What is PEST analysis?
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:
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Political
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Economic
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Social
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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)
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Economic
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Social
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Technological
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Environmental regulations
and protection
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Economic growth
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Income distribution
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Government research spending
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Tax policies
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Interest rates & monetary
policies
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Demographics, Population
growth rates, Age distribution
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Industry focus on technological
effort
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International trade regulations
and restrictions
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Government spending
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Labor / social mobility
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New inventions and development
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Contract enforcement law
Consumer protection
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Unemployment policy
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Lifestyle changes
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Rate of technology transfer
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Employment laws
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Taxation
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Work/career and leisure
attitudes
Entrepreneurial spirit
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Life cycle and speed of
technological obsolescence
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Government organization
/ attitude
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Exchange rates
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Education
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Energy use and costs
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Competition regulation
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Inflation rates
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Fashion, hypes
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(Changes in) Information
Technology
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Political Stability
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Stage of the Business Cycle
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Health consciousness &
welfare, feelings on safety
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(Changes in) Internet
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Safety regulations
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Consumer confidence
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Living conditions
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(Changes in) Mobile Technology
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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.
Courses about PEST Analysis.
Beginners Course
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Advanced Course
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Course for Experts
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Forum discussions about PEST Analysis.
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Market and System Risk in PEST Analysis
As per recent global recession, how do you include in PEST analysis the risk factor due to mass negligence of control mechanism in financial sector in developed countries both by Government and public...
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The best, top-rated topics about PEST Analysis. Here you will find the most valuable ideas and practical suggestions.
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The SPELIT Power Matrix
The SPELIT Power Matrix is similar to PEST. It details how to internally and externally assess an organization utilizing the Social, Political, Economic, Legal, Intercultural and Technological aspects...
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Advanced insights about PEST Analysis. Here you will find professional advices by experts.
Consultancy Tips
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Teaching Tips
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Practical Implementation Tips
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How to Analyze the Strategic Significance of some External Trend? Analysis of Macro-environment, Strategic Environment To think over which of the trends in the PEST analysis are going to be really important for a firm, one can use the 5 fo...
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Extensive 12-Factor PEST Analysis International Strategic Market Analysis Nations that companies expand to can vary in countless aspects, including consumer behavior (customs, spending habits, d...
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Advanced Ways of Applying PEST Analysis Analysis of Macro-environment, Strategic Environment When you are examining the external environment of a firm through a PEST Analysis, besides the obvious understanding of ...
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WHEN to use PEST analysis? Situations and Application Areas PEST Analysis, Application Areas, Analysis of Macro-environment A PEST-analysis contributes to the success of a company, because any specific organization can only be successful it it ...
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How to Refine my Initial PEST Analysis? Advanced PEST Analysis A PEST analysis can further be refined by incorporating the SWOT framework for each of the dimension mentioned here, i.e...
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Why Society is More Risky than Before Understanding New Risk Categories, Risk Management In his 1992 book "Risk Society: Towards a New Modernity”, Ulrich Beck describes new risk scenarios that companies have t...
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Government Policies / Economic Policy Tools in PEST Analysis PEST Analysis, Government Analysis, Analysis of Macro-environment, Strategic Environment Governments use several economic policy tools to achieve a set of goals. Managers of industry must have their focus on o...
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Various sources of information regarding PEST Analysis. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops.
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Useful tools regarding PEST Analysis.
News
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Videos
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Presentations
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Books
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Academic
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More
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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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