PESTEL stands for
egislative. It is a great tool for any size organizationwho would like to have a simple to use tool for understanding theexternal forces influencing their market and performance. If you wouldlike a good tool for external forces.PESTEL is a strategic planning tool; it helps you see the landscapebeyond your own market. This is important because as we are seeing inthe stock markets, what happens in China, does impact what happens onMain Street. The PESTEL is great for ensuring you don’t thinkingyourself into a vacuum. There are times when an organization thinksitself too internally and forgets to understand the power of the outsideforces. PESTEL helps to remind people, there are forces out there,directly and indirectly, impacting how your business performs.A PESTEL can be used with other tools such as a SWOT analysis,helping you understand in some cases, why a particular service or productis performing the way it is. For example, say you have a product that hasseen significant decline in the past few years in terms of sales volume inyour traditional markets.PESTEL can be used in Scenario based forecasting. These are your“what if” situations. You can take the PESTEL data and forecast futuretrends and develop a more global and typically better forecasting modelfor your Scenario based forecasts.
The down side to a PESTEL is that it will generally give you generaldata, this is a lot of economic and trend data you can find in the WallStreet Journal. For a small business, that’s just fine, that level of information is generally all you need. If you want a more detailed androbust tool, you need to move up to the Market Review Tool which doescreate a more detailed picture.
PESTEL is simpler to use than the Market Review tool which is a ratheradvanced tool that does the same and then some. It provides more
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