PESTLE

PESTLE template External factors to consider Factors affected within my industry Importance to organisation

	External Factors to Consider	Factors affecting the Industry	How my Organisation is affected
Political	Government policy Political stability Tax Industry regulations Global trade agreements and or restrictions
Economic	Exchange rates Globalisation Economic growth / decline Inflation Interest rates Cost of living Labour costs Consumer spending habits
Social	Consumer trends /tastes, Fashions Consumer buying habits Lifestyle factors Career attitudes Work-life balance Population demographics
Technology	Automation Innovation Disruptive technologies Social networking Upgrades Robotics Artificial Intelligence Security
Legal	Employment law Common law Local labour law Health and safety regulations
Environmental	Environmental restrictions imposed by in-country governments Sustainable resources CSR (Corporate social responsibility) Ethical sourcing Transportation Procurement Supply chain management

In 2020 PESTLE considerations might be Brexit, extinction rebellion and the environmental campaign, carbon neutral targets and the disruption to the supply chain because of the Coronavirus outbreak.

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Pestle

Use the PESTLE analysis model introduced in step n. 1 to assess the macro-environmental factors affecting your business. There is a 4-step process to use the macro business analysis framework and identify specific external risks and how they affect your industry or business. [Sources: 11]

The first thing to do is to use the Macroeconomic Environment Business Analysis Framework to brainstorm all the externalities of your industry (from each of the 6 domains). Using the above PESTLE analysis will allow companies to consider many external factors before launching a new product or entering a new market. Using analytics tools like PESTLE is often not about making immediate decisions, but about external factors outside your company’s control, the categories they exist in, and how they affect the growth of your business or product. The results of the PESTLE analysis allow companies to make specific choices when planning the future of the company, from how the brand should be presented, to any changes to the company’s organizational structure, to the development of new products. [Sources: 7, 9, 11]

The PESTLE analysis provides a suitable structure and activity for use in various business planning situations. PESTLE analysis can help prioritize business activities to achieve specific marketing goals within a given time frame. PESTLE is an analytical tool available to companies to determine how external factors affect their operations and make them more competitive in the market. PESTLE is an analytical tool that determines how various factors can influence an organization and its competitive position. [Sources: 4, 7]

PESTLE analysis is a strategic planning tool used to study the various factors affecting the market environment for a company or organization. PESTLE analysis allows managers, marketers, and financial experts to examine specific factors (other than money) when making decisions about a company’s services or products. The goal of PESTLE analysis is to develop a deep understanding of the external environment in which a company or organization operates. PESTLE analysis is one of the most commonly used models for evaluating a highly dynamic external business environment. [Sources: 0, 7, 10]

A growing body of research applies this analytical tool to a variety of sustainable projects, including assessing external factors influencing coastal and freshwater management decisions,7 sustainable building development,8 sustainable energy solutions , 10] 11 and transport. As mentioned above, successful companies often use PESTLE analysis in conjunction with other macro-environmental analysis tools such as SWOT and Porter’s Five Forces. In this case, PESTLE is most effective when used in conjunction with a SWOT analysis to provide information on potential opportunities and threats related to job changes; for example, skills shortages and the current skills of the workforce. [Sources: 0, 4, 11]

SWOT analysis examines these factors at the company, product line or product level. A PEST analysis examines the “big picture” factors that may influence a decision, market or potential new business. PEST analysis can help you understand the forces of change in the “big picture” you are exposed to, and build on them to capitalize on the opportunities they provide. [Sources: 5]

Key Points PEST analysis will help you understand the political, economic, social and technological changes that will shape your business environment. The PEST Analysis is a simple and widely used tool to help you analyze the political, economic, socio-cultural and technological changes in your business environment. In this article and the video below, we’ll see how you can use PEST analytics to understand and adapt to your future business environment. PEST analysis helps identify business or personal opportunities and provides early warning of significant threats. [Sources: 5]

PEST analysis (policy is part of the external analysis in conducting strategic analysis or market research and provides an overview of the various macro-environmental factors that need to be considered. PEST analysis (political, economic, socio-cultural and PESTLE analysis, or sometimes called PEST or PESTEL analysis) is a business framework used to analyze the factors in the macroeconomic environment that affect the company as a whole PESTLE analysis provides employers with a framework to examine certain factors in the wider world – the conditions in which they operate with no control – and how they affect their business so that they could be better prepared. [Sources: 0, 1, 11]

PESTLE analysis can help identify disruptive changes in business models that could have a profound impact on future employment. PESTLE analysis should be conducted during the first phase of crisis recovery, the response phase, when business leaders assess what happened and how the crisis is affecting their business. You may also consider hiring experts on PESTLE factors from within and outside your organization to provide a summary of the current situation and impact on your business. Ideally, the factors included in a PESTLE analysis should always be kept in mind in the day-to-day work of business leaders and in meetings with key influencers and stakeholders. [Sources: 1, 4]

This is an important difference from SWOT analysis because, unlike an organization’s strengths and weaknesses, none of the PESTLE factors are directly or inherently related to the business, organizational operations, or culture. At its best, PESTLE analysis is an increasingly in-depth way to understand the big picture of the external environment that affects an organization in the short and long term, and to set possible parameters for the organization’s success. The PESTLE analysis report provides the management team with a wealth of contextual information about the company, such as the company’s direction, brand positioning, growth goals, and areas of focus that could lead to business growth and productivity declines. PEST analysis can help you get rid of unconscious assumptions when entering a new country, region or market; because it helps you to look at this new environment objectively. [Sources: 5, 6, 10]

Sources

[0]: https://en.wikipedia.org/wiki/PEST_analysis

[1]: https://www.insperity.com/blog/pestle-analysis/

[2]: http://www.phf.org/resourcestools/Pages/PESTLE_Chart.aspx

[3]: https://libguides.library.usyd.edu.au/c.php?g=508107&p=5994242

[4]: https://www.cipd.co.uk/knowledge/strategy/organisational-development/pestle-analysis-factsheet

[5]: https://www.mindtools.com/pages/article/newTMC_09.htm

[6]: https://www.analyticssteps.com/blogs/what-pestle-analysis

[7]: https://www.investopedia.com/ask/answers/041015/whats-difference-between-porters-5-forces-and-pestle-analysis.asp

[8]: https://libguides.bentley.edu/industryresearch/PESTLE

[9]: https://ecampusontario.pressbooks.pub/bio16610w18/chapter/pestle-analysis/

[10]: https://www.batonglobal.com/post/introduction-to-pestle-analysis-and-why-a-systemic-approach-is-best

[11]: https://www.thepowermba.com/en/blog/pestle-analysis