Running Head: ENTREPRENEURSHIP

ENTREPRENEURSHIP
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Table of Contents
Introduction......................................................................................................................................2

PESTLE analysis.............................................................................................................................2

Political factors............................................................................................................................3

Economic factors..........................................................................................................................4

Social factors................................................................................................................................5

Technological factors...................................................................................................................6

Legal factors.................................................................................................................................7

Environmental factors..................................................................................................................8

Reasons of new ventures failures....................................................................................................8

Lack of management experience..................................................................................................8

Poor level of financial management.............................................................................................9

Conclusion.......................................................................................................................................9

References......................................................................................................................................10
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Introduction
Start-up business requires the huge amount of work, time, and money. This is important for them
to follow the guide and evaluate the all practice. Conventional startup ideas turn into widely
successful businesses. PESTLE method is utilized as the important part of strategic level
planning or risk management procedure and provides the important level of insight to user about
what is present within the environment as well as what should be considered within the light of
all these elements. This kind of analysis supports to understand market for organization, position
for business, strategic plan, and complete the market research within the present and new market.
It enables to develop the strategic thinking and supports to evaluate how strategy will fit within
the broader atmosphere. This enables the leaders to work with the critical external influences of
organization. It supports to create decision decisions and knowledgeable decisions. PESTLE
analysis will remain effective in case of new IT start-up business within the nation like South
Africa.

PESTLE analysis
PESLTE analysis is an effective approach or tool utilized to evaluate and monitor regularly
macro-environmental elements which have the profound effect on performance of organization.
This kind of tool is particularly important when beginning a business and entering within a
foreign market. This is utilized often in alliance with many other analytical business techniques
like SWOT analysis and Porter’s Five Force analysis to provide the appropriate and clear
understanding regarding the situation as well as related internal factors and external factors
(Kanyarusoke, 2020).

Throughout the year’s individuals have expanded the approach with factors like demographics,
intercultural, ethical, as well as ecological which resulting within the variants like SLEPIT,
STEEPLED, and DESTEP. Following discussion will stick particularly to PESTLE since it lead
to encompass the relevant elements within the business. Every element will be explained on
below discussion. This kind of analysis is effective within the whole industries at strategic level,
departmental level, and project level to evaluate the future markets and present markets. This is
utilized as the important input in relation to planning, marketing, business development, product
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development, organizational change, reports of research, and project management. There will be
many failure of new venture if not follow the any below point appropriately.

Political factors
Political environment of South Africa is clouded through corruption, mismanagement, famous
protest, political intolerance, and violence. These kinds of challenges slow down development at
economic level and progress as well. Gaining the support and appropriate confidence to public
and investors within the light of political issues becomes the significant jobs of South Africa
President. This nation has seen the many information technology related approaches. These have
been delayed and fully applied. As a start-up business as an IT organization will need to apply
the many ICT related strategies as government of South Africa is working on digital
development. Following points will remain effective to start-up business such as Platina Limited.
Political factors will have the direct and indirect impact on business. Impacts of political factors
will be seen through Platina Limited as the new start-up business in South Africa which work as
the IT company.

 Policy makings

Policy makers in relation to Platina Limited will remain within the all likelihood to easily
intervene within the business surroundings. In today’s time commercial restrictions as well as
political level stability are important and additionally integral elements which will determine
level of success and failure of Platina Limited in South Africa.

 Taxation

Policy of taxation will influence the running business cost for Platina Limited in South Africa.
Improvement within taxation of organization will have the similar effect as expansion within the
expenditures. Platina Limited can pass the portion of this improvement on to shoppers within the
expensive rates yet at main level it will lead to influence the organizational bottom line.

 Government supports

Government of South Africa supports the organizations within the two ways. These are monetary
support and regulatory. Platina Limited can utilize the assistance from government and gain the
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grant for the objective of growing the organization, exporting, advancement, innovative work,
etc. The company will be influenced through the modification in government laws and
regulations (Rahmoun, and Zhao, 2020).

 Political stability

Lack of political level stability within the nation influences the tasks of organization. Political
stability is especially important for organizations to work at global level. Buying the political
risk insurance will remain effective way for Platina Limited to oversee the any kind of political
hazard. In future company will have the worldwide activities as such insurance lessen the level
of risk presentation. Effective soundness of political approach can lead to influence the
attractiveness level of particular nearby market for Platina Limited.

Economic factors
Economic elements are determinants of particular economy’s performance. These kinds of
factors may have the direct and indirect long time impact on organization since it influence the
customers buying power and could easily and possibly change the models within the economy.
This leads to influence the way organizations price their services or product. Economic factors
are recognized as one of the most significant factor in PESTLE analysis. This can influence the
Platina Limited within the many ways. Platina Limited will works to building the economics of
scale. Organization will focus to maintain the costs of business and control the final product
price which support to fight with economic level instability (Pestle, and Colvard, 2012). Platina
Limited will work to build the sustainably managed employees which influence the positively
practices despite high level of practice.

 GDP

Economic constituents have the evident impact on level of profitability as well as overall appeal
of Platina limited as the new startup company in South Africa. GDP per capita in today’s time is
important economic element; GDP per capita provides the fractional perspective in relation to
the economic factors which may influence the Platina Limited. High GDP leads to high
disposable income and high level of sales for Platina Limited.

 Inflation
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High level of inflation in case of South Africa will disintegrate the buying power of customers
and shoppers. High inflation will also lead to harm the material costs and many other inputs
which will be utilized through the Platina limited.

 Interest rates

Fluctuations within the rates of interest may lead to translate into high costs or low costs for sale
and purchase of product and administration which will be powered through the Platina Limited
in South Africa.

 Rate of unemployment

High rate of unemployment is not advisable as it dissolves the customer’s dispensable income
level and will harm the Platina Limited. High rate of unemployment will lead to lower the level
of sales in relation to Platina Limited and influence the level of its profitability as well as
revenues.

Social factors
Dimension of environment presents the demographic traits, norms, customs, as well as values of
population in which business operates (Okafor, and Goon, 2020). Social factors are particularly
important for marketers in relation to targeting the particular customers. This also explains
something regarding the local level employees and willingness level to work within the
particular situations. Social factors influences will stem from macro environment social
component. Within the PESTLE analysis social factors will lead to have the impact on Platina
Limited within the many ways.

 Social patterns and behavior of customer

Social patterns lead to influence the trends of work as well as patterns which are linked directly
to customer’s behavior. These will have the direct level of impact on tastes of buyer and
inclinations and particular structure of interest in relation to produce of Platina Limited. Regular
observation of social patterns will influence the Platina Limited to reposition the products or
administrations at effective level to meet regularly changing requirements of customers.

 Social trends within the education

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Social trends in relation to high level of education will enable the Platina Limited to have
appropriate level of access to easily pool the high skilled candidate but at the similar time also
face the criticising base of customer. High level of education has enabled the customers to
become more aware about the many different products like Platina Limited. Customers are more
aware about the availability of many different substitute products and more readily available at
the many touchpoints.

 Social patterns

Organizations such as Platina Limited should focus to become customer centric in place of
product centric within South Africa. In today’s time market segmentation and customer grouping
are moving dynamically to psychographics measures as well as lifestyles for understand more
about the customers. There will be focus to use the customer oriented and customer based
marketing to appeal and influence customers emotionally. Organization will focus to make the
products enough accessible at many touch points very common to target the socially customers.

Technological factors
These kinds of factors particularly pertain to inventions within the technology which may
influence the industrial operations as well as market. It refers to technical incentives, innovation,
automating, R&D activity, and technical awareness which a market possesses (Naicker, and
Thopil, 2019). All these kinds of factors may lead to influence the decisions to enter and not
enter the particular industries to launch and not launch the particular product or outsource the
activities at abroad. Through identifying what is regularly going on technically, Platina Limited
may become enough capable to prevent from regularly spending the huge amount on developing
the technique which would become obsolete because of the disruptive technical changes.
Technical elements can influence the Platina Limited within the many ways which will be
explained within the following discussion.

 Innovation

Quick pace of technical change at Platina Limited may be driven by innovation. Leadership of
business at Platina Limited should try to push limits level of current limitations. Growth of
internet as well as online business has cast-off the intermediaries. Platina Limited will
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communicate and directly retail to customers by modern intermediaries. The start-up IT business
in South Africa will utilize the present social networks to easily retail and utilize the e-commerce
to easily boost level of sales.

 Social media and growth of business

Platina Limited will utilize the social media to interact as well as reach the customers. This can
be utilized to reach the target market and influence them effectively. It will remain cost-effective
and influential at strategic level. There is high level of competition in South African IT industry
so Platina Limited will focus to build the competitive benefit by many different ways. Platina
Limited will incorporate the less expensive production, enhanced access to customers, improve
marketing practices, improve the quality of product, and improve the business level intelligence
than competition.

 Management of technology with innovation

For flourish the competitive business world which is quick paced as well as receptive to
inventive change, Platina Limited should stay cautious. Platina Limited will remain updated on
the technical development in business and industry. Platina Limited will focus to probably go
and influence the future attractiveness and level of profitability.

Legal factors
Legal level components can influence the Platina Limited and can likewise influence the
instruments by that a business purchases the stock and links with client. Platina Limited should
focus to remain mindful and follow the legal elements.

 Labor law

Law of labor refers to guidelines within the regulations which set up the minimum as well as
conditions of benchmark (Loftus, and Sealy, 2012). All these involve identifying the individuals
work. Laws of labor involve the elements of minimum operational age least time that based
compensation, and many more. Platina Limited should remain mindful of laws within the routine
business tasks.

 Discrimination law
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Within the discrimination law Platina Limited should ensure and avoid the episodes of unequal
action. Overall to run the operations of Platina Limited within the IT industry of South Africa
should focus to provide the regular level of opportunities in relation to training for achieve the
new heights within the competitive business environment.

Environmental factors
In relation to Platina limited environmental elements may involves the following.

 Environmental stability

Platina Limited may be anticipated to incorporate and maintain the standard into the business
methods and to support the choices of resource allocation. Platina Limited should work with
environmental laws that will influence guide and influence the operations to become
environmentally friendly. Leadership in Platina Limited should measure the connection between
natural actions as well as budgetary execution. The company in case of South Africa should
focus to strategically select and evaluate the practice of business through anticipating the impact
of natural activities and social initiatives.

 Environmental sustainability as well as improved relations of customers

Customers will be inclined to the utilization of environmentally sustainable services and products
(Miller, Goldberg, and Berna, 2013). Environmental sustainability within the operations works to
improve the bottom line as well as overall profitability in relation to business of Platina Limited.

Reasons of new ventures failures and arguments

Because of the limited resources, high uncertainty as well as inexperienced management and
employees, new ventures leads to suffer from the high mortality rate. Following discussion will
explain the reasons of new ventures failures.

Lack of management experience

One of the main challenges faced through the new ventures is that management group is
particularly new in relation to the role. (Yang, and Aldrich, 2012) have argued that top
management in new venture has no kind of prior record of being within the charge of whole
organization fortunes. For example, when management has specific people that have led the
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organization within the past time, they are now faced with the new condition in which
organization itself has no kind of previous track record. This is different type of condition.

Poor level of financial management

Operational challenges keep the entrepreneur regularly busy and as the result, financial level
management is likely to get mistreated. (Aldrich, and Yang, (2014) have argued that ventures
may find many technicalities in relation to accounting as well as finance intimidating and avoid
looking into it. For example errors within the financial level management can be very bad
management of receivables, unproductive investment and poor decisions of budgeting.

Conclusion
In the limelight of the discussion it can be concluded that PESTLE analysis play the important
role to identify the external elements which could influence the market as well as evaluate how
they could influence directly an organization. This will remain effective in case of new IT start-
up business like Platina Limited to use the PESTLE analysis for resolve the challenges and run
the operations of business smoothly. This discussion has also covered the reasons of new
ventures failures with arguments to develop the effective level of understanding in relation to
practices of business.
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References
Aldrich, H.E. and Yang, T., 2014. How do entrepreneurs know what to do? Learning and
organizing in new ventures. Journal of Evolutionary Economics, 24(1), pp.59-82.

Kanyarusoke, K., 2020. Problems of engineering entrepreneurship in Africa: A design

optimization example in solar thermal engineering. Engineering Science and Technology, an
International Journal, 23(2), pp.345-356.

Loftus, E. and Sealy, J., 2012. Interpreting stable carbon isotopes in human tooth enamel: An
examination of tissue spacings from South Africa. American Journal of Physical
Anthropology, 147(3), pp.499-507.

Miller, C.E., Goldberg, P. and Berna, F., 2013. Geoarchaeological investigations at diepkloof
rock shelter, western Cape, South Africa. Journal of Archaeological Science, 40(9), pp.3432-
3452.

Naicker, P. and Thopil, G.A., 2019. A framework for sustainable utility scale renewable energy
selection in South Africa. Journal of Cleaner Production, 224, pp.637-650.

Okafor, U.B. and Goon, D.T., 2020. Developing a physical activity intervention strategy for
pregnant women in Buffalo City Municipality, South Africa: A study protocol. International
Journal of Environmental Research and Public Health, 17(18), p.6694.

Pestle, W.J. and Colvard, M., 2012. Bone collagen preservation in the tropics: a case study from
ancient Puerto Rico. Journal of Archaeological Science, 39(7), pp.2079-2090.

Yang, T. and Aldrich, H.E., 2012. Out of sight but not out of mind: Why failure to account for
left truncation biases research on failure rates. Journal of Business Venturing, 27(4), pp.477-492.