In PEST analysis, the macro-environmental factors affecting the operations of an organization are examined. The macro-environmental factors include political, environmental, social-cultural, and technological factors (Williams & Green, 1997). In this research paper, the writer wishes to undertake a PEST analysis of the computer industry in Canada. In this case, the political, economic, social/cultural, and technological factors affecting the computer industry in Canada shall be evaluated.
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Political factors consist of the legal issues and government regulations that define a given industry and the different players in it (Williams & Green, 1997). There is a need for companies to adhere to these rules and regulations for the smooth operation of their business activities. Canada enjoys a stable government, and as such, the government is less likely to interfere in the operations of a business establishment. However, in case a company fails to abide by the established legal framework, the Canadian government may need to get involved. Canada has strong intellectual property laws, and these are aimed at safeguarding the interests of investors. They also encourage competitiveness, effectiveness, and efficiency (The Treasury Board of Canada secretariat, 2009).
Economic factors include inflation rate, currency exchange rate, saving levels, debt levels, income growth, and consumer confidence, among others (Williams & Green, 1997). The recent global financial crisis had a devastating effect on various sectors of the economy globally. The computer industry in Canada has not been spared either. As such, any company willing to invest in Canada will have to consider the rising rates of inflation, fluctuating currency exchange rate, and the country’s income growth rate. The global economic crisis has resulted in slowed business investment and decreased use of PCs (Shah & Dalal, 2009).
However, the Canadian government is keen on stimulating the country’s economic growth (The Treasury Board of Canada secretariat, 2009). To attract foreign investors, the government hopes to provide incentives that will make it attractive to start or expand businesses in Canada.
The social/cultural factors influence the choices that consumers make when purchasing a particular good or service. Examples of social/cultural factors are attitudes, values, and beliefs (Williams & Green, 1997). The changes associated with social, cultural factors determine the purchasing behavior of the people. The rapid growth and development of ICT in Canada are indicative of people who appreciate ICT.
For example, a lot of people in Canada accept computer games and consoles (Dyer-Witheford & Sharman, 2005). This is a clear indication that the sector and country at large are committed to developing the computer industry. In addition, since only a handful of companies have invested in the country’s computer hardware (Doyle, 2011), it would be appropriate to invest in the Canadian computer industry.
These factors are concerned with the changes that a company experiences in a given industry as a result of advances in technology (Williams & Green, 1997). According to Shah and Dalal (2009), technology has transformed various sectors of the economy. Canada is a competitive market, and the country’s ICT industry is committed to ensuring that the market remains so. As a result, a lot of research and development initiatives have been spearheaded to help transform the sector (The Treasury Board of Canada secretariat, 2009). This will definitely boost the industry and encourage more investment (Doyle, 2011).
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Doyle, J. D. (2011). Computer Industry. Web.
Dyer-Witherford, N., & Sharman, Z. (2005). The political economy of Canada’s video and computer game industry. Canadian Journal of Communication, 30(2), 187-210.
Shah, A., & Dalal, A., (2009). The global laptop industry. Web.
The Treasury Board of Canada secretariat. (2009). Web.
Williams, T., & Green, A. (1997). The business approach to training. Brookfield, Vt: Gower.