advantages and disadvantages of pestle analysis pdf

Advantages and disadvantages of pestle analysis pdf

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Pestle Pestel Advantages and Disadvantages – Limitations

Accounting Rate of Return – Evaluating Two Mutually Exclusive Projects – PDF

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In this ever-changing, highly complex and competitive global business environment, the organizations and the managers are facing enormous challenges and paying much more attention on strategic planning and analysis. Strategic planning tools and analysis help organizations to identify key elements affecting the environment as well as performance and growth of the organization. PESTLE analysis is a strategic framework which is used for competitive analysis in the macro environment. This generic tool helps the organizations to analyze its position or product in the market. This tool helps us in identifying and analyzing the key drivers of change in a strategic business environment.

It offers people professionals insight into the external factors impacting their organisation. The analysis is flexible, so organisations can use it in a range of different scenarios. People professionals and senior managers can use the results to guide strategic decision-making. For a transcript of this video, please scroll to the end of the page. Political : Tax policy; environmental regulations; trade restrictions and reform; tariffs; political stability. Sociological: Cultural norms and expectations; health consciousness; population growth rates; age distribution; career attitudes; health and safety.

Pestle Pestel Advantages and Disadvantages – Limitations

Pestel Analysis is a valuable strategic tool that can determine the level of the market attractiveness for the chosen country, the best start of the process would be environmental scanning. None of the frameworks is perfect. They all have their strengths advantages and weaknesses disadvantages-limitations. One of the main strengths of PESTLE is that is straightforward and easy to understand but at the same time, this framework is providing an overall view of organisation business environment. At the same time environment can change quickly and it can be quite a challenge to predict what kind of impact PESTLE factors can have on organisations future. Unless evaluated in an unbiased and highly critical way all the data gathered from PESTEL analysis might lead an organisation to wrong strategic decisions.

A PESTLE political, economic, sociological, technological, legal and environmental analysis — also sometimes called a PESTEL analysis if the order of the legal and environmental sections are reversed — is an analytical tool similar to a SWOT strengths, weaknesses, opportunities and threats analysis. It is highly flexible, as it can be used for marketing, human resources, business development or other situations and allows for a quick, easy-to-read overview of the key factors affecting an organization from the outside. This can help managers make important strategic decisions quickly and effectively. Before you decide to conduct such an analysis, it's important to be aware of both the potential strengths and limitations of using PESTLE analyses. While the PESTLE analysis considers six important external factors that may affect your company, you'll often encounter many other factors that the analysis won't take into account, most notably internal factors and your competition.

When you are trying to decide if an idea for your business is feasible, you should examine all the factors that can affect its success or failure. The analysis can be applied to a range of large and small projects to identify factors may that affect success. The process gives decision-makers a better awareness and understanding of the changes that may occur and the impact that these changes may have on their business. Using both methods together produces a comprehensive evaluation of a project. They can be applied to large projects as well as smaller ones such as marketing campaigns, reorganizations, new production methods and introductions of new products. The analysis process brings together the views employees and results in a better understanding, acceptance and successful implementation of projects.


PESTLE analysis increases awareness in case of new developments. It raises awareness about potential threats in an external operating.


Accounting Rate of Return – Evaluating Two Mutually Exclusive Projects – PDF

The tool allows the assessing of the current environment and potential changes. The idea is, if the project is better placed than its competitors, it would be able to respond to changes more effectively. The PESTLE Analysis tool can be used for business planning , strategic planning, marketing planning , product development, and organizational planning. These factors are better explained in the next section. Political : Every project has both internal politics and external politics.

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To maximize the benefit of the PESTLE Analysis it should be used on a regular basis within an organization to enable the identification of any trends. The impact of a certain external factor may have more severe consequences for a particular division or department and the PESTLE technique can help clarify why change is needed and identify potential options. As with all techniques there are advantages and disadvantages to using it to help plan organizational strategy.

As a business leader, you understand the importance of staying ahead of the curve. But changes outside your control are constantly influencing your business. The PEST analysis helps entrepreneurs discover what factors could impact their business and develop strategies to handle those changes.

PESTLE analysis

3 comments

  • Duarte F. 20.11.2020 at 13:58

    It is that framework or tool with the help of which a company analyze the external forces which can have an impact on the company which in turn will help a company to be prepared for any shock as well as an opportunity which these 6 factors provide.

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  • Courtney S. 27.11.2020 at 05:07

    Work in the 21st century 5th edition pdf patterns for college writing 14th edition pdf free

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  • Alfie H. 28.11.2020 at 06:46

    Before diving into it, it's best you understand the disadvantages of PESTLE This Twitter SWOT analysis explores the social media giant's strengths along with​.

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