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PESTEL Analysis as a Baseline to Support Decision-Making in the Local Textile Industry

Abstract:

The concept of sustainability has several possible meanings in the Ecuadorian context. This is especially true when it comes to the business sector because of the complexity related to implementing the Good Living concept and honoring the constitutional Rights of Nature. In Ecuador, most of the business sector is represented by micro, small, and medium-sized enterprises (MSMEs). Thus, their role in the development of national economies is crucial. This sector has difficulty adapting its organizations to the way of sustainable development. In fact, the decision to incorporate the principle of sustainability in this transition period is a big challenge for MSMEs due to their limited resources and the competitive environment they face. This work studies the contextual aspects influencing the regular operations of the Ecuadorian MSMEs, with particular emphasis on the textile industry. To do so, a comprehensive literature review was performed by applying a political, economic, social, technological, environmental, and legal (PESTEL) analysis. As a result, factors and implications were identified and explained in context, comprehensively, not individually. The information gathered yielded an overview of the sector, which serves as a baseline for the definition of the required models and tools for supporting sustainable decision-making in the local context.