A Brief Introduction to PESTLE Analysis
The business world is awash with acronyms, and one which has gained prominence in the last decade or so is PESTLE. To enlighten those not in the know, PESTLE is an extremely useful form of analysis which can help businesses with everything from strategic planning to project management and marketing. Business and leadership training specialists Maguire Training offers a comprehensive course which combines an exploration of both PESTLE and its associated analytical tool, SWOT (Strengths, Weaknesses, Opportunities and Threats). The module, Strategic Analysis - SWOT and PESTLE, explains to delegates the origins of PESTLE, teaches them how to use it correctly and effectively shows how to construct a PESTLE analysis.
Whilst formal training is essential to obtain the greatest benefit from a PESTLE analysis, a little prior knowledge can be very useful. Here, Maguire Training provides a brief introduction to PESTLE analysis.
What is PESTLE analysis?
PESTLE analysis evaluates the impact upon a business of a range of external factors. Six individual factors constitute the acronym from which this analytical tool takes its name:
Political; Economic; Social; Technological; Legislative and Environmental.
In its simplest form, PESTLE analysis requires finding an answer to the following questions:
- "What are the major (political, economic, social etc.) factors that currently affect my industry sector",
- "What impact are they likely to have on my business"
The findings of a PESTLE analysis will differ depending on the size and nature of each business, as different factors may have a greater or lesser impact.
Why should a business conduct a PESTLE analysis?
PESTLE analysis is simple and inexpensive to conduct, although it can be time-consuming. However, undertaken correctly, it can enable a business to gain an understanding of the wider issues affecting a particular industry and provide the insights required to predict and maximise areas of opportunity and minimise threat.
As such, PESTLE analysis is an invaluable tool for businesses looking at strategic planning for the medium or long term, or those which are about to embark upon new projects.
Are there any downsides to PESTLE analysis?
The six factors which are analysed by PESTLE methodology are constantly changing and therefore analysis should be periodically refreshed to ensure that a business can continue to anticipate their impact. Care must be taken to conduct the correct degree of analysis; too little may lead to an over-simplification or an under-estimation of potential business threats and opportunities, whilst too much analysis may result in a surfeit of information from which it is too difficult to extract meaningful insights.
For maximum benefit, the results of PESTLE analysis, which examines external factors and influences upon a business, should be considered in conjunction with internal factors which may equally impact it, such as cash flow, profitability, staff turnover, customer base and so on.
How can we help?
PESTLE analysis is undeniably valuable to strategy and project planning for businesses, providing benefits in many key areas and Maguire Training can enable leaders, business owners and managers to harness its full potential. In addition to providing Strategic Analysis using SWOT and PESTLE as a conventional classroom-based course, it is also conveniently available as online training via Maguire Training's innovative and intuitive E-learning platform.
