Mock Examination 2 Question 1

(a)
Political factors
Network Management Systems (NMS) is situated in a country of Elsidor, a
prosperous developed nation with well-established political system. (P1L2L3).
Successive government in the aimed of promoting technology by providing
grants and incentives. Besides, tax credits are provided to cancel off with the
investment in R&D. (P1L3-L4).
Government shows supports in technology by awarding
government reputation for the successful products. (P5L5-L6).

prestigious

Government acts as quality regulators. All new components need to be

approved by an appropriate government approval body. (P4L11-L12)

Economic factors
Economic cycle will affect the demands in a country. For example, in 2010 the
country suffered an economic downturn. As a result, a lot of companies are
forced to delay their technological investment. (P1L6-L7)
In Elsidor, there is significant legislation defining maximum working hours
and minimum wage rate. (P4L11) Thus, during economic downturn, NMS
could not reduce the wages cost. It is likely that NMSs labor cost will be more
expensive than its competitors.

Social factors
In years, social networks seems to play an important role in daily lives. It is
likely that it will continue to increase the level of social networks. Although
NMSs revenue is declining from $6.9mto $6.2m (2009-2010), (Figure 2) it is
likely that social networks will provide opportunities for growth in the
industry.

Technological factors
NMS is a high-tech business. This sector is extremely innovative as
technology keeps changing. With the maturity of technology, product
lifecycles in NMS are becoming shorter.
NMS needs to aware of new technologies introduced by its competitors. By
concerning those technologies, NMS could consider to use them in the own
products.

Environmental factors
Wastage matter is likely to be part of the environmental issue as NMS is
dealing with electrical items. Eg: machine. Although the machine leads to
reduced wastage of up to 10%, (P9L7) NNS still needs to deal with the
remaining disposal carefully. NMS is encouraged to recycle of the disposal of
electrical items if they can be used in other ways.

Legal factors
NMS need to compliance the legislation relate to the employees right
(maximum work house and minimum wage rate). In order to reduce the
compliance costs, NMS could take the chance of relocating to a country with
less stringent requirements.