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DPW is a very victorious home furniture company operating in P Country. It has a good reputation for being customer focused and giving value for money through its effective operations. Following a systematic analysis of its home/domestic market, it is apparent that the market is reaching maturity and to attain further growth and expansion will contain moving into markets abroad. It has identified F Country as a possible target for its first step into internationalisation.
The company now wants to undertake formal analysis to help it to better understand the external environment of F Country.
Explain ONE strategic management model/framework and explain how it could be used tohelp DPW to understand the external environment of F Country.
There are a number of strategic management frameworks that could be used to assess the external environment in F Country to choose whether to move into F Country. These include PEST, Porter's five forces, and Porter's Diamond. This answer will explain PEST.
The PEST framework is a useful way of organising information on the macro-environmental influences that can be used to assess the external factors that may impact on DPW's development in F country. This would involve an analysis of the political/legal, economic, socio-cultural and technological factors. The headings can be used as a checklist to assess the relative importance of the different influences on DPW Company's proposed strategy.
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