Discuss Pest Analysis On CNA Financial Corporation within the Principles of Management ( P.O.M) forums, part of the PUBLISH / UPLOAD PROJECT OR DOWNLOAD REFERENCE PROJECT category; CNA Financial Corporation (NYSE: CNA) is a financial corporation based in Chicago, Illinois, United States, and noted for its 600-foot ...
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Pest Analysis On CNA Financial Corporation
Pest Analysis On CNA Financial Corporation - December 3rd, 2010
CNA Financial Corporation (NYSE: CNA) is a financial corporation based in Chicago, Illinois, United States, and noted for its 600-foot (180 m) tall red headquarters building, CNA Center. Its principal subsidiary, Continental Casualty Company (CCC) was founded in 1897. CNA (the parent company) was incorporated in 1967. The primary business focus of CNA is to provide commercial property and casualty insurance to businesses and professionals. CNA markets its products and services primarily through independent agents and brokers.
CNA itself is 89% owned by a holding company, Loews. This holding company also has interests in offshore oil and gas drilling rigs, natural gas transmission pipelines, tobacco, and in hotel operations.
Continental Assurance Company of North America was founded in Detroit in 1897. The purpose of the company was to provide accident and health insurance to railroad industry employees. This company then merged with the Metropolitan Accident Company, changed its name to the Continental Casualty Company, and moved to Chicago.
The National Fire Insurance Company was acquired in 1956, and in the 1963 the American Casualty Company was acquired. The first letters of each of the original companies were merged to form the acronym CNA. It was then referred to as the Continental National American Group, now it simply goes by CNA.
The PEST Analysis is sometimes referred to as the STEP (Socio-cultural, Technological, Economic, and Political) Analysis. This tool is used to look at the external factors that tend to influence the organization. (2001) Normally, this analysis is used for planning such that the company would be able to complement their pursuit of the organizational goals with the influences and demands put forth by the environment. This provides flexibility for the company such that they are able to take in hand the pressures of the external environment. (2001)
A. Political Factors
The Hong Kong Special Administrative Region (HKSAR) has been under the rule of mainland China for several years already after the handover of the British Government. Nevertheless, it has been given a free hand in implementing business-friendly laws in the land. ( 2004) These liberties allowed companies like Starbucks Coffee Company International the capability to operate in the said country. Moreover, the company has to similarly be compliant of any other rules and regulation imposed by the HK government.
B. Economic Factors
Hong Kong has been considered as one of the commercial destinations in Asia. There has been a considerable flow of traffic particularly involving tourists and other travelers in Hong Kong. Travelers from the mainland have been very prevalent in the recent years in Hong Kong. (2006) On the other hand, travelers from the neighboring regions have also flocked the country with the opening of the Disney theme park. (2002) This means that the consumer base of Starbucks Hong Kong is considerably affected by these changes in the economic standing in the country, particularly the influx of consumers not only from the mainland but also from the other spenders from the adjacent Asian states.
C. Socio-cultural Factors
The socio-cultural aspect of Hong Kong would be greatly discussed with the use of and (1985, in and 1996) seminal work regarding cultural dimensions. Hong Kong is categorized under far Eastern cluster. This means that the said state possess a culture that has high power standard, low uncertainty avoidance, very collective, and masculine. Hong Kong has been indicated to have a highly masculine society. (2001) This shows that the major structures of the society in Hong Kong are dominated by male. Needless to say that Hong Kong has a high level of gender differentiation present in its society. (1999) indicated in their book that Hong Kong is classified as a high power distance culture. This means that wealth and power are indicators of success and influence in society. Recent studies show that Hong Kong society has a rather collectivist culture. ( 2003) Thus, this means that interpersonal relationship is regarded highly in this region. The study of (1999) indicated that Hong Kong has a low uncertainty avoidance in its culture. This shows that the consumers in the country tend not to plan their purchases. Moreover, Hong Kong is said to have a strong long-term orientation. (1999) This means that the consumers in Hong Kong tend to become loyal to a brand once they have been satisfied with its product or services.
D. Technological Factors
Majority of the consumers in Hong Kong are greatly capable of using computer-based platforms. (2003) With a highly technologically savvy population, the consumer base on the said country tends to look at the factor of convenience as an advantage. Some studies indicate that a considerable number of Hong Kong consumers shop online. (2004) In other words, Starbucks could take advantage of this fact and start a platform that will essentially cater to this need of the consuming public.
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