Macro-Environment Social - Technological and Legal Aspect

Question: Discuss about the Macro-Environmentfor Social, Technological and Legal Aspect. Answer: Introduction The best way to analyse the macro-economic environment of any organization is to take up PESTLE analysis and bring out the political, economic, environmental, social, technological and legal aspect of the same. Through this project the PEST analysis on the airline industry of France has been shown. The king of sky in France is the AIRFRANCE a subsidiary of the France-KLM group. It was established during 1933 to connect France with different parts of the world. Recent data suggests that it employs nearly 70,000 people. It has been amongst the top notched air service supplier in the European airline channel. The PEST analysis to highlight the possible problem and way of success has been given below: Political Analysis: Political factor influencing the economy consists of amalgamation of several important factors like the stability of the government, taxation policy of the nation, deregulation policy, the trade regulation, health and safety laws and other such factors. It is not only the stability of the French government that would influence the French Airlines but also the global political stability (Belobaba, Odoni and Barnhart 2015). Due to the stable condition of the EU, Air France has been able to come up by signing the Open Sky agreement. Statistical data suggests that due to government control and their stability, this industry has seen an upward trend in the volume of revenue earned over the years. Economic Analysis: France is amongst the top 3 rank holder with Europe in terms of its economic size and the 6th largest within the world. It has generated around US$ 2.806 trillion GDP in 2013. Tourism is the major source of Frances GDP earning after the pharmaceutical industry. Hence, economically the country is in favour of airline industry. The general global airline industry faced some issues in the recent years due to the instability of oil price (Ho 2014). Oil being the only fuel needed to run a flight has been the primary cause of the turmoil that the Frances air industry faced. Therefore, it can be stated that the countrys economic condition has always been and is still in favour of airline industry. Social Analysis: The airline industry is strongly dependent on customer service. The high level commitment from the group of customer service personnel is the major opportunity that the airline industry of France has in its forte. At the same time it has been observed that there is strong unity within the working personnel in the country. Often in times of stress the aviation industry has faced serious resistance from their workforce whenever the company decided to lay off employee (Berghofer and Lucey 2014) . Hence, the unionized crew acts more as a bane than being a boon in case of Frances airline industry and is a serious threat to the entire industry. Technological Analysis: In modern times technology has been shaping every domain within the world and the airline industry of France has been no exception to this rule. Due to improved technology, arrival of video conference system and robust improvement in information transformation through high level digitalization, AirFrance and other airlines within France has been seeing a downfall in their volume of passenger travelling for official purpose (Albalate, Beg and Fageda 2015). On other hand, AirFrance is trying to improve its service through RD. They are trying to bring in innovation and low cost fuel substitute but this requires time and in the short run is going to adversely impact the revenue of the company. Hence, it can be concluded by stating that the air industry in France has been benefitted and supported by the government and economic condition of the nation whereas it has to face problems in the social and technological domain. References: Albalate, D., Bel, G. and Fageda, X., 2015. Competition and cooperation between high-speed rail and air transportation services in Europe.Journal of transport geography,42, pp.166-174. Belobaba, P., Odoni, A. and Barnhart, C., 2015.The global airline industry. John Wiley Sons. Berghfer, B. and Lucey, B., 2014. Fuel hedging, operational hedging and risk exposureEvidence from the global airline industry.International Review of Financial Analysis,34, pp.124-139. Ho, J.K.K., 2014. Formulation of a systemic PEST analysis for strategic analysis.European academic research,2(5), pp.6478-6492.