Professional Documents
Culture Documents
~ By Duncan Haughey
PEST is a strategic planning tool used to evaluate the impact political, economic,
social, and technological factors might have on a project. It involves an organisation
considering the external environment before starting a project.
Political Economic
Social Technological
Political Economic
Advantages of PEST
Straightforward and only costs time to do.
Provides an understanding of the wider business environment.
Encourages the development of strategic thinking.
May raise awareness of threats to a project.
Can help an organisation to anticipate future difficulties and take action to avoid or minimise their effect.
Can help an organisation to identify and exploit opportunities.
Disadvantages of PEST
Usually, a simple list and not critically presented.
The rapid pace of change in society makes it increasingly difficult to anticipate developments that may affect an
organisation in the future.
Collecting large amounts of information may make it difficult to see the wood for the trees and lead to 'paralysis by
analysis'.
Basing the analysis on assumptions that may prove to be unfounded.
PEST analysis only covers the external environment and the results need considering alongside other factors, such as
the organisation itself, competitors and the industry in which it is working.