Running Head: PESTLE ANALYSIS
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4-2 Report: Business Environment Analysis
MBA 620
January 30,2022
SNHU
PESTLE ANALYSIS
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The PESTLE analysis framework has been used to perform a business environment
analysis of the TransGlobal Airlines business. The political, economic, sociological,
technological environmental and legal factors have been identified and their impact on the
acquisition strategy of the business has also been examined.
Political factor – The political factor that can impact the business environment of
TransGlobal Airlines includes the environmental standards relating to minimizing carbon
footprint in the environment (Safety Assurance System (SAS). Safety Assurance System
(SAS) | Federal Aviation Administration, 2021). This factor has the potential to mold the
business environment and encourage TransGlobal Airlines to focus on sustainable practices
that are adopted by the company that it intends to acquire in the Caribbean.
Economic factor - The economic factor that can impact the business environment of
TransGlobal Airlines is the foreign exchange rates which have led to an increase in its
Atlantic revenue by 0.8 % in the last quarter. The foreign exchange rates can impact the
acquisition strategy by influencing the cost that the business would incur by acquiring
Company A or Company B.
Sociological factor – The improved customer flying trend in the operational nations such as
Japan is a key sociological factor that can impact the business environment of the airline. The
rise in customer demand can enhance the profitability of the airline business and impact its
negotiation power during the acquisition strategy (Safety Assurance System (SAS). Safety
Assurance System (SAS) | Federal Aviation Administration, 2021).
Technological factor – In the digitalized era of the 21st century, the chief technological
factor that can impact the business environment of TransGlobal Airlines is the integration of
smartphone applications and software while delivering services to the customers. The use of
applications can create an opportunity for the airline company to transform the customer
PESTLE ANALYSIS
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experience relating to making reservations, booking tickets and other aspects. It can have a
possible impact in the acquisition strategy of the business by stressing the technical
capabilities of Company A and Company B. The company with higher integration of
technology in its airline processes and activities may gain an edge during the acquisition
process.
Environmental factor – The environmental factor that can affect the company’s business
environment is the emphasis on environmental practices in the aviation landscape such as the
use of fuel-efficient aircraft. The factor has the potential to reshape the business environment
in which the TransGlobal Airlines Company operates by emphasizing sustainability. A
potential impact that the identified environmental factor may have on the acquisition strategy
of the business involves the increase in the focus on the use of fuel-efficient aircraft in the
fleet of Company A and Company B. The company that adopts a more fuel-efficient approach
in the airline industry may have an edge over the other and its possibility to get acquired by
TransGlobal Airlines may increase.
Legal factor – The Federal Aviation Administration’s (FAA) Safety Assurance System
(SAS) is an important legal consideration that TransGlobal Airlines must focus upon while
operating so that safety can be ensured (Safety Assurance System (SAS). Safety Assurance
System (SAS) | Federal Aviation Administration, 2021). The legal factor relating to SAS can
impact its acquisition strategy as it would have to take into account the safety dimension
while acquiring Company A or Company B.
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References
Safety Assurance System (SAS). Safety Assurance System (SAS) | Federal Aviation
Administration. (2021). Retrieved January 25, 2022, from
https://www.faa.gov/about/initiatives/sas
