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7 views8 pages

Business Studies

Uploaded by

jesal.madaliya
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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1.

Political Factors
Changing tax legislation, consumer protection and employment regulations, and
insurance mandates are all elements in the political sphere that could have an impact
on healthcare.

For example, a change in tax policies may call for a strategy adjustment that either
takes advantage of increased government spending for healthcare or makes allowances
for reduced government subsidies. Or, changes in employment law, like the 2016
legislation that impacted employee overtime requirements, could mean major
adjustments in staffing and overtime needs.

2. Economic Factors
Unemployment, inflation, and interest rates are examples of economic issues that both
directly and indirectly influence the financial performance of healthcare organizations.
These changing conditions can have an impact on public spending policies and your
purchasing power.

For example, if you manufacture healthcare equipment, a high rate of unemployment


will mean fewer people can purchase your products. Or, more people losing jobs means
a greater loss of health insurance coverage, which will affect the types of health
services people seek out.

3. Sociocultural Factors
A PESTEL analysis for healthcare should also identify changes in demographics,
values, and beliefs of your various consumer groups. A hospital, for example, should be
knowledgeable about the community it serves to avoid violating widespread values or
norms.
Factors like these should also play into your organization’s marketing strategy. Using
content that shows you’re aligned with a specific sociocultural set of beliefs/values will
boost the effectiveness of your marketing and impact your performance.

4. Technological Factors
Technological advancements specific to hospitals and healthcare manufacturers could
have a varying range of effects on your overall performance. The equipment being
manufactured and used is continually changing, as is the development of new
treatments. And new technology outside the healthcare field could also affect how an
organization communicates with its consumers, as in app development or digital
marketing.

Planning to take advantage of those advancements could mean good growth


opportunities.

5. Environmental Factors
Environmental sustainability practices have both environmental and financial benefits
for healthcare organizations. Many hospitals are now seeking LEED certification for
environmentally-friendly building design; waste disposal programs are also coming
under scrutiny.

Leadership in the areas of green environment practices also illustrates corporate social
responsibility (CSR)—which should be a key part of any strategic plan.

6. Legal Factors
Failure to follow new laws and legal procedures that govern healthcare could lead to
immediate failure of your strategy. The legal implications of pending lawsuits, HIPAA
compliance, potential hospital mergers, and more should all be taken into consideration
as part of your overall strategy.

5 Benefits Of A PESTEL Analysis For


Healthcare Organizations
1. Understanding the impact of external factors: The COVID-19 pandemic
highlighted how external events can drastically affect healthcare operations. A
PESTEL analysis provides your organization with a structured way to assess
these external influences, helping you understand how they can affect your
operations and planning.
2. Comprehensive strategy planning: A PESTEL analysis extends your strategic
planning beyond the internal focus on your facility and competitors. It
incorporates an examination of political, economic, social, and technological
factors, offering a holistic view of the environment in which you operate.
3. Proactive problem-solving: Identifying potential external challenges through a
PESTEL analysis enables your organization to take preemptive actions. For
example, if you’re aware of looming supply chain issues, you can take steps to
modernize your inventory system to maintain more appropriate stock volumes
and improve inventory forecasting. Then you’ll be ahead of the curve, rather than
retroactively scrambling to manage the problem once it occurs.
4. Enhanced profitability through external awareness: By recognizing and
responding to external factors, such as emerging legislation or workforce trends,
your organization can enhance its profitability and operational efficiency. This
proactive stance helps in navigating the healthcare landscape more effectively.
5. Alignment with community health needs: A PESTEL analysis encourages
your organization to look beyond its walls and understand the health trends
within your community and the broader region. This knowledge ensures that your
services are aligned with the current and evolving needs of the population you
serve, aiding in informed decision-making for future strategic directions.

Strength
● Consistent Highest Return Stocks over Five Years - Nifty500
● Company with Low Debt

● Increasing Revenue every Quarter for the past 4 Quarters

● FII / FPI or Institutions increasing their shareholding

Weakness
● Promoter holding decreased by more than -2% QoQ

● Negative profit growth, promoters decreasing shareholding QoQ

● Low durability companies

● Inefficient use of capital to generate profits - RoCE declining in the last 2 years

● Inefficient use of shareholder funds - ROE declining in the last 2 years

● Inefficient use of assets to generate profits - ROA declining in the last 2 years

● Poor cash generated from core business - Declining Cash Flow from Operations for last

2 years

● Declining profits every quarter for the past 3 quarters

● Low Piotroski Score : Companies with weak financials

● Annual net profit declining for last 2 years

● High promoter stock pledges

● Stocks Underperforming their Industry Price Change in the Quarter

Opportunity
● PEG lower than Industry PEG

● High Momentum Scores (Technical Scores greater than 50)

● Stock with Low PE (PE < = 10)

Threats

● Promoter decreasing their shareholding

● Companies with growing costs YoY for long term projects

● Risky Value (DVM)

● RSI indicating price weakness

● Top Losers

● Declining profitability: Falling ROCE

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