SG7001 – The external analysis

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7MARK001W International Marketing and Communications Management

External analysis

PEST analysis

Political: The organization structure is mainly controlled by the administrative body of the Thermax limited company. The major laws concerning the internal and external parts of management are implemented by the C-site officers of this organization. All the accepted business policies and norms pass through proper analysis and evolution before execution. The organization follows the partnership policy (Grant and Jordan, 2015). The trade restrictions are one of the major fundaments of this organization. The trading capacity is moderated and it highly impacts its market stocks. Economic: Like any other industrial company, Thermax limited company also faces several difficulties regarding economical usability. The economic growth rate is not stable for this organization as the net profit ratio is continuously declined after October. This company faced a market loss of 1.2 crores in February. The market condition of this company constantly deteriorates with the acceptance of new financial arrangements. Social: This represents the cultural and demographic trades of any organization. The
population growth rate is one of the major parts of this parameter. The continuous population growths flow highly affected the company’s internal structure body. As the numbers of job seekers are increasing and the vacancies in the company are almost fixed (Johnson et al., 2013). This instability may occur in a situation of unemployment. The management needs to adopt some required strategies to control this scenario. Technological: Technological representatives are associated with innovation activity in the production system involving the entire marketplace. If the company is not signifying upgraded to the most developed and most advanced trends of the particular activity field then it can be remarkably damaging to services. The company must aware of the market trends and consumers’ most recent demands. This activity is only possible by applying new technologies in production with maintaining the production cost for gaining more financial profits.

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Porter’s five forces

Rivalry in the Industry: The first section of these five forces introduces the representation of rivals and their capacity to underprice the company. The higher the representation of opponents, accompanying the number of comparable outcomes and co-operations the organization offer is the more inferior the capability of the company.

Inherent of New Entrants into the Industry: The company’s strength is also influenced by the effectiveness of new recruits in the marketplace. The more limited time and capital it gets for a rival to infiltrate the company’s business field and signify as an efficient opponent.

 Power of Customers: The experience that consumers have to encourage rates lower or their level of strength is considered as one of these five forces. It is influenced by the number of customers or clients Thermax limited company has and the significance of each customer to the company.

Power of suppliers: This sector also holds some significant prospects for the organization where it deals with the supplier’s specifications. It mostly overlooks the supplier’s size, number, quality, and more.

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The threat of Substitutes: This is noted as the last factor of the five forces. It mainly confuses the substitutes of the Thermax limited company. The production house of the company’s outcomes and services posture a threat (Slack et al., 2015). The organization produces goods services for the no solid substitutes that may have more potential to raise prices and secure in desirable terms.

Survival and the success factor for the industry

Survival and the success factor of every manufacturing company mostly depend on the strengths of the management and the circumstances that the organization gains in the upcoming future. The following parameters are displays the survival and the success factor of Thermax limited company:
Generating inherent division
Technological federation
Foundation rehabilitation.

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Reference list

Grant, R. M. and Jordan, J. J. (2015) Foundations of strategy. 2nd edn. Chichester: Wiley Johnson, G., Whittington, R., Scholes, K., Angwin, D. and P. Regnér (2013) Exploring strategy text & cases. 10th edn. Harlow: Pearson

Slack, N., Brandon-Jones, A., Johnston, R. and Betts, A. (2015) Operations and process
management, 4th edn. Harlow: Pearson.

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