BMT - STEEPLE analysis

Define ‘STEEPLE analysis’.

An analytical framework used to examine the opportunities and threats of the social, technological, economical, environmental, political, legal, and ethical factors that affect business activities.

Outline what the mnemonic ‘STEEPLE’ stands for.

Social, technological, economical, environmental, political, legal, ethical

Outline the advantages of using STEEPLE analysis.

Simple to use, allows thorough and logical analysis, useful brainstorming tool, promotes proactive and forward thinking

Social: Outline the opportunities and threats of increased migration.

Provides greater consumer choice. Potential language barriers.

Social: Outline the opportunities and threats of the societal pressure to act morally.

Enhance image and reputation. Compliance costs.

Social: Outline the opportunities and threats of aging populations.

Innovate products for specific needs of older people. Decreased pool of talented labour available due to retirement

Technological: Outline the opportunities and threats of technological development for HR.

Job creation, new working practices. Job losses

Technological: Outline the opportunities and threats of technological development for Finance.

Reduced operational costs. Increased costs for product development.

Technological: Outline the opportunities and threats of technological development for Marketing.

New products, new markets. Shorter product life cycle.

Technological: Outline the opportunities and threats of technological development for Operations management.

Increased productivity. Shorter product life cycles, leading to increased pressure to innovate faster.

Technological: Outline the opportunities and threats of developments in Internet technologies.

Faster speed of access to information, reduced language barriers, increased productivity. Online crime risks, price transparency issues, staff demotivation

Economical: Outline the opportunities and threats of inflation.

Increased inflation increases costs rapidly. Decreased inflation increases costs at a slower rate.

Economical: Outline the opportunities and threats of unemployment.

Increased unemployment leads to fewer customers being able to afford products. Decreased unemployment leads to more customers being able to afford products.

Economical: Outline the opportunities and threats of economic growth.

Increase in economic growth increases customer expenditure. Decrease in economic growth decreases customer expenditure.

Economical: Outline the opportunities and threats of balance of trades.

More imports than exports causes export prices to decrease and import prices to increase. More exports than imports causes import prices to decrease and export prices to increase.

Define ‘Fiscal policy’.

The use of taxation in order to influence business activity.

Outline the advantages of expansionary fiscal policy.

Increases disposable incomes of consumers, encourages spending

Outline the disadvantages of contradictionary fiscal policy.

Decreases disposable income, discourages spending

Define ‘Monetary policy’.

The use of interest rates to influence business activity.

Outline the advantages of lowering interest rates.

Cheaper to borrow money, increased spending

Outline the disadvantages of raising interest rates.

More expensive to borrow money, decreased spending

Legal: Outline the advantages and disadvantages of competition legislation.

Copyright laws prevent competitors from copying inventions. Monopoly firms cannot engage in price fixing & charge excessively high prices (compliance costs)

Ethical: Outline the advantages of social audits.

Attract & retain high quality workers, attract new & retain customers, good publicity

List the different factors considered when responding to changes in the external environment.

Size of business, ability of management, level of gearing, degree of brand loyalty, diversity of firm’s operations