A MANAGEMENT REPORT ON THE BUSINESS ENVIRONMENT OF ASHTEAD PLC
The present study is conducted on the basis of comprehending the importance of external business environment analysis. In the appraisal of the analysis, using PESTEL framework as an effective industrial tool is also credibly researched and included in the discussion of the present study. With the application aspect of the framework, the aspect of conducting the external environment analysis and how that helps the companies like Ashtead PLC to effectively identify their business strengths and threats to effectively work on them accordingly. The present study also helps to have the discoveries of the effective ways to conduct credible business within the company and how the organisation could possibly gain competitive advantage understanding the market fluctuation, consumer changes, transition in the business environment. With the involvement of the PESTEL tool, how companies like Ashtead PLC could possibly adapt into those changes are an integral aspect of the present study while providing real life examples of the effective application of the PESTEL factors into the organization.
Table of Contents
The present business report would attempt to analyse the external business environment of Ashtead PLC, one of the biggest industrial equipment industrial companies in the UK. By analysing and comprehending the organisational structure of the company, the present report would intend to document the internal aspect of the organisation and how the company is governed and how the structural division is conducted within the disciplines of the company. The involvement of executives, the chairperson or the senior board members and how their position allows the company to get governed systematically something that contributes to the developments of the companys overall expansion. With the involvement of the PESXTEL framework, the effective analysis of the external business environment of Ashtead PLC would be conducted to effectively identify and understand how the company externally functions. With the effective demonstration and theoretical explanation of how the PESTEL factors could be applied to the company is also going to be an integral aspect of the present business report. With the effective elaboration of how the factors could be applied to Ashtead PLC, the present report would attempt to establish the conceptual relevance of the study are, the relevance of effective business and the functionality of the external business environments of the company.
One of the biggest and its reputable industrial equipment rental companies, Ashtead PLC, is considerably provides services with quality and integrity since its foundation in 1947. Based on primarily London, England, the company is listed in London stock exchange (Ashtead-group.com. 2021). The company operates internationally providing services across the United states of America, Canada, and the United Kingdom (Ashtead-group.com. 2021). With the help of the subsidiary Sunbelt rentals, the company earns and generates 85% of their revenues from the United States itself. Currently six hindered location of the sesame is available collectively in the US and Canada of Ashtead PLC. Formerly known as A-plant, Sunbelt rentals is one of the sections of the company that heavily operates across the USA and Canada (Ashtead-group.com. 2021). The company heavily provides quality products and quality tools that are effectively for conducting quality industrial operations without nay interferences. Geoff Dabble has been serving as ne of most effective leaders in the history of Ashtead PLC (Ashtead-group.com. 2021). Until November, 2018 the company has announced that Geoff Dabble is retiring from his designation after twelve years, and succeeded by Brendan Horgan how joined as the COO and chef executives of the Sunbelt Rentals of the company smothering that had elevated the companys standards to a great extent allowed them to have proper organisational structure and integrate their rental services extensively without any operational inconveniences (Ashtead-group.com. 2021). With the presence of proper history of quality rental and credible services, the company has been able to provide their consumers and industrial units to receive considerably consistent services throughout its active years (Ashtead-group.com. 2021).
The company is able to conduct the overall development with the aspect of hierarchical structure where the company is comprised of non-executive chairman, the chief executive, the finance director, the senior independent-executive directors within the disciplines of the company, and the other four non-executive directors (Ashtead-group.com. 2021). Having Brendon Horgan as the company chief executive officer, and Paul Walker as the non-executive chairperson are some of the integral aspects of the company that helps keep the governance structure of the company consistent and deliberately developed. Comprising of independent non-executive directors, the audit committee of Ashtead PLC has Angus Cockburn as the chairperson where four other independent non-executive directors in that committee (Ashtead-group.com. 2021). The remuneration committee has Lucinda Riches as the chairperson along with four other directors where the committee members have no personal financial interests, instead they primarily focus upon with the help of the chief executive officer Brendon Horgan, to implement existing policies and policy proposals (Ashtead-group.com. 2021). The committee primarily performs all the series including the proper incentive deliveries to the executive management, to enhance the performance in fair and responsible manner (Ashtead-group.com. 2021). The remuneration committee members also review and determine the total remuneration packages while ensuring compliance with statutory and all the regulatory provisions. Having Paul Walker as the chair of the company the company has also other six committee members in the nomination committee and finally the financed administration committee comprise of Paul Walker, Michael Pratt, Brendan Horgan (Ashtead-group.com. 2021). Michael Pratt is the chief financial officer of the company where Angus Cockburn is the Senior independent non-executive director, who is also the chairperson of the audit committee (Huang and Bae, 2018). Jill Easterbrook and Tanya Fratto are two independent non-executive directors for the company Ashtead PLC (Ashtead-group.com. 2021). Lucinda Riches and Lindsley Ruth are also the two most reputed independent bon-executive director that helps all the relevant committees of the company to stay functional and effectively contribute to the developments of all the organismal structure (Ashtead-group.com. 2021). By agreeing with the agendas, the company board members enable the company stay effective by acquiring timely, accurate and consistent information overall on various aspects of the groups business (David, 2019).
The aspect of having the PESTEL framework to effectively comparand the external elements of any business be it a start-up or an established one, it allows the company to gain and acquire all the effective insights something that help the company to gain some of the biggest information and utility aspects of any organisational resources (Campbell, 2019). By identifying the changes, the PESTEL framework helps any organisation to effectively conduct and organise the understanding of al the external factors and the possible changes that are occurring in them (Boddy, 2016). These changes are quite frequent and the transition is quite consistent and frequent something that contributes to the development of the effective business analysis and also help the company to gain competitive business advantage and business sustainability. The overall dynamic of the company and their effective analysis of the company is something that is extremely relevant and with the help of the PESTEL framework (Bagchi et al. 2020). The relevance of the framework is even more important when the company is operating on a global scale and an international level something that is extremely important for the routine usage of conducting the PESTEL analysis for the company. Understanding the external forces and the influence of the same within the organisation and how it affects the company is also something that becomes possible with the involvement of the PESTEL framework (Baeten and Van Hove, 2021). The overall establishment of the PESTEL analysis company executives to identify the opportunities and the treats that helps them to effectively work on the facts instead of any organisational assumptions something that helps with the overall organizational developments. Using PESTEL framework as a tool, it enables the organisation to understand the market growth and identify the position, potential and all the immediate business directions to assess the business and organisational unit (Gonzlez, 2019).
Figure: Conceptual diagram of PESTEL analysis
(Source: Shtal et al. 2018)
The aspect of carrying out PESTEL analysis allows organisation from small to the big and giant corporation to effectively comprehend the external influences something that allows the company to identify the potential opportunities. With the early identification of the opportunitys utilisation of the same could be increased and while the mitigation of the risks could possibly be conducted with the help of the PESTEL framework (Yusop, 2018). The acronym for political, economic, social, technological, environmental and legal factors these factors is some of the most relevant elements of the external business environment of any organization. By identifying the key elements, and them effectively incorporating them into the business valuation, helps the organisation to gain competitive advantage and create sustainable business for long-term profit by carrying out the PESTEL analysis. The cost effectiveness of the PESTEL framework and the deeper understanding that tit provides for the company are some of the many important aspect of the PESTEL analysis (Shtal et al. 2018). IT helps the company experts and the quality management team to gain business insights into the external environment of the organisation and its business and create alertness developments throughout something that determines the success of the companys business on a global scale (Shmatko et al. 2018). The aspect of effective exploitation of the business opportunities become a possibility with the involvement of the PESTEL analysis something that helps the company to gain business sustainability and create an effective business environment something that serves both the company own, members and the community people involved in it. In terms of assessing any particular product or services of the business PESTEL as a measurement tool helps ad enables the company to effectively conduct the business evaluation within the given time frame of the business (Sharko et al. 2017).
PESTEL analysis framework has six constituent elements that are political, economic, social, technological, environmental and legal. These six elements have several factors that fall under each element that are extremely relevant and contributes to the overall developments of the company effectively and constitute to the overall developments of the company. The political factors of Ashtead PLC include factors such as the trade restrictions, tax policies, tariffs and bureaucracies (Roy and Chowdhury, 2021). The overall aspect of going or conducting internal business operation compel the company to take care and monitor their political areas while conducting business beyond the territorial borders (Pan et al. 2019). The company heavily operates under the name of Sunbelt rental where the company is working with over 600 stores in the USA and across Canada. The diverging views of the different political parties of different dimensions of the countries affect and influence the overall aspect of business of the company. The changes in strategies due to the different views of the political leaders also changes the polices and trade and taxation policies something that eventually affect the company and its overall business (Nurmi and Niemel, 2018). The economic element includes factors such as interest and exchange rates, inflation, economic growth and unemployment rates. The economic outlook of the company is definitely one of most crucial aspect and influences that affects the overall business of the organisation.
Figure: Sustainability analysis of PESTEL framework in the context of Ashtead PLC
(Soruce: Pan et al. 2019)
The social element of the PESTEL framework involves factors such as cultural aspects and perception, health consciousness and population growth rates, age distribution and career attitudes (Needle, 2015). These areas some of the most relevant aspect of the organisation that helps the company to effectively conduct the and understand the relevant social understanding highly influenced shaped by the population. The technological factors are research and development activities, automation process and technological incentives, and the change rate in the overall aspect of technology. Digitisation of the company at a for a quick and smooth accessibility is one of the many impacts that consideration of technological factors makes happen (Morrison, 2020). Finally, environmental factors such as temperature, climate change, pollution, weather conditions and natural calamities or disasters are also effective in terms of the external business of the company. The legal factor involves industry regulations, labour laws, licence permit, and seen the intellectual property hat help the companies like Ashtead PLC to conduct and establish the safety standards within the disciplines of the company (Montoya-Cruz et al. 2020).
With the involvement of the PESTEL analysis, Ashtead PLC can potentially facilitate so many of their operational aspects something that could potentially help the company to effectively contribute to the development of the organisational improvement (Kotlyk and Jamal, 2018). With the involvement of the effective strategic team and the application of the PESTEL factors in the most appropriate places of the company would help the company to effectively gain its marketing position in the competitive market (Huang and Bae, 2018). Some of the most effective ways how each factor could be applied into the suitable areas of the organisational operations would eb discussed in the section. For instance, political factors of Ashtead PLC include factors such as the trade restrictions, tax policies, tariffs and bureaucracies would help monitor their political areas while conducting business beyond the territorial borders. It would also help the company predict all potential regulatory threats something that could be effective for the company to avoid any potential danger potentially detrimental for the overall organisational operations (David, 2019). The economic factors such as interest and exchange rates, inflation, economic growth and unemployment rates would allow the company to comprehend the slowing down process of the various sectors or even when the market is picking up and optimising, with that piece of information it would allow Ashtead PLC to effectively adapt and would not get influenced without nay interferences (Campbell, 2019). Then application of the economic factors would also allow the company to identify the economic fluctuation and price inflation or deflation something that would help the company to adapt accordingly with the market economy (Boddy, 2016). With the application of the social factors of the PESTEL framework such as cultural aspects and perception, health consciousness and population growth rates, age distribution and career attitudes would help Ashtead PLC identify and recognise the changes occurring in their consumers or the end users effectively something that could potentially help the company business and change or adapt into the changes accordingly to effectively conduct the business (Bagchi et al. 2020). With the application of technological factors such as development activities, automation process and technological incentives would help the company to identify if the target market is prepared for any launching of new products or the eservices by the company (Baeten and Van Hove, 2021). The legal factors and its effective application would enable the company to comprehend the rules and regulations to be met by the organisation in order to sell the products to the consumers or to provide rentals to the industries. The application of environmental factors within the disciplines of the organisation would help them look at organisation or view the products and services in the context of a sustainable and delicate environment. Since change is global issue producing and manufacturing environment friendly products would help Ashtead PLC to boost their brand values (Gonzlez, 2019).
With the implementation of the PESTEL framework, the present business report has considerably explored the areas where the factors from the framework could be applied in the context of the company- Ashtead PLC. It is very relevant that a company is able to use and utilise the framework as an effective tool to extensively analyse and evaluate the external business environment. With the application and hypothesising the application of the factors of the framework has helped the present report to find how effective it could possibly be for Ashtead PLC and how that would benefit their business. It has helped identify the company to effectively find the ways to identify company strengths and the potential threats earlier in the operations something that has helped the company to effectively to conduct the business operations to effectively comprehend the external business environment without any interferences.
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Gonzlez, C., 2019. Transnational Board Interlocks as a Source of Nonexperiential Knowledge for the Firm in Foreign Markets.British Journal of Management,30(2), pp.459-472.
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