PESTLE Analysis

A PESTLE analysis is a framework that analyses the macro-environmental factors that contribute to an organisation’s performance. It is an analysis that focuses on factors that, although external to the organisation’s operations, are still fundamental factors to take into consideration when conducting a  strategic analysis of the organisation.

In order to illustrate the thought processes behind conducting a PESTLE analysis, a brief analysis was carried out on Australia Post:

Assessing Australia Post’s Political, Economic, Social, Technological, Legal and Environmental factors, the following perceptions became apparent:

 

Political Factors:

 

Australia post is a Government Business Enterprise, but is commercially run and not subjected to any political instability issues.

 

 

Economic Factors:

 

Economic growth has slowed for Australia Post due to a number of factors, the most critical being the reduction in the need for the company’s main function of delivering mail to the public. Letters being delivered have fallen by well over 1 billion since its peak in 2007/2008 when it delivered 4.6 billion letters (Australia Post Annual Report, 2014). Furthermore, inflation and exchange rates has an effect on profits obtained through the company’s travel services including travel cards and international money transfers. Consumer confidence in Australia Post has dropped due to reduced days of delivery services, with non-urgent mail being delivered two days slower than the previous service and customers paying a premium for priority service (Australia Post, 2016). This has significantly affected Australia Post’s financial position, along with the additional stress of competition from agile courier companies that offer a more personalised service including regular contact during the parcel/mail logistics timeline such as DHL.

 

Social:

 

Lifestyle and consumer changes have left Australia post services chasing ecommerce market developments and struggling to stay relevant in today’s evolving retail and consumer markets. Australia post is realigning it’s organisational strategy to become a partner for Australia’s ecommerce market, with new alliances forming with emerging powerhouses within the market such as forming trade alliances with China wholesaler giant Alibaba to increase Australia’s overseas retail export markets, as well as locally through its partnership with Shippit to provide the Australian Public with a parcel delivery service reminiscent of the services provided by leading courier companies such as DHL and FedEx.

 

 

Technological Factors:

 

Development of new technologies in communications and billing have left postage services marginally redundant for larger companies that would once use Australia Post for all customer and client communication and billing. The use of email services for billing purposes and online communication methods has meant that Australia Post has had to evolve in order to update its products and services to curtail dwindling service usage. This has been done through strategic partnerships previously mentioned, and the introduction of a new product called MyPost Digital Mailbox which aims to recapture the billing market through providing a digital service to receive and pay bills, as well as securely store them for taxation purposes (Australia Post, 2016).

 

Rate of technology transfer to Australia Post is dwindling behind external market developments such that Australia Post is essentially chasing the market in most areas of technology. This is exemplified through the aforementioned MyPost digital mailbox only being developed this year, while online billing and communication has been successfully utilised by all Australian companies for multiple years prior to its development.

 

Legal Factors:

 

Requirement to deliver mail a number of times each week plus keep the 4000 retail outlets and post offices open is putting strain on the company’s financials and profit margins. Supply and demand for these services does not align with these regulatory procedures (Australia Post, 2014).

 

 

Environmental Factors:

 

Environmental regulations and protections have caused a reduction in the amount of paper bills and letters sent, also damaging Australia Post’s essential purpose for existing: sorting and delivering mail to Australia.

 

Enter your email address to follow this blog and receive notifications of new posts by email.


 

References:

 

Australia Post Annual Report. (2014). Retrieved from

http://auspost.com.au/annualreport2015/docs/australia-post-annual-report-2015.pdf.

 

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s