Business Strategy

Section 1．External Environment Analysis for Sage Ireland

-Where we are now

First of all, we give a detailed analysis of macro-environment, using two different approaches, which are PESTLE analysis and Porter’s Diamond model for our client – Sage Ireland.

Macro-environment analysis for Sage Ireland

1. ‘PESTLE’ analysis for Sage Ireland

The macro-environment describes all factors which influence the company as a whole, but are out of their direct control including wider social, political and economic factors (Hooley, 2004)

Table 1.1 - PESTLE Analysis Model

Table 1.2 - PESTEL ANALYSIS FOR SAGE

* Political

Sage Ireland is one of the leading business management software and services suppliers to small and medium size enterprises (SME), the nature of the business decided that the quantity and quality of SME, political decisions towards SME have an indirect impact on Sage’s marketing strategy.

* Irish policy--In Ireland, 99% of enterprises is SME, value weighted 55.6% which highlighted the importance of SME in Irish economy especially in this recession. Irish government is taking a very positive role in encouraging the development of SME. A new government agency will be established to ensure major Irish banks lend to small firms, in an effort to reboot business activity.

* EU Grants--There are over 300 grants available through the EU to Irish businesses to help support their IT growth and innovation. Within Ireland alone, European Grant Advisers (EUGA) will support SMEs in accessing over 100 separate EU and Irish Start Up and Business Development funding schemes, ensuring increased awareness of, and access to, business capital.

* Economic

In this worldwide recession, Ireland appears to be particularly hard hit, with the economy set to shrink by 5% - by far the weakest performance in the euro area except Iceland and Greek.

* Collapse in the Housing Boom.

Because of the low interest rate which makes credit cheap and easily...