Revision Notes

External: legal, social, political, technological

Legal covers employment (dismissal/redundancy as well as Trade Unions); consumer and business behaviour including company formation and contract law.
Social covers attitudes to work, honesty, type of product, employment procedures, leisure pursuits….
Political includes government policy on nationalisation/privatisation; intervention/non-intervention; single currency (or not); fiscal (taxes/expenditure) versus monetary (control money supply = control inflation)
Governments: Conservatives tend to be non-interventionist, anti-Single Currency and pro Business.
Labour tend to be pro NHS, intervention; reducing poverty and will enact social legislation.
Technological includes development of robotics and the Internet.
The key is the impact these four (and economic) have on a business. Technological (for example) will affect staffing, communications, production process and products themselves.
The policies overlap e.g. Politics overlaps with Economic. If this delivers growth this may be through technological innovation. Legislation may reduce red tape for businesses stimulating growth. Legislation may also be seen as a political act.
Important to keep up to date with European Social, legal, Political and technological events too e.g. the October 2000 Human Rights Act.
When dealing with impact on a business we consider: (impact on) Personnel; Production; Finance and Marketing. We also consider the impact of the firm on the external environment.