ocial factors
These often look at the cultural aspects and include health consciousness,
population growth rate, demographics (age, gender ,race, distribution), career
attitudes and emphasis on safety , lifestyle changes, population shifts, education
trends, fads, diversity, immigration/emigration, housing trends, fashion, attitudes
to work, leisure activities, occupations and earning capacity.

Changes in social trends can impact on the demand for a firm�s products and the
availability and willingness of individuals to work. Today the aging of population
has become a huge problem. This has increased the costs for firms who are committed
to pension payments for their employees because their staff is living longer. It
also means some firms have started to recruit older employees to tap into this
growing labour pool. The ageing population also has impact on demand: for example,
demand for sheltered accommodation and medicines have increased whereas demand for
toys is falling.

(T)echnological factors
Technological factors include ecological and environmental aspects and can
determine barriers to entry, minimum efficient production level and influence
outsourcing decisions. Technological factors look at elements such as R&D activity,
automation, technology incentives and the rate of technological change. New
technologies create new products and new processes. MP3 players, computer games,
online gambling and high definition TVs are all new markets created by
technological advances. Online shopping, bar coding and computer aided designing
are all improvements to the way we do business as a result of better technology.
Technology can reduce costs, improve quality and lead to innovation. These
developments can benefit consumers as well as the organizations providing the
products.

(L)egal factors
These are related to the legal environment in which firms operate. In recent years
in UK there have been many significant legal changes that have affected
organizations behavior. The introduction of age discrimination and disability
discrimination legislation, an increase in the minimum wage and greater
requirements for firms to recycle are examples of relatively recent laws that
affect an organization�s actions. Legal changes can affect a firm�s costs (e.g. if
new systems and procedures have to be developed) and demand (e.g. if the law
affects the likelihood of customers buying the good or using the service).

(E)nvironmental factors
Environmental factors include the weather and climate change. Changes in
temperature can impact on many industries including farming, tourism and insurance.
With major climate changes occurring due to global warming and with greater
environmental awareness this external factor is becoming a significant issue for
firms to consider. The growing desire to protect the environment is having an
impact on many industries such as the travel and transportation industries (for
example, more taxes being placed on air travel and the success of hybrid cars) and
the general move towards more environmentally friendly products and processes is
affecting demand patterns and creating business opportunities.

Introduction:
Infosys Technologies Ltd. (NASDAQ: INFY) was started in 1981 by seven people with
US$ 250. Today, we are a global leader in the �next generation� of IT and
consulting with revenues of over US$ 4 billion. Infosys defines designs and
delivers technology-enabled business solutions that help Global 2000 companies win
in a Flat World. Infosys also provides a complete range of services by leveraging
our domain and business expertise and strategic alliances with leading technology
providers.

Infosys� offerings span business and technology consulting, application services,

systems integration, product engineering, custom software development, maintenance,
re-engineering, independent testing and validation services, IT infrastructure
services and business process outsourcing Infosys pioneered the Global Delivery
Model (GDM), which emerged as a disruptive force in the industry leading to the
rise of offshore outsourcing. The GDM is based on the principle of taking work to
the location where the best talent is available, where it makes the best economic
sense, with the least amount of acceptable risk. Infosys has a global footprint
with over 50 offices and development centers in India, China, Australia, the Czech
Republic, Poland, the UK, Canada and Japan.

Infosys has over 103,000 employees. Infosys takes pride in building strategic long-
term client relationships. Over 97% of our revenues come from existing customers.

In an increasingly globalised world, significant complexity and uncertainty is

getting attached to the unprecedented economic crisis. The Indian economy has also
been impacted by the recessionary trends, with a slowdown in GDP growth to seven
per cent. The focus and exponential growth in the domestic market has partially
offset this fall and insulated the country, resulting in net overall momentum. The
IT-BPO industry in India has today become a growth engine for the economy,
contributing substantially to increases in the GDP, urban employment and exports,
to achieve the vision of a �young and resilient� India. During the year, the sector
maintained its double digit growth rate and was a net hirer. This growth has been
fueled by increasing diversification in the geographic base and industry verticals,
and adaptation in the service offerings portfolio. While the effects of the
economic crisis are expected to linger in the near term future, the Indian IT-BPO
industry has displayed resilience and tenacity in countering the unpredictable
conditions and reiterating the viability of India�s fundamental value proposition.
Consequently, India has retained its leadership position in the global sourcing
market. The Indian IT-BPO industry is estimated to achieve revenues of USD 71.7
billion in FY2009, with the IT software and services industry accounting for USD 60
billion of revenues. During this period, direct employment is expected to reach
nearly 2.23 million, an addition of 226,000 employees, while indirect job creation
is estimated to touch 8 million. As a proportion of national GDP, the sector
revenues have grown from 1.2 per cent in FY1998 to an estimated 5.8 per cent in
FY2009. Software and services exports (including BPO) are expected to account for
over 99 per cent of total exports, employing over 1.76 million employees. While the
current mood is that of �cautious optimism,� the industry is expected to witness
sustainable growth over a two-year horizon, going past its USD 60 billion export
target in FY2011. While the industry has significant headroom for growth,
competition is increasing, with a number of countries creating enabling business
environments aimed at replicating India�s success in the IT-BPO industry. Hence,
concentrated efforts are required by all stakeholders to address the current
challenges, to ensure that India realizes its potential, and maintains its
leadership position.

Vision
�To be a globally respected corporation that provides best-of-breed business
solutions, leveraging technology, delivered by best in class people.�

Mission
�To achieve our objectives in an environment of fairness, honesty, and courtesy
towards our clients, employees, vendors and society at large.�

STP Analysis Segmentation

Geographical regions: US, India, Australia, China, UK

Psychographics: MNC, BFSI, Hospitality Sector

Demographic: Population or Employee strength of consumer company: +5000

Strategy:
Infosys has adopted a client-focused strategy to achieve growth. Rather than
focusing on numerous small organizations, it focuses on limited number of large
organizations throughout world. In order to cater its clients, the company
emphasizes on custom-built software�s. Another differentiating factor for Infosys
is that it commands premium margins. Company does not negotiate over margins beyond
a certain limit and some time prefers to walk-out rather than compromise on quality
for low-cost contracts. This has helped in building an image for quality driven
model rather than cost-differentiating model. Increase business from existing and
new clients: Infosys has focused on expanding the nature and scope of engagements
for the existing clients by increasing the size and number of projects and
extending the breadth of its service offerings. For new clients, it provides value
added solutions by leveraging its in-depth industry expertise. It increases its
recurring business with clients by providing software re-engineering, maintenance,
infrastructure management and business process management services which are long-
term in nature and require frequent client contact. Expand geographically: Infosys
plans to establish new sales and marketing offices, representative offices and
global development centers to expand its geographical reach.

Enhance solution set: Infosys focuses on emerging trends, new technologies,

specific industries and pervasive business issues that confront our clients

Pestle of Infosys:
(P)olitical:
Political stability: Indian political structure is considered stable enough expect
the fact that there is a fear of �hung parliament� (no clear majority).
U.S. government has declared that U.S companies that outsource IT work to other
locations other than U.S. will not get tax benefit.
Government owned companies and PSUs have decided to give more IT projects to Indian
IT companies.
Terrorist attack or war.

(E)conomic:
Global IT spending (demand)
Domestic IT Spending (Demand): Domestic market to grow by 20% and reach approx USD
20 billion in 2008-09 � NASSCOM
Currency Fluctuation
Real Estate Prices: Decline in real estate prices has resulted reducing the rental
expenditures.
Attrition: Due to recession, the layoffs and job-cuts have resulted in low
attrition rate.
Economic Attractiveness:
Due to cost advantage and other factors

(So)cial:
Language spoken: English is widely spoken language in India, English medium being
the most accepted medium of education. Thus, India boasts of large English speaking
population.
Education: A number of technical institutes and universities over the country offer
IT education.
Working age population

(T)echnological:
Telephony:
India has the world�s lowest call rates (1-2 US cents).
Expected to have total subscriber base of about 500 million by 2010.
ARPU for GSM is USD 6.6 per month.
India has the second largest telephone network after china.
Teledensity � 19.86 %
Enterprise telephone services, 3G, Wi-max and VPN are poised to grow.
Internet Backbone:

Due to IT revolution in 90�s India is well connected with undersea optical cables.

New IT Technologies:

Technologies like SOA, web 2.0, High definition content, grid computing, and
innovation in low cost technologies is presenting new challenges & opportunities
for Indian IT industry.

Internet Backbone:
Due to IT revolution of �90s, Indian cities and India is well connected with
undersea optical cables.

New IT technologies:
Technologies like SOA, Web 2.0, High-definition content, grid computing, etc and
innovation in low cost technologies is presenting new challenges and opportunities
for Indian IT industry.

============================================================
Pestel Lenovo
Lenovo is a renowned player in the global PC industry. The brand has created a
differentiated brand image on the basis of its excellent resources and capabilities
and a differentiated business model that serves the customers directly. It has
introduced a wide product line consisting of products that cater to various
customer groups including professionals and businesses. Dell has generally remained
highly competitive in terms of pricing.

However, it has also released a few premium range products for its premium
customers. It has released laptops for hardcore gamers and several other products
that fulfill the IT needs of its consumers. In the last few years, its market has
seen a decline globally. Particularly, in the Asian markets, it could not generate
as good sales as Lenovo or HP. The reason is both increased competition and the
proliferation of mobile technology. There are several forces in the external
environment that affect the business and profitability of Dell. Here is a PESTLE
analysis that explains these factors and their effect on Dell�s business.

Political factors:
Political factors have a major impact on businesses operating in the international
environment. Global players have to deal with significant political pressures.
Policies related to foreign businesses, tax regulations and varying political
environment all have a direct impact on these businesses and their revenue. The
strain in foreign relationships between China and US can also trouble the American
businesses operating there to some extent. Apart from it, political stability is a
sign of economic stability and a flourishing market. If the political environment
grows unstable it affects the supply chain and distribution networks too.

Political instability is always bad for business. In the recent years, EU has been
targeting US businesses in several areas. Political instability in Europe also
affects Dell because it is a significant part of its market. If the political
environment of a nation is friendly and peaceful, it is easier to do business and
grow your brand there. In China, the situation has generally remained peaceful,
still diplomatic relationships between US and China are not taking a satisfactory
turn. It could affect the US brands like Dell operating in China. Political
stability is also essential for continued supply of raw materials and labor
especially for brands having an international supply chain.

Economic :
Economic factors are most important in case of business because they impact both
sellers and the customers directly. The world has recently been through a cycle of
recession and its effect was felt by most international brands. If the economic
conditions are bad, the market is affected and the consumers� purchasing power is
reduced. In such conditions, the sales of the international brands can fall. In the
past few years, the global economy has been doing well but the economies of the
individual nations may not be in as good shape and in several nations the economic
situation is still affected. The Asian economy is growing fast but Dell�s
performance there is poor. However, the reasons can be different than economical.

Economic conditions affect several things including operational costs which can
grow high in such conditions. A large number of companies were forced globally to
reduce their number of employees because of the global recession. Economic slowdown
does not just reduce sales and profits but can also create other pressures that
will lead to poor performance and higher losses. The problem is that the economic
situation is never under the control of brands and economic volatility can always
have a bad effect on business. The dollar has grown stronger since the recession
and due to that the problem has been aggravated for the US brands. Their profits
from international sales have dropped. Dell has also not remained unaffected.

Social:

The social factors too can have a deep impact on businesses. Their effect can be
both direct and indirect. These factors are an important reason that the brands
have to focus upon brand localization. Social trends can impact the sales of
particular products. Dell is a manufacturer of laptops and IT solutions. The
growing trend of smartphones and tablets has impacted the sales of PCs and laptops
in most markets globally. Dell has also seen a drop in its sales of PCs and
laptops. Society and culture are not the same globally and unless brands are able
to formulate different strategies for different markets, they cannot be
successful in the global environment.

In terms of marketing and advertising these factors are a very important

consideration. Changing trends and preferences all have a deep impact on the sales
of specific products and brands and they have to adjust their strategy accordingly.
Now, detachables and tablets are being preferred against the common laptops. Brands
have to accordingly respond with latest products. Consumer preferences need to be
considered before trying to venture into new markets and they can change from
culture to culture.

Technological:
Dell is a technological company and therefore will be influenced by technological
changes undoubtedly. During the recent years the demand for mobile gadgets has gone
up. The proliferation of mobile technology has hurt PC sales globally. More and
more customers are looking for smartphones and tablets with larger screen sizes.
Technological changes can swiftly alter the market dynamics and affect the sales
and revenue of businesses. This decade has also seen the rise of cloud business.

Dell has entered the cloud business and offers a large range of cloud solutions.
Technological companies have to be quick to measure the changes happening in the
technological environment and respond to them quick to remain competitive. Dell has
also released several new versions of laptops and other IT related products that
can cater to the customers of the new era whether individuals or businesses.
However, competition has also grown heavier with several big brands having entered
into cloud business.

Environmental:
Environmental issues have become increasingly important for businesses in the 21st
century. It is because while governments have framed laws that are more friendly to
the environmentally responsible businesses, customers too love to buy from the
environment friendly businesses. Being environment friendly has several benefits.
While on the one hand businesses have been able to reduce their carbon footprint
and operational costs, they also have a lot to benefit from their improved brand
image. Societies and governments world over are concerned for the environment and
therefore the brands that are more environment friendly are doing better business.
Dell has also invested in recycling, energy efficiency and other areas to reduce
its impact on the environment.

Legal:
Legal compliance is another major issue before the international brands. The laws
can be different from nation to nation and brands are required to adhere to them
whichever region they are operating in. There are several laws that the businesses
are required to adhere to including labor laws and quality and environment laws.
Unless these brands comply with the local laws, they would lose significant sums as
fines. Dell has also faced several legal issues in the past in China and other
nations.

POLITICAL FACTORS: STRATEGIC INTERNATIONAL RELATIONSHIPS

Dell Technologies must be strategic about who and where they conduct their
business. They�re at the mercy of many political legislations including political
instability, tax laws, trade measures, and foreign currency rates. We�ve also seen
simmering temperatures between the United States and China which can negatively
affect distribution networks not just in China, but in the countries associated
with the Chinese government.

Despite the turbulence in the White House, the United States is still friendly with
several countries who import and trade Dell Technologies products. These countries
favor open trade regulations and agreements.

The problem is, they may not have the same agreements in place with neighbouring
countries. Take India and Pakistan, for example. They�re not on great terms for
business because of difficulties involving imports and exports. Countries with poor
relationships can directly influence Dell Technologies� sales in both locations.

Not only does Dell Technologies have to abide by regulations indoctrinated within
the United States, but also in every country they trade in. How a country is run
directly influences Dell Technologies� distribution channels. If a country runs as
a dictatorship, it�s likely to have flexible and changing business laws. Dell
Technologies will need to bend, change, and abide every time a new law is passed.
The instability can also worsen their sales, causing unnecessary and unpredictable
changes in their company�s profits.

ECONOMIC FACTORS: CUSTOMERS CAN�T KEEP UP WITH THE INCREASED PRODUCTS

Dell Technologies is affected by three primary economic factors: the fluctuation of
foreign currency rates, the cost of raw materials for their products, and
macroeconomic stability in each country they conduct business. Increased taxation
or currency can radically spike the cost of products for consumers in different
countries.

Importing the products becomes a financial nightmare. Sometimes the cost of

shipping is dramatically increased, adding additional hundreds of dollars just for
a customer to get the product to their home. This transforms their products into a
luxury many can�t afford, affecting Dell Technologies� profits. If they don�t
handle these fluctuating costs, they�ll lose customers all over the world to
similar products that are much more cost-effective. We lived in a time where
competition can appear at any given moment, especially when it comes to technology.

Dell Technologies has also made several acquisitions of companies including

Alienware, AppAssure Software, and StatSoft. It�s not just a computer company
anymore; it�s a massive technology giant breaking off into the Big Data, gaming,
and recovery software industries. Each acquisition leads to more revenue, but, on
the other hand, requires more resources to abide by the regulations for safe and
legal business practices.

SOCIAL FACTORS: A NAME EVERYONE KNEW

Once upon a time, only business employees and owners were on the lookout for
computers. It was a necessity. For others, it was a luxury. But that was so long
ago and now children as young as 5 years old are using laptops daily.

Dell Technologies has created a host of products to engage customers including

savvy business owners and school-age children. But they face numerous competition
from similar brands like HP, Lenovo, and Asus. And we can�t forget about Apple, who
creates sleek, easy-to-use technology built for businesses and the education crowd.

They�ve been jumping on the gaming laptop bandwagon. Online gaming, known as e-
sports, has developed into a worldwide phenomenon. Professional e-sports teams can
compete to win millions of dollars in yearly or quarterly competitions. Many kids,
teenagers, and adults spend their time playing online games, and now Dell
Technologies is catering to this crowd. But they�re competing against brands, like
MSI, who are well-known in this industry from average and professional gamers
alike.

Dell computers was a household name in North America, favored for their
dependability as the internet became more mainstream and accessible. But even as
one of the largest technological companies in the world, many of the younger crowd
don�t go crazy when they hear the brand name.

TECHNOLOGICAL FACTORS: CONSTANT UPGRADES EVERYWHERE

Dell Technologies is a technology corporation, so unlike other companies, they can
face many issues involving technological laws. But they also face competition as
technology continuously develops.

For example, I mentioned Dell Technologies� involvement with online gaming by

providing gaming-performance laptops. To keep up with the competition, they
acquired Alienware, a nationally recognized gaming computer. But these type of
laptops rely heavily on maintaining the latest graphics cards. Without it,
customers won�t be able to run high-intensity games. Can Dell Technologies really
keep up with the demand?

Technology easily becomes obsolete when a new upgrade hits the scene and computers
are rarely ever the exception. In a year�s time, the latest model can become
subpar. People are constantly on the lookout for the fastest and highest performing
computers. And since they�re comprised of so many working parts, once an upgrade
comes out, customers line up to have it.

Because the competition is always growing. They�re either upgrading parts or

branching into other markets. Samsung is all over the technological world. They
provide laptops, phones, televisions, and tablets. They build brand loyalty in all
markets. If people can depend on their Samsung phone, they�re likely to say yes to
other products they create, even if they�re from an entirely different industry.
Dell Technologies has done the same thing, supplying many products including
computers, software, and cameras. They�re currently the number one shipper of
monitors in the entire world.

organization. PESTEL stands for - Political, Economic, Social, Technological,

Environmental & Legal factors that impact the macro environment of Dell
Technologies Inc..

Changes in the macro-environment factors can have a direct impact on not only the
Dell Technologies Inc. but also can impact other players in the Diversified
Computer Systems. The macro-environment factors can impact the Porter Five Forces
that shape strategy and competitive landscape. They can impact individual firm�s
competitive advantage or overall profitability levels of the Technology industry.
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PESTEL analysis provides great detail about operating challenges Dell Technologies
Inc. will face in prevalent macro environment other than competitive forces. For
example an Industry may be highly profitable with a strong growth trajectory but it
won't be any good for Dell Technologies Inc. if it is situated in unstable
political environment.

Spanish oil giant Repsol had to face a similar instance. It started an above
average profitability operations in Argentina and made strong returns in 5-7 years.
But the business was later expropriated by the Left Wing government. So the decade
long profits didn�t materialize in the end.

Order Now - Dell Technologies Inc. PESTEL / PEST Analysis

Order Now - Dell Technologies Inc. Porter 5 Forces Analysis & Industry Analysis

Political Factors that Impact Dell Technologies Inc.

Political factors play a significant role in determining the factors that can
impact Dell Technologies Inc.'s long term profitability in a certain country or
market. Dell Technologies Inc. is operating in Diversified Computer Systems in more
than dozen countries and expose itself to different types of political environment
and political system risks. The achieve success in such a dynamic Diversified
Computer Systems industry across various countries is to diversify the systematic
risks of political environment. Dell Technologies Inc. can closely analyze the
following factors before entering or investing in a certain market-

Political stability and importance of Diversified Computer Systems sector in the

country's economy.
Risk of military invasion
Level of corruption - especially levels of regulation in Technology sector.
Bureaucracy and interference in Diversified Computer Systems industry by
government.
Legal framework for contract enforcement
Intellectual property protection
Trade regulations & tariffs related to Technology
Favored trading partners
Anti-trust laws related to Diversified Computer Systems
Pricing regulations � Are there any pricing regulatory mechanism for Technology
Taxation - tax rates and incentives
Wage legislation - minimum wage and overtime
Work week regulations in Diversified Computer Systems
Mandatory employee benefits
Industrial safety regulations in the Technology sector.
Product labeling and other requirements in Diversified Computer Systems

Economic Factors that Impact Dell Technologies Inc.

The Macro environment factors such as � inflation rate, savings rate, interest
rate, foreign exchange rate and economic cycle determine the aggregate demand and
aggregate investment in an economy. While micro environment factors such as
competition norms impact the competitive advantage of the firm. Dell Technologies
Inc. can use country�s economic factor such as growth rate, inflation & industry�s
economic indicators such as Diversified Computer Systems industry growth rate,
consumer spending etc to forecast the growth trajectory of not only --sectoryname--
sector but also that of the organization. Economic factors that Dell Technologies
Inc. should consider while conducting PESTEL analysis are -
Type of economic system in countries of operation � what type of economic system
there is and how stable it is.
Government intervention in the free market and related Technology
Exchange rates & stability of host country currency.
Efficiency of financial markets � Does Dell Technologies Inc. needs to raise
capital in local market?
Infrastructure quality in Diversified Computer Systems industry
Comparative advantages of host country and Technology sector in the particular
country.
Skill level of workforce in Diversified Computer Systems industry.
Education level in the economy
Labor costs and productivity in the economy
Business cycle stage (e.g. prosperity, recession, recovery)
Economic growth rate
Discretionary income
Unemployment rate
Inflation rate
Interest rates

Social Factors that Impact Dell Technologies Inc.

Society�s culture and way of doing things impact the culture of an organization in
an environment. Shared beliefs and attitudes of the population play a great role in
how marketers at Dell Technologies Inc. will understand the customers of a given
market and how they design the marketing message for Diversified Computer Systems
industry consumers. Social factors that leadership of Dell Technologies Inc. should
analyze for PESTEL analysis are -

Demographics and skill level of the population

Class structure, hierarchy and power structure in the society.
Education level as well as education standard in the Dell Technologies Inc. �s
industry
Culture (gender roles, social conventions etc.)
Entrepreneurial spirit and broader nature of the society. Some societies encourage
entrepreneurship while some don�t.
Attitudes (health, environmental consciousness, etc.)
Leisure interests
Technological Factors that Impact Dell Technologies Inc.
Technology is fast disrupting various industries across the board. Transportation
industry is a good case to illustrate this point. Over the last 5 years the
industry has been transforming really fast, not even giving chance to the
established players to cope with the changes. Taxi industry is now dominated by
players like Uber and Lyft. Car industry is fast moving toward automation led by
technology firm such as Google & manufacturing is disrupted by Tesla, which has
stated an electronic car revolution.

A firm should not only do technological analysis of the industry but also the speed
at which technology disrupts that industry. Slow speed will give more time while
fast speed of technological disruption may give a firm little time to cope and be
profitable. Technology analysis involves understanding the following impacts -

Recent technological developments by Dell Technologies Inc. competitors

Technology's impact on product offering
Impact on cost structure in Diversified Computer Systems industry
Impact on value chain structure in Technology sector
Rate of technological diffusion
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Environmental Factors that Impact Dell Technologies Inc.
Different markets have different norms or environmental standards which can impact
the profitability of an organization in those markets. Even within a country often
states can have different environmental laws and liability laws. For example in
United States � Texas and Florida have different liability clauses in case of
mishaps or environmental disaster. Similarly a lot of European countries give
healthy tax breaks to companies that operate in the renewable sector.

Before entering new markets or starting a new business in existing market the firm
should carefully evaluate the environmental standards that are required to operate
in those markets. Some of the environmental factors that a firm should consider
beforehand are -

Weather
Climate change
Laws regulating environment pollution
Air and water pollution regulations in Diversified Computer Systems industry
Recycling
Waste management in Technology sector
Attitudes toward �green� or ecological products
Endangered species
Attitudes toward and support for renewable energy
Legal Factors that Impact Dell Technologies Inc.
In number of countries, the legal framework and institutions are not robust enough
to protect the intellectual property rights of an organization. A firm should
carefully evaluate before entering such markets as it can lead to theft of
organization�s secret sauce thus the overall competitive edge. Some of the legal
factors that Dell Technologies Inc. leadership should consider while entering a new
market are -

Anti-trust law in Diversified Computer Systems industry and overall in the country.
Discrimination law
Copyright, patents / Intellectual property law
Consumer protection and e-commerce
Employment law
Health and safety law
Data Protection

2.0 Sector Trends

The trends of the computer sector can be analysis by using PESTLE analysis which
consists of political, economic, sociological, technological, legal, and
environmental.

2.1 Political
One of DELL�s major intimidations is involving the fourth element of the external
environment, the political or legal environment. The Chinese government likes to
promote national PC vendors as compare to foreign companies and there are a lot of
formalities involved in securing government contracts, which shows that local firms
and companies in China is more preferable by the China government. Another threat
of Dell is that the internet usage is being controlled by the China government
which means the growth of internet is being limited.

2.2 Economic
The economic environment is the nature and economy direction in which a firm
competes or may compete. The problem of software piracy is the main threat that
computer companies suffer in China. China has a lot of economic opportunities as it
has the highest population amount, but the shortage of skilled labor is making
China to suffer. DELL is aware that cheaper system is more preferable in China.

2.3 Sociological
The social and cultural sector is follow closely with a society�s attitudes and
cultural values. Dell has the opportunities to expand into a new market as the
potential of internet growth in China is tremendous. At the same time, due to the
huge expense of computer, China people are still unsure about card sales.
Therefore, DELL has to offer door-to-door or face-to-face operations in order to
increase consumers� trust and consumers� belief in the company and product.

2.4 Technological
The technological sector consists of the agencies and activities which related with
inventing new technology into products, materials and processes. The main direction
of technology nowadays is everything become smaller and faster. Institution has
proven a key government resource by providing access to technologies developed. By
the year 2000, it was observed that the annual PC production in mainland China
would reach 7.6 million, making it the third largest in the world. With the help of
internet, companies have a great opportunity to get their name into the public area
plus a fast way to custom services to its customer segments. However, the high cost
of using internet in China has become a threat to Dell in the technology sector.

2.5 Legal
Dell was fined $4 million for fake and misleading advertising about PCs sold to
consumers in New York. While in New Orleans, there are two companies which claim
Dell is selling a surveillance camera system by conspiring with city officials.
This shows that Dell is being interrupted by the legality of their actions in
different countries.
2.6 Environmental
The target of Dell is to build a corporation culture for better awareness towards
the environment because of the values of environmental conservation, the efficiency
of eliminating waste which follows the values of the direct business model and is
more effective to deliver the value of customers.

Dell�s goal is to be a careful attendant of the environment and to execute programs

and processes to ensure the operations and products are environmentally friendly.
Other than that, Dell is also trying to make the neighboring environment in society
better for the people who work and to generate strategic partnerships with
organizations evenly dedicated to environmental objectives.

Dell�s direct business model guides their promise to straight meeting with
employees, customers and suppliers. Dell also engage in direct conversation with
the investment groups which are socially responsible, shareholder activists, and
many variety of nongovernmental groups that are looking for business meeting to
uncover the global way out for most of the public and environmental concerns.

PEST analysis for Acer in India and Germany:

Acer is one of the largest manufactures of computers, laptops, hand held�s, storage
disks n displays. The head quarter of Acer is in Taiwan and it posted a net revenue
of 19.9 billion US dollars in 2010. it has subsidiaries all over the world like
Acer India, Acer corporation America, Acer computer Australia, pack bell,e-machine
and gateway inc. In this pest analysis of Acer it shows all the factors in India
and Germany for the business opportunities. India is one of the fastest emerging
economics in the world with developing IT infra structure so extension n investing
more in India will provide Acer a greater value and demand for the products.
Germany is a developed country and biggest economics in euro zone and 70% of GDP is
contributed by service providers. So investing more in Germany makes more sensible.

POLITICAL FACTORS
Political factor which affect the business can be the rules and regulations by the
government towards the environment of business which is done by the computer
manufacturing company Acer. Indian government and German government have positive
attitude towards the Acer group. Because for the development of two countries IT
sector has a big role. not only , this acer groups all products are very affordable
for the people in two countries, and two government get more revenue through this
IT sector, so this is the political advantage of Acer group.

POLITICAL STABILITY OF INDIA AND GERMANY

When analyzing the political stability of two countries we can see some instability
in Indian government. This is because of changing of government in regular
interval. But it will not affect the foreign investors because Indian government
haven�t gone through a big change in foreign investment policies over this 20
years. German government is always stable, Because proportional representation from
different parties (from small and large parties). Because of these reasons Acer
groups are more likely to invest more and more money than which they had invested
in this two countries.

WAR AND CONFLICTS

War and conflict is another political factor which affect the business. some times
this war may cause break up in relation between the countries. Suppose if acer is
from china and they had large amount of investment in india and germany,Because of
the war between india and china. They will lose the whole amount of monet which
they had invested. and vice versa in case of Germanys war and conflict sometimes
will cause big lose for multinational business group like acer.

INTER-RELATIONS BETWEEN COUNTRIES

Inter relation between countries is also a political factor.if country like india
and germany have good relation with taiwa (home country of acer)they will get good
market in these two countries and because of the investment of Acer government get
more revenue.inter relationship will be in different types,like interrelation
between armed force and natural resources. two countries will get more benefit from
this

relation.

HOME MARKET LOBBYING AND PRESSURE GROUP

Every countries have its on home market for every products. When analyzing the home
market of Germany and India they have market lobbies in their countries like APPLE
in germany and HCL in India�s these two countries will resist the new comers in the
market .so they will give pressure to government to resist the other new companies
from abroad by giving bribe for ministers and political leaders.So ACER will cross
all this bridges to become more success full in every country.

Economic factors:
Economic factors are the major concerns of Acer because demand, price levels, cost
and profits depends on it. Factors like economy, GDP growth, taxation, interest and
exchange rate, inflation etc� Plays a vital role for the growth of a firm. These
factors are important to achieve short and long term goals in international
environment of Acer.

GDP:
GDP growth of India is increasing at the rate of 8-9% per year, in Germany it is
under .50% which is lower when compared to India. As India is emerging market it
provide a big business opportunity.

Interest and Inflation rate:

In India Interest and inflation rate is 5.50% and 9%, whereas in Germany it is 1%
and 2%. These rates in India are major concerns for company like Acer.

Taxation:
Tax rate for firms in India and Germany remains the same 30-33% but VAT in India is
12.5% but in Germany it is 19%.so there is a slight advantage for Acer in India
over Germany in taxation.

Business and consumer confidence:

Business and consumer confidence levels of a country helps in development of firm.
In India business confidence level is 159 and consumer confidence level is 73. But
in Germany it is 111 and 18 respectively.

Government spending:
Government spending is the spending of money to that country related to GDP. In

both these countries government spends more money than it getting in. Budget
deficit equivalent to 5.10% of GDP in India, whereas in Germany it is 3%.

Unemployment rate:
Jobless rate in India and Germany are moreover same. It is 8% in India and 7.5% in
Germany.

Currency and exchange rate:

The currency of India is rupees but in Germany it is euro. So operating cost of
India is lower for firms.

Per capita income:

Per capita income of Germany is 25473 US dollars. In India it is just 718 US
dollars which is very low when compared to Germany.

Social Factor
Social factors mainly include soci-cultural factors of different countries. Each
country has its own socio-cultural factors. The main social factors that includes
in a country are consumer attitudes, education (literary rate), population,
cultural aspects, living standard and demographics

Marketing Strategy of Acer

As India and Germany exhibit more or less same level of target group, the number of
difference in the marketing strategy it take into account is through

Online shopping through companies authorize website, other networks like e-bay

Through companies authorize outlets, shops

Tele -commerce

Festive season the products are sold for discounts, some vouchers & after sales
service

Consumer attitudes
For a company like Acer they value their consumer very much. The consumption
pattern of a country mainly depend upon their liberalisation, buying behavior of
youngsters, rapid increase of nuclear families. so the company has a good growth in
India and they will get lot of consumer. In India and Germany the new generation
doesn�t mind in spending money for better facilities and new products.
So Acer has a got a good number of consumers in India and Germany

Education
Germany is standing 21st country in literary rate and India is standing 149th rate.
India literary rate is 66% and Germany it is 99%.If the consumers in a country has
good literate rate they may use modern gadgets. They may use the update versions.
Most products of Acer is depending upon the adults and youngsters.

Population
Population of India is 1,027,015,247 persons and India stands second in the world
after China. Although India occupies only 24% of the total world�s area; it
supports over 15% of the world�s population. Germany population is 8,154,500
persons it stands 10th rank in the world. If the population is more there is good
for the company Acer they may get lots of consumer. So Acer can concentrate more on
India as they may get a large number of consumers.

Cultural Aspects
Every country has got their own culture .The cultural factors include geographical
area, demographic ,economy,religion.The Indian economy is the world�s 11th largest
economy by nominal GDP and the 4th largest by purchasing power. Germany is the most
popular European country and 82.4 million inhabitants including 7.3 million
foreigners. So it is good for Acer Company to concentrate their sale in both
Germany and India. Both the countries have good purchasing power.

Living Standard
India living standard is not good as Germany. The standard of living of India is
very low about 35% of people live on less than US $1 a day. But know the growth of
various sectors like IT, Real Estate, ITES, has led to the improvement of living
standard. Germany living standard is high when compared to other western countries.
When living standard improves people will prefer more electronic good that is good
for Acer.

Demographic
India is the 2nd populated country in the world. India has more 50% of its
population below the age of 25 and more than 65% below the age of 35.In Germany 16
million people are of foreign/immigrant .so it is good for the company Acer to
concentrate their sales on the youngsters

COMPETING TECHNOLOGY DEVELOPMENT

Technological developments are one of the formulas which is essential for the
success of any industry and the country. In this case Acer companies technological
aspects is excellent than its competitors in the market. Technological developments
not only means renewal of technology but also innovations of new technology.

RESEARCH FUNDING
Research funding means granting money for the research works, it may be by
government or company itself. Acer is a multinational company and they don�t want
government money for the research. In Germany, government gives money for the
company for the research if it is helpful for the public. Acer invested millions of
money for research works in different countries.

REPLACEMENT TECHNOLOGY
Technologies are not stable always it will change time to time. This replacement
technologies are more in bi-medicals,mechanicals,electronics etc.In case of Acer
manufactures, they will always change the technologies and research for good one
then only they can stand stable in the field market.

INFORMATIONS AND COMMUNICATIONS

Now the world is going through the golden age, because earlier this type of
communication is not in the world. New technologies paved the way for this
situation. These communication facilities are very helpful for the countries to
develop in very large way. By use of internet and 3G system we can see and
communicate with other people living in other country this is the success of new
technology and

communication system. In communication base Germany is far better than India

INNOVATON POTENTIAL
Innovation is the process behind the success of every industry and every nation.
Everyone in the industry have the potential to find something .but the top
management will not give opportunity to prove that ability. but the things are now
changed, every business firm like Acer now give opportunity to workers to prove the
ability of them, and for that they uses brain storming method.

CONCLUSION
From the above report we can conclude that Acer products are continuing to grip up
with the competition from the rivals and making strategic analysis for making
subtle business strategies to make it more enriched with top technological boost in
its product in both the countries India and Germany. The Acer company has got the
stability in political,economical,social and technological factors that prevails in
the business environment of the country .By producing innovative products they got
to survive in the market efficiently.

PESTEL/PESTLE Analysis of Lenovo

Lenovo, the largest PC maker in the world has registered some magnificent wins over
a short period of time. Since its incorporation in 1988, the brand has grown a lot
and managed to retain a market share of 21% even in a period when the entire PC
market is facing a decline. It makes a large range of products and IT solutions.
The fast growing Asian markets are its stronghold but in case of the European and
developed markets, Lenovo may still need to grow its presence there. The decline of
the PC industry is affected by several factors. The aim of the technology brand is
to grow into the world�s largest technology company. However, there are several
forces which need to be in favour to reach that position. The fluctuations in the
global and local economies are already creating difficulties. This is a PESTEL
analysis of Lenovo that analyzes how these various kinds of forces affect the
world�s largest PC maker.

Political:
The political factors have kept growing very important for businesses in the 21st
century. If the Chinese market is a stronghold of Lenovo then there is a major
role of the political forces behind it. China is already known to favor the local
brands. However, around the world such situations have frequently come to light.
Even the American companies face difficulties while doing business overseas in
several markets. EU slapped fines over US technological giants for debatable
reasons. If Lenovo�s market presence is not as strong in the developed or European
markets, then the political environment is an important cause behind it. However,
political factors affect the international businesses in other ways too. For the
businesses operating in the global environment, political stability in the overseas
markets is very important. Political stability also means economic stability and a
stable business environment. However, political turmoil on the other hand does not
just disrupt sales but can also disrupt the supply chain and the distribution
system which is not good for any business� health. In this way, favorable political
climate means profitable business and high revenues whereas political disruption
means just the opposite.

Economic:
The global economic environment has changed a lot since the recession. Consumer
spending and employment level, both had given up. However, the situation is not the
same globally. Several economies are still caught in a poor situation which is a
threat for Lenovo�s business. In several emerging markets due to the significant
currency volatility, the revenue and profits of Lenovo are being affected. The
currency volatility is affecting the brands in the personal technology industry and
will continue to affect them. The severe macroeconomic challenges before Lenovo
along with the decline in PC industry will continue to have an effect on Lenovo.
Apart from these things there is intense pressure of competition in the PC
industry. Despite being ahead of the others, Lenovo will continue to feel the pinch
because the other brands too are behaving quite aggressively to gain their hold
back on the PC market. Price competition between the PC and personal technology
brands is also intense and the demand for the low cost models is higher. Thus, the
economic challenges are of major importance in the case of Lenovo.

Social:
Socially, the acceptance of personal technology has increased. Apart from PCs, it
makes a full range of personal technology products like smart phones, tablets and
smart TVs. It is also the second largest smart phone brand in China. While the PC
market has decline the smart phone and tablets have kept growing in sales. The
demand for personal technology is especially the highest among the millenials and
the middle class. They form a major part of Lenovo�s target market. These social
trends can have a major effect on the business of the international brands like
Lenovo. The hot trend of mobile computing is an opportunity for Lenovo which is an
innovative brand. However, society and culture are also major forces in this era of
globalization which do not just affect popularity of brands and their products but
require to be considered when crafting a marketing strategy. The growing importance
of design and mobility has also made it important that PC vendors focus on these
factors while releasing new products. The demand for detachable and gaming machines
is on a rise due to these factors. After all, the changing preferences of the
consumers must be considered for sales and profitability.