the context of the organization consists of the environment in which it operates and refers

to internal and external issues relevant to the activity of the organization. As a first step in
defining the organizational context, I suggest following a course that will put you in a
position to better define your quality policy, to identify the business environment in
which the organization is active, to identify which internal and external issues in this
environment influence the organization, and to understand who the relevant interested
parties are. The following is the suggested process for an effective definition of the
context of the organization :
  The definition of the context of the organization will begin with PEST
(political,economic, social, and technological factors) analysis, which
will provide inputs for the strengths, weaknesses, opportunities, and
threats (SWOT) analysis.
 SWOT analysis will define inputs for the determination of the internal
and external issues.
 The determination of the internal and the external issues will help
identifying relevant interested parties.
 Identifying interested parties will assist in defining the scope of the QMS.
 The scope of the QMS will provide the foundation of the QMS.

PEST Analysis

#PEST stands for political, economic, social, and technological factors that may affect
the strategy of the organization. In order to understand better the context of the
organization, it is recommended to conduct a PEST analysis—analysis of different
conditions that affect the organization in the business environment in which it is active.
This analysis reviews the macro environment of an organization and is a useful tool for
understanding how a business environment behaves and affects the QMS. A business
environment will be analyzed by what it is addressing: the products, the customers’
expectations, the activities of the organization, and so on. And these are reviewed through
four different perspectives: political, economic, social, and technological. PEST analysis
identifies external factors that might change and while changing will affect or influence
the organization and its operations. Each of the factors (political, economic, social, and
technological) is used to assess the extent of influence of the business environment on the
ability of the organization to deliver a product according to its customers’ expectations.
The organization, on the other hand, cannot influence these factors but must try to adapt
to them. The outputs of PEST analysis will be used as opportunities and threats for the
later SWOT analysis, which will be discussed later. PEST analysis may be also extended
to seven or even more factors: ecological (or environmental), legislative (or legal), and
industry analysis, which uses the name PESTELI analysis. But I will concentrate on the
four main factors. The four parameters for analysis vary in significance and influence
depending on the type of organization, its business environment, and activities. For
example, a software development company should give more scale to the technology
while a voluntary association in a developing country should pay more attention to the
political conditions.