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1. General information
In the exam: choose either PEST or PORTERs five forces; an answer booklet and a
fresh printed Tronics case will be provided (just bring yourself, pens, and big
GRINS^^)
Structure: essay (3 parts)
o Introduction
Pest (p,e,s,t) analysis is a strategic tool to assess macro-environment
(refer to Panahs slide and cite him; (Panah, 2016)
Tronics and oil industry introduction in around 1 or 2 sentences
(Products: MEMS components;
competitors MEMS producers; substitutes: not really have
Industry: oil exploration industry)
Intention of the essay: to apply PEST/Porters in the Tronics case
o Body
o Conclusion
Pest: which is the most significant pest factor influence on risk, cost
and benefits?
Porters: how attractiveness of the industry
Numbers of the words: (advice: from 500 600- 700 and 800 words; maybe not over
1000 ) enough and relevant information, examples
Process of developing essay: theory > applying to the case
o Example: Recession influences on the companies in terms of revenues.
When recession, demand reduces. During the recession in 2009, oil industry
dropped 12%; Vibtech 13%.
MEMS product in oil exploration industry and competing with MEMS producers
2. PEST analysis
Introduction about PEST analysis.
PEST analysis (political, economic, social and technological). Changes in the macroenvironment (measured by PEST) can impact on the industry environment (measured by
Porters five forces), thereby influencing the internal environment of organisations
(resources and capabilities) (Panah, 2016).
The essay will examine each macro-environment factor influences on the industry
environment (oil prospection industry) and then MEMS firms like Tronics in terms of the
costs, risks and benefits of doing business nationally or internationally.
(FOCUS on the market)
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Economic growth
o Oil products are the most necessitated commodity
o Moreover, the market is expected to be healthy with an increase in the
demand, particularly in developing countries, even though recession is still
affecting developed countries. As the data in the case study, the global
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producers, Tronics has the advantage focusing on the niche market and having
product differentiation
> Buyers (oil companies) have moderate power of bargain; except for the
stakeholder Vibtech has higher barging power
3.5. Supplier power (market inputs): Moderate
Supplier switching costs relative to firm switching costs: moderate
Suppliers (including vacuum pumps, ceramic packing vacuum pumps, etc) have
dependence on:
- R&D research centers
- Universities
(Example: Research centres in Grenoble, France, Switzerland, Germany,
Japan, etc
New suppliers: French firm to assemble and package chemical vacuum pump)
- Other institutions
- Government support
However, suppliers have different choices between research centres, universities,
etc.
Value chain sharing so MEMS firms and suppliers have strong link especially
knowledge aspects as well as process of MEMS production
Conclusion: (MODERATE ATTRATIVENESS) risky but rewarding to invest
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