How to Conduct a PESTLE Analysis

A PESTLE analysis is a useful tool for understanding the ‘big picture’ of the environment in which an organisation is operating.

How to Conduct a PESTLE Analysis

A number of external factors can have a significant impact on the performance of a company, which determines how successful a business can be. But how can you assess all the factors affecting your business? This is where the role of a PESTLE analysis can assist. PESTLE analysis is the most popular tool used for analysing a business. It helps in making decisions and obtaining a clear picture of the company in the market. So, as an employer, you must have a complete understanding of this invaluable business tool. PESTLE analysis constitutes the following 6 factors.

  • P – Political
  • E – Economical
  • S – Sociological
  • T – Technological
  • L – Legal
  • E – Environmental

These six factors are effective in promoting the company’s growth regarding its revenue, profitability and corporate success.

Significance of PESTLE analysis

Pestle analysis helps the employer to consider different factors to promote strategic thinking and planning. A PESTLE analysis of the external environment also helps in identifying opportunities, which in turn helps you take steps to close any gaps. Moreover, it allows you to keep track of the market trends and what your competitors are doing to survive.

Steps to follow

  • Understand each of the PESTLE factors
  • Collect as much relevant data as possible
  • Evaluate and identify opportunities
  • Take action

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