Why is it best for large organizations like Dish to use both PEST and Porter's 5 Forces analysis in helping its leaders to understand their particular external environment? Make sure you demonstrate understanding of both analytical processes in your discussion and give clear, Dish-related examples to support your arguments.
Second, describe how the information obtained from the organization's macro-level external analysis might be used by an organization like Dish in performing their SWOT analysis.
In short, what should an organization like Dish be doing to analyze the external environment at the macro-level and how does that overlap with the organization's micro-level analysis efforts? Make sure you provide well-reasoned and well supported arguments.
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PEST and Porter's 5 Forces each analyze different aspects of a business. PEST (Political, Economic, Socio-cultural and Technical) factors are often considered to gauge the expected impact of business decisions, and the likelihood that the trend set will continue in a particular direction. PEST analysis allows a company to determine if the resources and capabilities used by the company support the company's opportunities, or diminish existing threats, as well as the level at which the resources and capabilities match the company's goals. (MindTools). Dish, with its ability to supply images right into customers' homes, is in a position to spread political viewpoints, news about the economy, and socially-acceptable programs. The company may wish to offer programs geared towards the Hispanic population, which is a fast-growing ethnic group in the United States; PEST analysis allows the company to determine if the resources and technical skill sets available will help the company to achieve this goal.
Managers at Dish can use a combination of both PEST and Porter's Five Forces to analyze the business strategy because each approach has a different contribution.
While PEST focuses on the use of the company's resources and capabilities, Porter's Five Forces form part of the economic foundation for business strategy. Managers can use Porter's Five Forces to help them to understand why certain industries are inherently more profitable than others, as well as why certain companies are more profitable than others. Porter's Five Forces shape a consistent foundation that helps managers to understand the logical relationship between the choices companies make, and the profits they glean. (Allio, 2012).
Porter's Five Forces Model for Dish are as follows:
• Threat of Substitute Products--Dish has a high threat of substitute products in the market since there are numerous competitors in the cable network and satellite carrier industry, such as DirecTV and Comcast Corporation. In addition, competitors such as Netflix and Hulu offer video streaming in customers' homes.
• Threat of New ...
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