Analisis Interno Y Externo Empresarial De Un Broker De Bolsa

Post Graduate Diploma in Strategic Management Level 7

Business environmental Analysis

Course Leader: Dr. Vanessa Scholes

STUDENT: MSC. ENG DIETRICH TRUCHSESS R

STUDENT ID: 3803477

AUCKLAND, MARCH 2013

NZMA TUTOR JENNIFER NAEEN / MARTIN SZECO

MAY 9TH 2013

BUSINESS ENVIRONMENT ANALYSIS OF A STOCK MARKET COMPANY

1. ABSTRACT

At the present time the company I represent “NZ Investors Ltd” as any brokerage firm is looking for new clients in the stock exchange worldwide, in order to demonstrate leadership, being a cutting edge with aggressive policies and giving confidence to all its customers. It is necessary to develop tools to analyze the business environment of these companies the clients will trade. This analysis based on internal & external point of view. In this case, one of the overseas clients is trying to invest in Beca Construction (BECA), but it is necessary first to analyze its business environment to achieve a satisfactory inversion. The client is considering to analyze a 10 years long term investment. To achieve this, the firm I represent, will develop a tool to analyze the competitive business environment of BECA construction , which in the future, I will call it only BECA, its internal and external issues along with its competitive advantage. By combining PESTEL, SWOT frameworks, I will create a new model called PESTELI-TOWS and the competitive advantage will be analyzed using PORTER framework. Once the model summarizes the external & internal issues of Beca Construction, I will determine its competitive business environment for the 10 years. I will determine all issues of the new model such as political, economic, environmental, industrial, threats, weakness, opportunities and the consequence of these elements in relation with BECA and its possible consequences. This will allow the client from overseas, to visualize the strategic position of the organization, orienting efforts and determining if an investment is achievable, producing effectiveness & efficiency, in the performance of its financial activities. In this sense, the study will give the client information to develop a strategic investment with BECA knowing if it is worthy or not to invest in the mean time.

1. QUESTIONING TO DEVELOP THE BUSINESS MODEL.

A stock broker is an independent organization that offers all the necessary facilities for its members, following the mandates of their customers, enters orders and conducts negotiations for buying and selling securities. Understanding by securities, shares of companies, raw materials such as gold, silver, oil, corn, coal and anything that could be traded where it could be a profit. To explain what these instruments consist of and how to predict the behavior of such securities, is not the intension of this article because it is for organizations with a minimum knowledge of the stock market trading. New Zealand Investors Ltd NZI, the company I represent, has clients who invests in shares around the world, and it compulsory to provide financial advice to them. To perform this task, it is vital to analyze the business environment of many companies to predict if shares will rise or consequently will go down. Based on the above on question comes to stage: How does NZI can provide more confidence to its oversea client along with more business opportunities in order to invest in BECA's shares? The answer to this issue is to develop a tool which analyzes the business context of BECA in order for the client to trade its shares in the NZ stock market. As known the stock market is a world highly dynamic and incredibly unpredictable, so, the question is what best tool adapts to the stock market trading environment? No tool fits perfectly when it is analyzed BECA's business environment, and to answer this questions it is essential to find a theory, or a combination of different theories that evaluate its dynamic environment. In this sense, it is compulsory to analyze the internal view in order to develop a strategy within a ten years period. This is the time where the mission needs to be accomplished. Finally, it is necessary to analyze BECA’s closest competitors, in order to be a step ahead and always ready, trying to avoid future rivalry between all market forces.

As seen, all theories have limitations, but in this case, PEST would be one who best adapts to the stock market conditions because it adapts perfectly to the external issues that impact shares. To strengthen PESTEL's deficiencies, I will include the missing issues to perform a complete analysis. The question is: What are these missing issues?. PESTEL only considers external issues leaving outside the internal ones. This is the answer why this framework needs to be complemented with other framework who considers internal issues. What additional model then would it be used to consider these internal issues? SWOT is the model who best adapts to the internal issues because it analyzes the company, looking for the company's strengths and weaknesses and these are internal issues. What is the scope of PESTEL framework then? The strategic review process usually begins with the study of more common factors that affect the environment. The PEST model (short for Political factors, Economic, Social and Technological) analyzes the context of a company or business unit. (ALVAREZ, 2009).

Now, PEST & SWOT together, consider internal & external issues of the business environment of an organization. The question is: how to consider the level of competency of the company? In other words, how can I included in the new model? To analyze the level of competency, it is advantageous to include the PORTER framework mixed with the other two theories because it considers the business competitiveness strategies in a market (Investing Answers, 2013). In this sense, I may ask, how to assemble all these three theories in order to make the analysis in an easy way? Using a similar procedure as SWOT it is prudent to build a matrix which will be discussed in details later, in order to consider all issues in one framework. This makes easier its application by the analyst, as well as, avoids its dependency on the experience of the manager, giving the procedure a more objective criteria.

2. HISTORY

The history of this strategic planning tool is imprecise. The first mention of PEST tool is in 1967, by Francis Aguilar in 1967. He is the one who accredits with the origin of this strategic analytical approach. Aguilar talked about ETPS, which is the acronym of Economic, Technological, Political, and Social environment. They are the four factors that must be scanned to look for analytical grounds, to judge the strategic plans. However later, Arnold Brown, emphasized these same four environmental factors with the only difference that he labeled it as STEP. Referring to this acronym to each, of the four environmental factors, for Strategic Trend Evaluation Process, as well. Today, the common way to use the name for this external environment scanning procedure is PEST although it is also popular in its extended form as PESTLE (Thakur, Richter, 2010).

3. PAST EXAMPLES

Here is an example of a PESTEL analysis in a stock trading broker name Charles Stanley stockbroker and its political, economic, social, technology, environmental and legal issues are at the end of this report in the appendix part. However, the "...economic and environmental factors are currently having a remarkable impact on Charles Stanley firm due to the economic downturn. This highlights the importance of effective human resource management, leadership and ongoing communication to increase employee motivation at this tough time. Promoting equality, diversity and a work life balance... are arguably more pertinent now than ever before. This can contribute to getting the most from the workforce when resources are scarce, and the future is uncertain" (123HelpMe.com, 2013, para6).

4. QUESTIONING & CRITIQUE OF THE MODEL

Going forward with the analysis, the question is: what are the main criticisms of using PEST? According to (ALVAREZ, 2009), the explanation about how PEST will affect each of the factors to the performance of the company is exceptionally strong and bases on the analyst. Such analyst must possesses information about corporate strategy, environmental factors and their likely impact. Moreover, the social and political factors involved in PEST, sometimes shows unpredictable dynamic behavior. Therefore, these factors should be monitored continuously. It is complex to implement PEST model in highly diversified companies since the impacts are remarkably different in each business unit and it is difficult to determine their relationship. For example in 2002, the recession hit hard at Procter & Gamble, which saw a collapse in sales of its premium shampoo, Pantene. The Value Brand, on the contrary, increased sales of its economy brand, Plus Belle. Thus, simultaneously, the same factor was destructive and beneficial for both companies in the same industry. While it may seem above that companies are at the mercy of factors PEST model, they are also able to influence certain political, economic, social and technological changes with their actions.

PEST takes in consideration external issues but does not consider the internal ones; the question then is the following: Can PEST adapt to the business environment of an organization as BECA? Is PEST related to this case of study? As seen, PEST does not considerate internal issues

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