PEST Analysis

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Scanning the external macro-environment in which a firm operates. Explanation of PEST Analysis. STEEPLE.

What is PEST analysis? Description

The PEST analysis is a framework that strategy consultants use to scan the external macro-environment in which a firm operates. PEST is an acronym for the following factors:

• Political

• Economic

• Social

• Technological

PEST factors play an important role in the value creation opportunities of a strategy. However they are usually outside the control of the corporation and must normally be considered as either threats or opportunities. Remember macro-economical factors can differ per continent, country or even region, so normally a PEST analysis should be performed per country.

In the table below you find examples of each of these factors.

Political (incl. Legal)	Economic	Social	Technological
Environmental regulations and protection	Economic growth	Income distribution	Government research spending
Tax policies	Interest rates & monetary policies	Demographics, Population growth rates, Age distribution	Industry focus on technological effort
International trade regulations and restrictions	Government spending	Labor / social mobility	New inventions and development
Contract enforcement law Consumer protection	Unemployment policy	Lifestyle changes	Rate of technology transfer
Employment laws	Taxation	Work/career and leisure attitudes Entrepreneurial spirit	Life cycle and speed of technological obsolescence
Government organization / attitude	Exchange rates	Education	Energy use and costs
Competition regulation	Inflation rates	Fashion, hypes	(Changes in) Information Technology
Political Stability	Stage of the business cycle	Health consciousness & welfare, feelings on safety	(Changes in) Internet
Safety regulations	Consumer confidence	Living conditions	(Changes in) Mobile Technology

 

Completing a PEST Analysis is relatively simple, and can be done via workshops using brainstorming techniques. Usage of PEST analysis can vary from: company and strategic planning, marketing planning, business and product development, and research reports.

Variants of PEST Analysis

Sometimes extended forms are used, such as SLEPT Analysis (plus Legal) or the STEEPLE Analysis: Social/demographic, Technological, Economic, Environmental (natural), Political, Legal and Ethical factors. Also Geographical factors may be significant.

Special Interest Group - PEST Analysis Special Interest Group (377 members)

Forum - PEST Analysis   In the forum section you will find recent discussions within this knowledge area.   PEST / PESTLE Criticisms What are some of the criticisms of the PESTEL Analysis?...           PEST Analysis for a Country (4 reactions) Does anyone know where I can get a PEST analysis on a countr...           External Environment of a Service Company (3 reactions) I need to examine the external environment of a recruitment ...           PEST Analysis is Complementary to SWOT Analysis (3 reactions) PEST is one of the essential tool to supplement the SWOT ana...           PEST Analysis Standard Format? (1 reactions) I have to do a PEST analysis. Is there a standard format (li...           System Risk in PEST Analysis (1 reactions) As per recent global recession, how do you include in PEST a...           Advanced form of PEST: PESTELEM Analysis (2 reactions) An advanced form of PEST analysis is called PESTELEM Po...           Direct and Indirect External Environment of the Firm What is needed to survive in dynamic environment. The wor...           How to Conduct a PEST Analysis? Main Steps and Tips (1 reactions) Is there a specific way in performing a PEST analysis, or is...           BOOK: The SPELIT Power Matrix (1 reactions) The SPELIT Power Matrixis similar to PEST. It details how to...           PEST Analysis on Retail (1 reactions) Does anyone have a pest analysis on a retail industry. Thank...           Organisational Analysis (1 reactions) I would be grateful if I could be permitted to refer to the ...           Improved PESTLE Analysis: SATERPLIDE Analysis (1 reactions) In my work I have found a need to improve the conventional <...           Other Marketing Environment Tools (1 reactions) Apart from this PEST framework used to analyze the macro env...           PEST Analysis for Non-Profit Organizations Hi, I need opinions whether PEST analysis is the best tool t...           Unfavorable External Environment? When do I realize that the environment I am operating in is ...           History of PEST - Origins and Author (2 reactions) I am wondering about the origins of PEST. And also about the...           Interaction Between an Organization and Its Energy Environment? (1 reactions) I read a text about organizational-environmental interaction...           What is a Business Environment It is the aggregate of all conditions, events and influences...           Environmental Factors in PESTLE (1 reactions) In PESTLE, what are examples of typical environmental factor...           Technology Marketing and Economic Analysis in Utilities A small developing economy creates a new government funded R...

Best Practices - PEST Analysis In the best practices section you will find the best forum discussions within this knowledge area.   Extension of PESTEL + C (=Competitors) Analysis (1 reactions) In discussions with a tutor at Deltic Training College (Mark...

Expert Tips - PEST Analysis In the expert tips section you will find advices from experts within this knowledge area.   How to Analyze the Strategic Significance of some External Trend? Analysis of Macro-environment, Strategic Environment...       Advanced Ways of Applying PEST Analysis Analysis of Macro-environment, Strategic Environment...       Extensive 12-Factor PEST Analysis International Strategic Environmental Analysis...       WHEN to use PEST analysis? Situations and Application Areas PEST Analysis, Application Areas, Analysis of Macro-environment...       How to Refine my Initial PEST Analysis? Advanced PEST Analysis...       Why Society is More Risky than Before Understanding New Risk Categories, Risk Management...       Government Policies / Economic Policy Tools in PEST Analysis PEST Analysis, Government Analysis, Analysis of Macro-environment, Strategic Environment...

Resources - PEST Analysis In the Resources section you will find powerpoint presentations, micro-learning videos, articles, news items, etc. within this knowledge area. PEST Analysis Template PEST Analysis...   External Environment In-depth: Sub-types and How to Manage Them External Environment, Environmental Scanning, Environmental Management, Competitive Environment...   PEST Analysis for Small and Medium-sized Companies Initial Understanding of PEST Analysis, Summary...   Introduction of the P of PEST Analysis: Political Initial Understanding of PEST Analysis...     News about Pest Analysis         News about Macro-environment Analysis         Videos about Pest Analysis         Videos about Macro-environment Analysis         Presentations about Pest Analysis         Presentations about Macro-environment Analysis         Books about Pest Analysis         Books about Macro-environment Analysis         More about Pest Analysis         More about Macro-environment Analysis

Compare with: SWOT Analysis  |  OODA Loop  |  Simulation  |  Five Competitive Forces  |  Stakeholder Analysis  |  Stakeholder Mapping  |  Benchmarking  |  Scenario Planning  |  Diamond Model  |  Strategic Risk Management

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