The business environment. PEST Analysis

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1 January 2016

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Logica is an innovative IT services organization which brings technologies, people and business together. It has clients globally in various industries; automotive, gas, oil and manufacturing.

Its aim is to add value for clients via, for instance, reducing waste or improving productivity and efficiency.

Political factors

           This refers to the various ways and to what degree does the government intervene in the business economy. Logica has to adhere to all government tax policy; when the government increases the tax levied on a particular product in the business, price adjustment should be done so as to ensure that the business does not run at a loss especially pertaining that certain product. The company will hire personnel and the working terms and conditions must conform to the labor laws. The environmental law should be followed by the company and all the activities must be friendly to the environment. Trade restrictions and quotas are very eminent in most nations. The government will restrict trading of some commodities which are illegal n the country. The company must ensure that it trades with those products which are legal and have minimal negative effects. Political stability influences determines the operations of most businesses. A positive business growth is facilitated by a politically stable environment; while political instability discourages business growth.

When the UK government increased university fees, (this affected the education sector) the academic providers had to address the challenges of generating income; Logica noted that this educational landscape alterations could impact on the number of potential employees with the skills and competencies required.

The increasing academic cost may restrict the social mobility of talented people hence may consider alternative routes to gaining experience and qualifications.

Logica has reviewed its workforce planning to have effectively skilled workers now henceforth. To cater for the changes, it has introduced apprenticeships and enhanced its graduate scheme thus provides the company with a new pool of talents especially IT and Computer Science specialists.

About government initiatives on climate change and reducing emissions, Logica responded by being involved in the government’s new Cycle Hire Scheme in London.

Logica’s role is central and focuses on the design and build of the simple-to-use payment system which is supported by a back office function (Palmer, & Hartley, 2006, p.18).

Environmental factors

           The environment of logical has many elements which are paramount for thrive of the business. The customers of this business are key, and should have their needs met. The company should offer high quality products at reasonable fee. The creditors and suppliers of the business should be paid on time for their supplies. Technology is very critical for all the services offered by the company. The company must acquire the latest technology so as to meet all the needs of the customers. The government is another environment which the company will operate in. it should follow all the government regulations set up for the industry. Last but not least are the competitors. The company will face stiff competition from other firms. The company must come up with strategies that will make it have a competitive edge over the competitors. The company can be more competitive if it provides quality products, offer competitive prices, and respond positively to the needs of the creditors and suppliers (Cherunilam, 2010, p.38).


           Effective knowledge of the aspects that affect the business operations will enable the business to make appropriate decisions that can facilitate its survival in the new environment without undergoing losses.


Cherunilam, F. (2010). Business environment. Mumbai [India: Himalaya Pub. House.

Palmer, A., & Hartley, B. (2006). The business environment (5th ed.). Maidenhead: McGraw-Hill Education.

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"The business environment. PEST Analysis" StudyScroll, Jan 1, 2016.

"The business environment. PEST Analysis" StudyScroll, 1-Jan-2016. [Online]. Available: [Accessed: 2-Oct-2023]

StudyScroll. (2016). The business environment. PEST Analysis. [Online]. Available at: [Accessed: 2-Oct-2023]

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