Macro Environment Analysis: NSK Furniture

Introduction

NSK Furniture is a furniture company that specializes in mid-range furniture. Following the dismissal of the previous General Manager at the Asia Pacific branch in Singapore, the new General Manager has to take charge, re-evaluate and re-establish the instillation of the company’s modern day management practices that was not accomplished by the previous General Manager. As time moves fast and ever so changing, so does the standards, demands and competitiveness of the furniture industry that this company is in. The new general manager has to step up the game and produce a report on how to manage the company well and establish it further. Planning

The general manager intends to start off with the 4 key elements to a plan. As the

The PESTLE framework is a tool used in the macro environment analysis to establish a strategy that will help the furniture company to its advantage.

The PESTLE is made up of political factors, economic factors, social factors, technological environment and legal aspects of the industry.

1) Political factors

Political factors are about the governments’ involvement level, inclusive of stability or instability of its government, regulations that restrict business internationally, trade tariff, social welfare, corporate profits and tax policies.

Currently, the company needs to be of a stronger brand so as to be able to easily gather information or materials from the factories in India and Vietnam. 2) Economic Factors

Economic factors are the financial state of which a country is in. It affects how a company profits and how their business is being done. Currently the exchange and interest rates of India and Vietnam are on a low so it is wise to invest in them more in terms of manpower, technology and supplies so as to lessen the cost spent by the company. With these rates being low, the disposable income of the consumer is on a low in those countries as well thus, it will affect the company’s business there. The solution is as such that once the product is being produced there, they will be shipped

Ikea on the other hand is a fierce competitor as it has already established brand equity in households especially to mid range consumers.

Organizing

Decentralizing the company’s management so that authority is being spread to the lower levels in the organization is what the general manger aims to do. Making the structure of the company flat rather than tall will give the employees more focus and autonomy, making decisions freely.

To do so, divisional approach is applied to the company. With this, the company can provide services and produce products to different markets, internationally, domestic or regional.

Departmentalizing into functional, divisional or matrix is the process of grouping people which will be applied by the manager.

Leading

Previously, the dominant general manager did not lead the company well as there were conflicts among the team with results to forcing workloads with restricted time on the employees. The expectations were always too far from reality. Also, there was not a balance of work and relationship between the previous general manager and employees thus, making motivation and commitment a challenge for