4.6 Pestel Analysis
Pestel analyses is a strategic analytical technique used by organisations to better understand the external environmental factors impact on the company. It is also known as a macro environmental framework. Figure 4.6 shows a PESTEL model.
Figure 4.6. All the external environmental factors (PESTEL factors), (2018: Online)
Below is a breakdown of the Bidvest PESTEL.
4.6.1 Political Factors
It is said that the reason Aspen Pharmacare is the leading pharmaceutical manufacturer because they have better political connection as opposed to Adcock’s management. Bidvest on the other hand already have some foothold with selling to the state. The Government Employees Pension Fund and the Public Investment Corporation (PIC) are the two biggest investors and they own about 30% of Bidvest together. The PIC is also Adcock’s single largest shareholder with 14.4%. Bidvest acquiring Adcock will greatly increase their chances of working with the state
4.6.2 Economic Factors
With Bidvest heavy dependence on South African market and the state of the economic growth at its worst state is a huge risk on revenue of the organisation.
4.6.3 Social Factors
The current cultural and demographic aspect in South African (where Bidvest have a big market share) will prove to be a stumble block for the organisation however they have been doing well bearing in mind that the group have a succession and talent management ideology which has resulted in 68% of management posts being filled by the previous disadvantaged black race. As of 2018 7 485 leaners have benefited from this programme.
4.6.4 Technological Factors
With the forth industrial world (Industry 4.0) looming at the door, all organisations including Bidvest will have to re-look at the way they have been conducting business. This world will force changes to the norm. Only organisations that are adaptive to change will survive.
4.6.5 Legal Factors
Since Bidvest have a larger footprint in South Africa, the business might be affected by the recent changes to employment law. In 2019 the will be a minimum wage law implemented. This and other laws like the consumer law that from time to time change is bound to negatively affect this organisation
4.6.6 Environmental Factors
With Bidvest quest to acquire 60% of Adcock, they will automatically have to consider the ecological aspect of the medicine producers. They will need to work in partnership all the suppliers, customers and other relevant business partners, within its sphere of influence, to redesign and reduce the environmental impact of products, services and other business activities. Optimize consumption of raw materials and energy, and minimize waste through applying a ‘reduce, reuse, recycle’ philosophy.