PESTLE Analysis

PESTLE Analysis – assess the world around you

The PESTLE analysis is a framework of six subjects used to help an organisation get a ‘big picture’ view of the world around them, and adapt as needed.

It is also a very useful tool for us individuals too. It gives us a starting point to get our very own big picture view of the world. And then make a plan to get the most out of the new information we find.

PESTLE is simply an acronym of 6 subjects which are used to provide a good starting point to search, to scan, for matching news and information. They are…

Political

Economic

Social

Technological

Legal

Environmental

 
What are the benefits of me doing PESTLE analysis?

Firstly, the process of doing this exercise will help you to clarify, in you mind, what is important to you. Or at least, give you a few worthy things to keep an eye on.

Secondly, this tool will provide a base to help you identify potential opportunities and threats to your and/or your family. If and when you spot an opportunity or threat, you can act on it, make a plan and do something about it. Either benefit from finding some early news, or reduce the impact of something bad happening.

Lastly, what you write down will lodge a place in your memory. Then as you go about your daily life with reading the internet, reading newspapers and magazines, or just talking to friends, a single bit of information may just jog your memory and draw your interest to find out more. And more. And hopefully help you spot that opportunity or threat.

How to do the PESTLE analysis 

First off, know that the PESTLE acronym is just a template, so you could add more subject header as you need. In fact, it started out as just PEST (or STEP) analysis, then over the years has taken on the Legal and Environment subjects.

A small fyi here – there are a bunch of other acronyms this goes by – STEEPL, SPEPLE, STEEP, SLEPT, PETSLE, PESTL, PESTEL …

To to the analysis, follow the below steps

  1. Start by setting out a table like you see below, and write in each PESTLE subject in the left column.
  2. For each subject, write in the issues that concern you – these are the specific factors that you will be tracking.
  3. Research each factor to assess if there are any opportunities or threats to you. Write them into the table.
  4. Plan & write in your actions to respond to each opportunity or threat.
 
Example PESTLE analysis:-
SubjectSpecific factors to assessAssessmentActions
PoliticalElection result
Political & policy changes

Opportunities: none identified

Threats:  a political direction that changes my pension

Adjust pension plan to use index linked funds

EconomicPersonal tax this year
Currency changes impact on pension fund

Opportunities: reduce personal tax

Threats: higher cost of tax assessment

Get list of changes

Do my own tax? Or accept cost of tax advisor. 

SocialSocial changes affecting me & my family
Changes in attitude on Welfare, Medical aid, migration.

Opportunities: stay in touch with family

Threats: none identified

Phone mum more often…

Technical

Technology – helping or hindering 

Track Fintech, Digital Currencies, Artificial Intelligence (AI), and Biotech news

Opportunities: use technology for own benefit…but

Threats: online security is a big problem 

Re-assess all tech we use.

Change ALL passwords

Use multi authentication

Legal

Local law changes relating to business 

Opportunities: none

Threats: even more laws to know – cost to adhere to new laws

Ask local council for list of changes. Assess and abide.

Environmental

Environmental change

De-forestation, Climate change, sustainability, plastics in the ocean

Opportunities: hard to determine

Threats: so many ! 

Reuse, reduce, recycle.

That’s a good start for a very general PESTLE analysis.

To be a little more advanced, how about writing a PESTLE page for each of your important Life Areas (Family, Career, Health, etc. see more here), with the PESTLE subjects and the factors that are particularly relevant.

Remember, you don’t need to use every subject. Take your life areas ‘Fun’ for example – the Legal subject is probably just not needed. But it may be, if your fun is BASE jumping!

For even more advanced analysis, you could break down the factors into Local, National and International sub-headings. This breakdown will also help you focus on how close issues are and what sources of information are best suited. For instance, Google News or a Google search on you local news, may not be quite as good as reading your local newspaper. 

Political

Local:

Local elections

National:
National (federal) political & policy changes

International:

Elections in {another country}. Do their politics even matter to me?

Economic

National:
Personal tax this year

International:

Currency changes impact my pension fund

Social

Local:

Local volunteer and Meetup groups  

National:
National zeitgeist regarding Welfare, Medical aid, migration

International:

Social trends of the year

Technical

Local:

Local technology startups

National:

Track country Fintech, Digital Currencies, Artificial Intelligence (AI), and Biotech startups

International:

Future tech for next year

Legal

Local:

Local law changes to business operations 

Environmental

Local:

Nearby De-forestation

Cleanup of plastics on my local beach

National:

Recycling policy

International:

Climate change

Spread of infectious disease

Then what?

By itself this is, hopefully, a very useful exercise to do. And as noted earlier, just doing the exercise is useful to clarify your thoughts, useful for spotting opportunities and threats and, finally, places these factors into your memory for future recall.

You could just leave the exercise there, and keep the pages for reference.

Alternatively, include the PESTLE analysis into your Environmental Scanning. Read more here at Goalmuse > Environmental Scanning

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More Reading

PEST analysis

PEST analysis (political, economic, socio-cultural and technological) describes a framework of macro-environmental factors used in the environmental scanning component of strategic management. It is part of an external analysis when conducting a strategic analysis or doing market research, and gives an overview of the different macro-environmental factors to be taken into consideration.

PEST Analysis: Identifying Big Picture Opportunities and Threats

Changes in your business environment can create great opportunities for your organization - and cause significant threats. For example, opportunities can come from new technologies that help you reach new customers, from new funding streams that allow you to invest in better equipment, and from changed government policies that open up new markets.

What is PESTLE Analysis? - Definition & Examples - Video & Lesson Transcript | Study.com

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