Running Head: PESTLE ANALYSIS
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4-2 Report: Business Environment Analysis
MBA 620
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
PESTLE ANALYSIS
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customer 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.
PESTLE ANALYSIS
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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
