Question

Conduct a PEST analysis to evaluate the external environment of UnitedHealth Group.

Answer 1

The PEST analysis of United Health Group to evaluate the external environment is :

The political factors(P) affecting united health group is :

• The level of political stability in the country where the united health group operates.
• The trade barriers in the country where the united health group operates and if trade barriers exist it can lead to loss of export opportunities.
• A high level of taxes. When the tax rates are high, it acts as a deterrent for companies who wish ti maximize their income.

Economic factors(E ) affecting united health group :

• The growth rate of GDP in the country could also promote growth opportunities for united health group.
• When a larger section of the population remain unemployed, then the labor can be sourced at lower wage rates which can be beneficial for this company and help it reduce costs.
• The interest rates prevailing in the economy determines what would be the borrowing or lending rates. When the rate of interest is high this would mean greater level of investments made and this would result in a higher growth at United health group.

Social factors (S ):

• The age, sex, race and religion of the people who the company is targeting is very crucial weather a certain product can be marketed to the people.
• The class of the population where united health is promoting is products is very crucial, If a premium products is targeted to people of low class then the chances of  success of the product is going to be very low.

Technological factors (T) :

• How easily the technology adopted by a company can be followed by competitors and easily copied by them. If the technology can be easily copied then the business of united health group may suffer.
• The technology adopted by the company can have a potential impact on it's costs.These costs can impact the profits or losses greatly. If the profits are sufficient, then the business can further invest in new technology and research and development activities.