Pros & Cons of Macro Environment (PEST Factors) On New Product
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OL 3, NO 2 INTERDISCIPLINARY JOURNAL OF CONTEMPORARY R ESEARCH ESEARCH IN BUSINESS V OL Pros & Cons of Macro Environment (PEST Factors) on New Product Development in Fast Food Industry of Pakistan for Sustainable Competitive Advantage
Rizwan Ahmad Ch. MS Scholar , Riphah Int. University, Islamabad, Pakistan Jamshed Khattak Ph.D Scholar , Muhammad Ali Jinnah University, Islamabad, Pakistan Muhammad Nizam Khan & Nabeel Abbas Khan MS Scholars , Riphah Int. University, Islamabad, Pakistan
Abstract Fast Food is now becoming the most favorite food around the world due to trend shifting; quick home delivery and people are kept busy in their extensive work. Many companies trying to maximize their market & profit share after launching new product in the era of competition, therefore scanning of market environment now centre of focus to get completive advantage via new product development. Despite the facts, the rationale right behind for investigate the Impact of Macro Environment on New Product Development of Fast Foods Companies (FFC’s) is to uncover the level of macro environment Scanning by FFC’s operating in Pakistan. The Renewal Associates (2003) PEST sheet used & descriptive statistics analysis were used to estimate the intensity of Macro Environment on New Product Development. The result shows that FFC’s were not scan Macro Environment too much & consider different factors of Macro Environment for new product development. Key Words: Macro Environment, PEST Factors, New Product Development, Sustainable Competitive Advantage, Strategic Marketing, Strategic Management, Sargodha Pakistan.
INTRODUCTION: As per Bender and Bender (1995), Fast foods are broad term used for a restricted menu of foods that lend themselves to production-line techniques; suppliers tend to specialize in products such as hamburgers, pizzas, chicken, or sandwiches”. (2001) undoubtedly demonstrated the production-line approach with specic Smith allusionet toal.sandwich production. The fast food industry in World has grown significantly during the last decade and now fast food outlets providing a diverse range of food products according to consumer’s choices. As Fieldhouse. (1996), found that the steep size of the fast food enterprises assured that it has a substantial inuence in contemporarily world on the eating habits of big segments of the population. At present in contemporary world a novel consumer standard of living has emerged about dining of fast food due to the global village, trend shifting & busy life of people. The stipulate for fast food has been mounting radically across the globe. globe. Jennifer L. Harris et. all. (2010), and the trend of fast food is also on the rise in Pakistan from last decade. Therefore need for the new Product development greater than before to get sustainable competitive advantage. Product Development needs to scan Business Environment, which comprising of Internal & External Environment, Further External environment divided into Micro & Macro Environment (Vignali, C., Vrontis, Vrontis, D, 2003). Macro Environment always plays a vital role in New Product Development as per Vrontis, D., Kogetsidis, H., Stavrou, A. (2006). In this context, to find the impact of Political, Economical, Socio-Cultural and Technological COPY R IGHT IGHT © 2011 Institute of Interdisciplinary Business Research
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Factors on marketing activities of Fast Food Industry in Pakistan, the research has been carried out. In rejoinder to a cutthroat business environment, NPD has been playing a vital role in the accomplishment of many Organizations (McCarthy, Tsinopoulos, Allen, & Rose-Anderssen, 2006). The aim of this research is to find the impact of PEST Factors on New Product Development in Fast Food industry. PEST is a word comprising of four External Factors, i.e. Political, Economic, Socio-cultural & Technology (Goodnow, J.D. and Hansz, J.E. 1972), New product development (NPD) is an inter-linked sequence of information dispensation tasks, where final product design translated from knowledge of customer needs & wants (Meybodi, 2003). Clark and Wheelwright (1995) mentioned, it is one of the most influential, but tricky activities in business. Today’s Business managers and marketing academics identical that new product development is an essential building block of an organization’s enduring survival is success (Henry et al., 1989). These studies have proved that Scanning of Environment is crucial to determine the success of new product development process. Additionally, it is broadly recognized that strategic orientation is imperative as one of determinant to boost company performance. Several studies strenuous on the features finding the success and failure of a new product, therefore scanning of environment needed (Cooper, 1979; Maidique and Zirger, 1984; Song and Parry, 1997). While Kwaku and Satyendra (1998) research on the link between strategic orientation and business performance. Ramaseshan et al. (2002) also contribute towards marketing orientation and company performance. However very little study mull over strategic orientation as contributing factors in improving new product development process. Involvement of External Environment in NPD process in developing countries remains unclear. Numerous marketing activities including internal environment influences on NPD process in Fast Food industry, which is still not been investigated expansively especially in developing countries like Pakistan mainly the conduct of it insinuation in determining NPD success. Moreover, the use of Research & Development is recognized as one of imperative department that must be institute within organization to make sure the innovation continuity. As Kohli and Jaworski (1990) has talk about on the importance of market scanning / information in business decision processes. Accordingly, the role of market scanning activities is supporting the success of NPD process among Pakistani Fast Food companies, but it is still unclear and need to be investigated. Almost, no research work has been carried out regarding PEST analysis inpaper Fast Food of Pakistan. Thus, this aims industry to investigate the impact of PEST on new product development among Fast Food Companies in Pakistan. The paper also considers the relationships between New Product Development and Sustainable Competitive Advantage.
LITERATURE REVIEW Due to intense competition in Fast Food Industry, Companies now paying special attention towards New Product Development to attracts more customers & maintain market share. Therefore, now for sustainable competitive advantage not only New Product development needed, but also importance of formulation of strategies for New Product Development considered necessary. New Product Development (NPD) process starts with the situation analysis, where Company carefully exposed the Micro & Macro Environment for new opportunities for NPD. Literature has a lot to say about this subject but few major research results are being passage here. As per Kotler and Armstrong (2005), A new product is a good, service, or idea that is professed by potential customers as new. New product product can be passing on as original products, COPY R IGHT IGHT © 2011 Institute of Interdisciplinary Business Research
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product modifications, some improvements in product and totally new brands that the firm builds up all the way through its own research and development & marketing effort. New products and services may be categorized categorized according to (1) n newness ewness to the targeted market and (2) in respect of level of customer value created, resultant in the subsequent types of new products as per David and Nigel (2001). They further illustrated three types of new products that are;• Transformatio Transformational nal Innovation: those products that are totally new and the value created are significant. • Substantial Innovation: Those products that are significantly new and also may create imperative value for customers. • Incremental Innovations: Innovations: Those improved products, which create higher performance or better perceived value may at lower cost as comparing to previous previous ones. An example is a new Coca-Cola flavor. Booz, Allen and Hamilton (1982) in their research study of new product introduction success according to the degree of newness in target market & for firm too, mentioned 6 types of new products (division according according to parentage) expre expresses sses in table. S. #
Product Category Category
1
Cost reduction products
Product circumstances circumstances
New products with existing performance at lower cost Existing products introduction to new market segments (Market Development) Commercialization of existing products after major or minor improvements
% out of 100
7% 11%
2
Repositioned products
3
Modified products
4
Additions to product lines
New entry into existing product product lines of the firm
26%
5
New product lines
Totally new products for the firm may not for existing markets
20%
6
Radical products
Products that are totally new to the market
10%
26%
A. The Rela Relation tionship ship between between PEST PEST & New Product Developme Development nt Copper (1979) suggested that for successive new product, market knowledge and marketing proficiency play the critical role. He further added that those projects projects which based on marketoriented activities including market assessment, market studies & test market etc, were undertake proficiently. Cooper and Kleinschmidt (1987) narrated that collection of related market information firstly including evaluation of internal & external environment will outcome in form of success of new product development, if they also plan development strategies of these new products that match firm goals. Actuality, most new product development teams used market information for development and design process of these products in form of survey for market trends, focus group testing etc (Ramaseshan et al., 2002). So, these studies means that firms should gather as much market information in form of input to better know the market / customers needs and wants for better output in shape of new products. Therefore, it is worth mentioning that market research activities influence new product development & its allied processes. Environmental factors affect the independent variables; few studies have shown different
views on different circumstance (Smith and Grimm, 1987 and Azaze et al., 2005). While study by Smith and Grimm (1987) focused that how environment changed & impact on strategic shift and firm performance. They concluded that there is important relationship between environmental variation and strategies of firms, so majority firms change their COPY R IGHT IGHT © 2011 Institute of Interdisciplinary Business Research
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strategies according to the environment & those which failed to do so outperform. Azaze et al., (2005) comprised in his study that some environmental factors have moderate affect between product and promotion adaptation, delivery chain strategy, and new product design strategy and on target market. Situation Analysis [Environmental [Environmental Scanning] Situation analysis is the key to find the strategic fit in between environment & company goals
& also first and important stage in marketing planning, because effective strategies can’t be formulated & implemented without examining the environment in which the firm operates (Vignali et al., 2003, p. 15). Vignali and Vrontis (2004) suggested that for strategic formulation, environmental scanning including external and internal environments is essential. Important factors that should be analyzed in an internal and external inspection are mentioned in Figure 1 & 2.
External analysis The external environment is comprise of macro-environment and the micro-environment, which are basically forces over which a firm has almost no control, if any, then it’s very limited. The micro-environment is the stake holders of the firms on which they have control including supplier, customers, retailers and competitors, while the macro-environment consists of forces including political, economic, social and technological (PEST) (Vignali et al., 2003). The environment for companies operating in the Fast Food industry is constantly changing. Therefore, it becomes critically important to identify opportunities and threats when formulating strategy for the purpose of gaining competitive advantage. Macro-Environment Macro-Environme nt (PEST)
PEST includes all factors that can influence an organization in, but firm has not direct control on these factors. Generally, a firm does not influence by any laws. Macro Environment is oftenly changing and company cope this through flexible approach. The wider environment is COPY R IGHT IGHT © 2011 Institute of Interdisciplinary Business Research
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also continuously changing and the firm needs to compensate for changes in Socio-culture, economics politics, and technology. (Goodnow, J.D. and Hansz, J.E., 1972) Some important factors listed below as per Renewal Associates (2003) recommended for scanning of PEST. Political Economic 1. ecological/environmental issues 1. ho home me eco econo nomy my situ situat atio ion n 2. ho home me ec econ onom omy y tre trend ndss 2. current legislation home market 3. 4. 5. 6. 7. 8. 9.
future legislation regulatory bodies and processes government policies government term and change trading policies funding, grants and initiatives home market lobbying/pressure groups
Social 1. li life fest styl ylee trend trendss 2. demo demogr grap aphi hics cs 3. consum consumer er attitu attitudes des and and op opini inions ons 4. med edia ia vi view ewss 5. law chan changes ges affe affecti cting ng socia sociall fac factor torss 6. brand, brand, compa company, ny, ttech echno nolog logy y image image 7. consum consumer er buying buying patter patterns ns 8. fash fashio ion n and and role role m mod odel elss 9. major major events events and inf influe luence ncess 10. buying buying access and trends trends 11. ethnic/reli ethnic/religious gious factors 12. advertising advertising and publicity publicity
3. overse overseas as eecon conom omies ies and tre trends nds 4. ge gene nera rall taxat taxatio ion n issue issuess 5. taxati taxation on specifi specificc to product/ product/ser servic vices es 6. season seasonali ality/ ty/wea weathe therr issues issues 7. mark market et and and tra trade de cyc cycle less 8. specif specific ic indust industry ry factor factorss 9. market market route routess and distri distribut bution ion trend trendss 10. customer/en customer/end-user d-user drivers 11. interest interest and excha exchange nge rates Technological 1. compet competing ing techno technolog logy y develop developmen mentt 2. re rese sear arch ch fu fund ndin ing g 3. associa associated ted/de /depen penden dentt tec techno hnolog logies ies 4. replac replaceme ement nt techno technolog logy/s y/solu olutio tions ns 5. matu maturi rity ty of tec techn hnol olog ogy y 6. manufa manufactu cturin ring g maturit maturity y and cap capaci acity ty 7. inf inform ormati ation on and and commun communica icatio tions ns 8. cons consum umer er buy buyin ing g mechanisms/technology 9. te tech chno nolo logy gy legisl legislat atio ion n 10. innovation innovation potential potential 11. technology access, licensing, licensing, patents 12. Intellectua Intellectuall property issues
B. The Relationship between New Product Development & Sustainable Competitive Advantage New products are vital to the survival in competitive market and also important for long-term growth of any firm. To get successive in new product development Firm have to pay attention that how they redirect their organization’s goals towards their product target market (Ramaseshan et al., 2002), Yew (2002) suggested that a firm should develop and sustain competitive advantage, if they want to archive superior business performance. He further added that business environment analysis is vital for the success of the NPD and thus this could help firms to achieve higher performance for the new product development including overall business performance, Customer Satisfaction and then it will lead to competitive advantage. Due to culture, demographics, geographic of a region, religion, and or any other attributes, there is almost no consensus in the literature regarding PEST factors affect uniformly on firms among researchers. It can be vary form one region to another. However, Renewal Associates (2003) urbanized PEST factor sheet/ instrument to find out the degree of the dimensions of PEST, It consists of more than 40 items that are coupled into four different dimensions namely 1-Political, 2-Economical, 3-Socio-Cultural; and 4-Technolical. This instrument is based on the differences between the perceptions and expectations of Marketing Manager regarding the dimensions of PEST. The difference between the COPY R IGHT IGHT © 2011 Institute of Interdisciplinary Business Research
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perceptions and expectations indicates the existence of a gap. The instrument has been adapted depending on the industry in which the research has been conducted. The model in this study mentioned below to find the affect of Macro Environment (PEST Factors) on New Product Development. How fast Food Companies using PEST Factors sheet to scan the environment for New Product Development & how PEST factors guides the companies for that product, which is as per requirement of Customers. Second, this study also focuses to analyze the link behind the Sustainable Completive Advantage via New Product Development. Are Companies being paid in form sustainable Competitive Advantage, If companies doing PEST analysis for New Product Development in Pakistan?
Macro Environment (PEST Analysis)
Political Factors
N.P.D Economical Factors
Sustainabl e Competitiv e
Socio-Cultural Factors
Technological Factors
METHODOLOGY The purpose behind this study is to investigate the link in between Macro Environment (PEST Factors) & New Product Development for Sustainable Competitive Advantage in Fast Food Industry of Pakistan. All Fast Food industry Pakistan is the population of this study. A sample of 7 Fast Food Companies is selected through online sample size calculator including 03 International (Named Co. A, B & C) & 04-National (Named Co. W, X, Y & Z), while having confidence level is 99% (SurveySystem.com 13-05-2011 1100AM). A convenience sampling, which is also known non-probability sampling design method, was used because of its consideration as more appropriate to collect the Data. In convenience sampling customer accessibility, data collection is easy as compare to other methods, required less time and in addition data can be gather from the respondent of the sample that are near to the researcher. As Food and Nutrition Technical Assistance Project (FANTA 1997) narrated that non-probability samples are uncomplicated and inexpensive than others probability sample’s. To collect the the required information from Fast Food Companies operated in Pakistan, A-personal contact approach’ is also used; so more the researcher illuminates the queries of respondent raised by if any. A survey is a way to gather information regarding particular population as sampling some of its members through a specific way, usually a structure of standardized questions. Surveys can be conducted by different ways including mail to the respondent, telephone, Internet or even through personal interview, which can be manage either to individuals or groups as a unit. The basic purpose of a survey is to elicit data which, after evaluation/process, results in COPY R IGHT IGHT © 2011 Institute of Interdisciplinary Business Research
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a profile or statistical characterization of the specific population sampled. Questions might be related to particular behaviors, activities, beliefs, attitudes, opinion, and/or attribute of those who are being surveyed. The methodology used for Survey is Questionnaire. Questionnaires structure included closed ended Question to draw out the relevant information, which required a set of option used for collecting of required information. The Questionnaire was divided into three sections:1. Demograph Demographic ic of the Respondent Respondent included included Pos Position ition of Employe Employee, e, Experience Experience in Fast Food Food Company, Gender, and Age, while Company & Employee name are being kept confidential due to certain approval issues & privacy due to ethics. 2. The second second section section relates relates to the New Product Product Developm Development, ent, which which comprises comprises 05-close-ended questions adapted from Dr. Ray O. Waddoups R&D Improvement Diagnostic Tools (2011) as reported below;i. Do you regular regularly ly beat your your competito competitors rs to market market with new produ products? cts? Yes or No ii. What type type of new products products yo your ur com company pany de develop veloped? ed? Is it Transform Transformation ational al innovation or Substantial Innovation or Incremental Innovations? iii. How long long do you allow allow your projects projects to schedule schedule develop development ment?? If New iteration iteration of existing products or if totally new products? (Time period 06moths less to onward more than 02 years). iv. Are you scanning scanning extern external al environme environment nt (pest factors) factors) roadm roadmaps aps used for for NPD? Yes or no or Sometimes v. If yes to Q4, Q4, is NPD process process leading leading to your your company company towards towards sustainab sustainable le competitive advantage? Yes or no or Sometimes The last section dealt with the response of marketer towards PEST:-. The questionnaire designed for this part was based on the widely accepted Renewal Associates (2003) PEST Factor sheets. Some parts of questionnaire reconstructed according to need of study while focusing of cultural & economic situations of country, where Fast Food Companies operating. The questionnaire is more scientific rather straightforward. Therefore Researcher provide full assistance while data collection & explain the nature of PEST factor. Firstly, Respondent asked by Researcher that was this factor affected your company new product development process or not? If the answer of respondent was yes then further its relative Importance of Implication of that factor asked according to the Time, type, Dynamics & relative importance for the firms, which scale mentioned in Table-A adapted from Renewal Associates (2003). A total of 22 attributes were categorized under four dimensions in respect of Pakistanis culture as follows. S. # 1 2 3 4
Attributes
# of Questions
Political Economical Socio-Cultural Technological Total =
5 5 7 5 22
Statistical software used to examine the data set. Cross Tabulation used to narrate the results of demographics of the respondent. Cronbach’s alpha for instrument’ to test the reliability of questionnaire, mean and standard deviations of the attributes will also be computed.
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Table-A
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07-questionnaires were distributed among sample to collect data. All collected back & were useable for data analysis among them. Response rate is 100% because of personal contact approach. The gender-composition consist of was 6 male (85.7%) and only 1 female (14.3%) respectively. The cause behind less numbers of female’s respondent was that males are held responsible for earning in Pakistani cultural. Obbe (1980) told that Men executes the necessities or accountable for outside the home, while females tend to perform domesticduties inside the residence. As per consideration of age of Customers, 3 persons lies in age group b/w 23-28 & remaining 4 lies in b/w 29-35. While 4 are the middle level managers & 3 are line managers to whom data were gathered. 2 managers were working with company from last 3 years, 4 were from last 3 – 6 years & 1 was loyal from last more than 6 years. Cronbach’s alpha for Renewal instrument’ (22 items) was 0.807 was found to be within limits for further analysis as greater then Rule of Thumb (0.7). While company’s level of New Product Development, 5 Companies (2 International & 3 National) were regularly introduced new products, while 2 (1 International & 1 National) sometimes developed new products. As per type of New Products, 1 National Company did transformational innovation & 1 national Company did substantial innovation, while all 3 International & 2 National did incremental innovation. 1 International company allow iteration in old products project to schedule development for 6 months to 1 year period, other 2 International allow 6 months or less in case of totally new & 6 months to 1 year for iteration in existing products respectively. While National companies are focused to scheduled time on new product development as 2 companies provided 6 months or less time & 1 provided 1 to 2 years for new products development, while one company out of four focused on alteration in existing products after giving 6 months to 1 year for development of products. As per question asked regarding scanning of PEST factors for NPD, all 3 international companies did PEST analysis some times, while 2 National FFC (Fast Food Companies) doing PEST analysis regularly & 2 did some times. 1 International Company always got sustainable competitive advantage after NPD, while 2 got sometimes, on the other hand same situation was with National Companies with ration 1:3. PEST factors affects on NPD mentioned in table-B, considering Political factors, Govt. policies, Tax rates affects most than others factors, FFC’s are least concerned with Labour Laws & Trade restrictions, while tariff didn’t affected the NPD. In Economical factors Economic growth of the country, Interest rates, Exchange rates & GDP not so much bothered by FFC’s, while inflation always impact on NPD. In Socio-Cultural, FFC’s always care health-consciousness during development of products, & didn’t care about age-distribution, & also concerned with Major events, Career attitudes of peoples, Ethnic/Religious factors for development of products, but not concerned with population growth rate. During development of products, FFC’s gives more weight to rate of technology change, while also much concerned with Technological shifts, Innovation, R&D activities & least concerned with Research funding. Table-B showing mean & standard derivates of all factors.
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TABLE-B Descriptive Statistics
N
Govt. Policies Tax Impose by Govt. Labour Law Trade Restrictions Tariff Economic Growth
7 7 7 7 7 7
Interest Rates Exchange Rates Inflation Rate GDP Health-Consciousness Population Growth Rate Age Distribution Career Attitudes Consumer Buying Patterns Major Events & Influences Ethnic/Religious Factors R&D Activity Rate of Technology change Technological Shifts Innovation Research Funding Valid N (listwise)
7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7
Minimum 1.00 1.00 1.00 1.00 2.00 1.00
M Ma aximum 1.00 1.00 2.00 2.00 2.00 2.00
Mean 1.0000 1.0000 1.7143 1.8571 2.0000 1.4286
Std. Deviation .00000 .00000 .48795 .37796 .00000 .53452
2.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 2.00
2.00 2.00 1.00 2.00 1.00 2.00 1.00 2.00 2.00 2.00 2.00 2.00 1.00 2.00 2.00 2.00
2.0000 1.7143 1.0000 1.8571 1.0000 1.4286 1.0000 1.4286 1.1429 1.1429 1.1429 1.5714 1.0000 1.1429 1.2857 2.0000
.00000 .48795 .00000 .37796 .00000 .53452 .00000 .53452 .37796 .37796 .37796 .53452 .00000 .37796 .48795 .00000
CO. WISE PEST ANALYSIS ACCORDING TO TIME, TYPE, DYNAMICS & RELATIVE IMPORTANCE
Factor wise PEST analyses (Table-C) narrated below for understanding of these factors according to the time, Type, dynamics & relative importance according to the scale adapted. Numbers showing, who many companies considered that factors important for NPD, then further bifurcation that what numbers of companies gives rating according to the time, type, dynamics & relative importance, i.e. in Political factor all seven companies considered that Govt. policies affects the NPD, in those 7, one company considered that Govt. Policies Impact when NPD starts & then reduce / stop inside 6-12 months, 04 Fast Food Company considered that its Impact when NPD starts & in the future beyond 6-12 months, while other one considered it’s No Impact when NPD starts but at some time in future 6-12 months & last one believed that Govt. Policies Impact intermittent over time on NPD. Whereas 06 companies out of 7 judged Govt. Policies has negative Impact on NPD, while only one considered that its impact positively on NPD. All seven companies agreed on one point that Govt. Policies have Impact of Increasing Significance, & its relative importance is critical according to 2 companies, very important for others 2 & remaining considered it’s as important for the Fast Food NPD process.
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Table C Relative Importance of Implication of external factors
Is factor affecting NPD
Dynamics
Relative Importance
s e Y
e c n a c i f i g t n n g g i c i a S n e a c p g h n m c n a I i c s n i e u f a f i v e i t r o n a c t i g n c S e I a N f o p m t I c a p m I
e c n a c i f i n g i S g n i s a e r c e d f o t c a p m I
l a c i t i r C
. p m I V
. p m I
t n a c i f i n g i S
. p m I n U
Labour Law
7 7 2
5
1 2 1
4 1 1
1 4 -
1 -
1 -
6 7 2
7 5 -
2 1
1
2 4 -
2 3 1
3 -
1
-
Trade Restrictions
1
6
-
1
-
-
-
1
-
-
1
-
-
-
1
-
Tariff
-
7
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4
3
3
1
-
-
4
-
1
1
2
1
-
1
2
-
GDP
2 7 1
7 5 6
1 3 1
1 3 -
1 -
-
1
2 7 -
1 -
-
1 7 1
1 1
1 2 -
1 -
1 1 -
2 -
HealthConsciousness
7
-
-
1
-
6
1
6
7
-
-
7
-
-
-
-
Population Growth Rate
4
3
-
-
3
1
3
1
-
3
1
-
-
2
1
1
7
-
3
2
2
-
3
4
3
2
2
3
1
1
1
1
4
3
-
1
1
2
3
1
-
3
1
-
-
1
1
2
6
1
-
-
1
5
5
1
-
1
5
-
-
4
1
1
Major Events & Influences
6
1
-
-
-
6
6
-
-
5
1
2
1
2
-
1
Ethnic/Religious Factors
6
1
-
-
-
6
3
3
-
5
1
2
4
-
-
-
Govt. Policies Tax
Economic
l a Growth c i m Interest Rates o Exchange Rates n o c Inflation Rate E
l a Age r u Distribution t l u Career Attitudes C o i c Consumer Buying o S Patterns
l a c i g o l o n h c e T
Type
e e e n c h m o u t o d s s e e i n h t r t a s i m n s n t h t h e t h & u t n r b s o t t n m c s o e o t t r a & m a 2 r m v o p a 2 t s 2 t 1 t t 1 s - s r 1 m n 6 a - D D 6 e D I O t e t s 6 d P e e P n P r t N D d v u i N i N t t P i s N o m n u i y n n e e f r N i s e b h i o n e n p h w t e o P n e e h t i s w r t m w / t t u c a i t t c t p c c a u m a a p p f I p o m m m I I N I
External Factors
l a c i t i l P o
Time
R&D Activity
3
4
-
-
2
1
3
-
-
1
2
1
2
-
-
-
Rate of Technology change
7
-
-
1
6
-
7
-
1
2
4
-
1
5
1
-
Technological Shifts
6
1
-
-
1
5
-
6
3
3
-
-
1
5
-
-
Innovation
5
2
-
-
-
5
4
1
-
1
4
-
1
2
1
1
Research Funding
-
7
-
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Limitations and Future Research
The critical limitation is that this study is conducted in a single geographical Region and the data collected from respondent not represent the entire business World, although it might be eradicate in imminent or future research studies regarding Macro Environment. Research study may conduct in 3 to 4 geographical area for a better generalization for the PEST Factors, because Macro Environment issues always fond of with the sphere of FFC’s or any Customer Services providing firms. Conclusion and Implication
This study examines the FFC’s that for New Product Development, is FFC’s scanning Macro Environment (PEST Factors) & what factors considered important according to the time of that factor, dynamics & relative importance. Environment scanning are always considered very imperative whether it relates to any industry, but in Fast Food Sectors, Customers association is sky-scraping due to the trend shifting, so a better product for their Fast food Customers is the answer for any FFC to get maximum profit & share in competitive market. In Pakistan, FFC’s doing PEST analysis for New Product development at very low level & considering Micro Environments important as compare to the PEST. Companies gaining competitive advantage after NPD, but this advantage not sustainable due to the intense competition in market. Fast Food business is increasing day by day, but Companies’ shouldn’t be pleased as this study characteristic had negatives feature & rating from different companies. FFC’s should concerned this in & future, be supposed to not work to get better & & trycan to fulfilled these spaces. These gaps will of widen if FFC’s taken so seriously create serious problems for delivery of services or products. In the age of rivalry Fast Food Companies Management should work for quality push of their products & should scan the rapidly changing that Environment for effective New Product Development, so FFC’s be able to find consumers response to become a internationally competent as customers response leads to perception then satisfaction. These procedures / actions and scanning may be costly in terms of marketing employees time, t ime, firm resources and effort, but FFC’s needs to find those ways to conquer these types of obstacles, otherwise Companies can lost their position, existing market share because of rising competition from National / international FFC’s.
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