PEST Analysis Guide

The comprehensive guide to the PEST business

analysis method

In the following guide we will introduce you to the PEST business analysis method and
to its various.

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PEST Analysis Guide
Copyright AKS-Labs


Business Analysis Methods
Guide


Introduction to the method and problem of PEST

PEST analysis is the consideration of the political, economic, social, and
technological changes to evolve a macro
implement strategic management. PEST is an effective tool to estimate
market direction, business potential, present st
future operations.

What is PEST?

PEST is the process of scanning the external macro
consists of the following external environments that impact the operations of the business.

Political
Economic
Social
Technological


PEST is also termed as STEP by certain management experts. Others add legal factors and call it as
SLEPT, while a few include environmental factors to create the terminologies of PESTEL or PESTLE.
Even educational and demog
STEEPLE and STEEPLED. PEST forms the framework for analyzing the macro
that have a direct bearing on the functioning of the business entity. The overall environmental
scan of the business includes PEST to analyze macro
and solves the following problems encountered by business entities.

What problems PEST addresses and can solve?
Political
Economic
Social
Technological
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Introduction to the method and problem of PEST
analysis is the consideration of the political, economic, social, and
technological changes to evolve a macro-environmental framework to
implement strategic management. PEST is an effective tool to estimate
market direction, business potential, present status, and direction for
PEST is the process of scanning the external macro-environment of the business entity and it
consists of the following external environments that impact the operations of the business.
PEST is also termed as STEP by certain management experts. Others add legal factors and call it as
SLEPT, while a few include environmental factors to create the terminologies of PESTEL or PESTLE.
Even educational and demographic factors had been added as factors to extend the analysis to
STEEPLE and STEEPLED. PEST forms the framework for analyzing the macro
that have a direct bearing on the functioning of the business entity. The overall environmental
scan of the business includes PEST to analyze macro-environment. A good PEST analysis addresses
and solves the following problems encountered by business entities.
What problems PEST addresses and can solve?
Political
Economic
Social
Technological
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analysis is the consideration of the political, economic, social, and
environmental framework to
implement strategic management. PEST is an effective tool to estimate
atus, and direction for
environment of the business entity and it
consists of the following external environments that impact the operations of the business.

PEST is also termed as STEP by certain management experts. Others add legal factors and call it as
SLEPT, while a few include environmental factors to create the terminologies of PESTEL or PESTLE.
raphic factors had been added as factors to extend the analysis to
STEEPLE and STEEPLED. PEST forms the framework for analyzing the macro-environmental factors
that have a direct bearing on the functioning of the business entity. The overall environmental
environment. A good PEST analysis addresses

PEST Analysis Guide
Copyright AKS-Labs


Business Analysis Methods
Guide


Political Factors

Political factors that influence a business consist of various governmental regulations, taking into
consideration the formal and informal rules to which the business must conform. These factors are
tax policies, employment laws, trade restrictions, tariffs, political stability,
regulations. The level of interference by the government in the business defines the political
factors. The government might encourage the production of certain goods or services, while
restricting or prohibiting specific types of goods

Economic Factors

Economic factors are determined by the issues that impact the purchasing power of prospective
customers and the cost of capital of the business. Economic factors such as growth rate of the
economy, interest rates, inflation
society. These factors play a crucial role in the operation and decisions of the business. Interest
rates have a direct impact on the cost of the capital of the business and influence the growt
expansion of the business. Inflation rates decide the capacity of potential customers to buy goods
and services. Exchange rates have a bearing on the cost of export of goods and cost of import of
goods. The overall economic growth of the country is t
of production.

Social Factors

Social factors comprise of the cultural aspects of the external macro
have an effect on the needs of the customers and the size and extent of potential mar
business. The major social factors are growth rate of the population, age distribution, career
attitudes, health consciousness, and safety concerns. If the population consists of people with
higher age levels, the cost of labor is likely to in
benefit from employing older workers at lower rates and reduce labor costs. As such, handling
social factors is a major step in the success of the business.

Technology Factors

Technology factors reduce barri
limitations, and influence decisions on outsourcing. The technological factors include research and
development activities, automation processes, incentives for technology innovations, and rate
change in technology. Technological changes affect quality and costs, resulting in further
innovations.

Who are stake holders - who benefit from PEST?

In any PEST analysis, all the stakeholders related to the business directly or indirectly either
benefit or suffer from the use of PEST or lack of it. The most important stakeholders are the
shareholders, the directors, the senior management, the employees, the customers, the vendors
and suppliers, the government agencies, and the regulatory bodies.

AKS-Labs 2501 Blue Ridge Road
Suite 150 Raleigh NC 27607
influence a business consist of various governmental regulations, taking into
consideration the formal and informal rules to which the business must conform. These factors are
tax policies, employment laws, trade restrictions, tariffs, political stability,
regulations. The level of interference by the government in the business defines the political
factors. The government might encourage the production of certain goods or services, while
restricting or prohibiting specific types of goods and services.
Economic factors are determined by the issues that impact the purchasing power of prospective
customers and the cost of capital of the business. Economic factors such as growth rate of the
economy, interest rates, inflation rates, and exchange rates influence the purchase power of the
society. These factors play a crucial role in the operation and decisions of the business. Interest
rates have a direct impact on the cost of the capital of the business and influence the growt
expansion of the business. Inflation rates decide the capacity of potential customers to buy goods
and services. Exchange rates have a bearing on the cost of export of goods and cost of import of
goods. The overall economic growth of the country is the parameter for expansion or contraction
Social factors comprise of the cultural aspects of the external macro-
have an effect on the needs of the customers and the size and extent of potential mar
business. The major social factors are growth rate of the population, age distribution, career
attitudes, health consciousness, and safety concerns. If the population consists of people with
higher age levels, the cost of labor is likely to increase. At the same time, companies might also
benefit from employing older workers at lower rates and reduce labor costs. As such, handling
social factors is a major step in the success of the business.
Technology factors reduce barriers of entry into markets, reduce production level efficiency
limitations, and influence decisions on outsourcing. The technological factors include research and
development activities, automation processes, incentives for technology innovations, and rate
change in technology. Technological changes affect quality and costs, resulting in further
who benefit from PEST?
In any PEST analysis, all the stakeholders related to the business directly or indirectly either
efit or suffer from the use of PEST or lack of it. The most important stakeholders are the
shareholders, the directors, the senior management, the employees, the customers, the vendors
and suppliers, the government agencies, and the regulatory bodies.

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influence a business consist of various governmental regulations, taking into
consideration the formal and informal rules to which the business must conform. These factors are
tax policies, employment laws, trade restrictions, tariffs, political stability, and environmental
regulations. The level of interference by the government in the business defines the political
factors. The government might encourage the production of certain goods or services, while
Economic factors are determined by the issues that impact the purchasing power of prospective
customers and the cost of capital of the business. Economic factors such as growth rate of the
rates, and exchange rates influence the purchase power of the
society. These factors play a crucial role in the operation and decisions of the business. Interest
rates have a direct impact on the cost of the capital of the business and influence the growth and
expansion of the business. Inflation rates decide the capacity of potential customers to buy goods
and services. Exchange rates have a bearing on the cost of export of goods and cost of import of
he parameter for expansion or contraction
-environment. These factors
have an effect on the needs of the customers and the size and extent of potential markets for the
business. The major social factors are growth rate of the population, age distribution, career
attitudes, health consciousness, and safety concerns. If the population consists of people with
crease. At the same time, companies might also
benefit from employing older workers at lower rates and reduce labor costs. As such, handling
ers of entry into markets, reduce production level efficiency
limitations, and influence decisions on outsourcing. The technological factors include research and
development activities, automation processes, incentives for technology innovations, and rate of
change in technology. Technological changes affect quality and costs, resulting in further
In any PEST analysis, all the stakeholders related to the business directly or indirectly either
efit or suffer from the use of PEST or lack of it. The most important stakeholders are the
shareholders, the directors, the senior management, the employees, the customers, the vendors

PEST Analysis Guide
Copyright AKS-Labs


Business Analysis Methods
Guide

When a business entity uses PEST
share and revenues. It is able to protect itself from changes in political, economic, social, and
technological spheres and proceed on a growth path. This benefits all the stakeholders involved
with the business. On the other hand, when an organization fails to use PEST analysis properly,
then it impacts not only the company but all its stakeholders adversely with serious consequences.

Who in the business use PEST to improve business?

Even though all the abovementioned stakeholders are impacted by PEST, it is the top management
that uses PEST analysis to improve business, anticipate changes, and formulate policies to
overcome possible hurdles. When the management implements PEST in the correct m
company and its stakeholders benefit equally. In particular, consumer
enterprises and business-to
On the other hand, global business organizations encounter a
changes in political factors. Companies that depend on external funding for running the business
are seriously affected by economic factors like rise in interest rates, tariffs, etc. The actual use of
PEST improve business varies widely from one company to another. The large organizations of
present times apply PEST analysis to each department or division on an individual basis for better
effects and results.

Vendors and
Government
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When a business entity uses PEST analysis in the most effective manner, it expands its market
share and revenues. It is able to protect itself from changes in political, economic, social, and
technological spheres and proceed on a growth path. This benefits all the stakeholders involved
with the business. On the other hand, when an organization fails to use PEST analysis properly,
then it impacts not only the company but all its stakeholders adversely with serious consequences.
Who in the business use PEST to improve business?
gh all the abovementioned stakeholders are impacted by PEST, it is the top management
that uses PEST analysis to improve business, anticipate changes, and formulate policies to
overcome possible hurdles. When the management implements PEST in the correct m
company and its stakeholders benefit equally. In particular, consumer
to-business (B2B) organizations are impacted heavily by social factors.
On the other hand, global business organizations encounter advantages or difficulties due to
changes in political factors. Companies that depend on external funding for running the business
are seriously affected by economic factors like rise in interest rates, tariffs, etc. The actual use of
varies widely from one company to another. The large organizations of
present times apply PEST analysis to each department or division on an individual basis for better

Directors
Shareholders
Senior
Management
Employees Customers
Vendors and
Suppliers
Government
Agencies
Regulatory
Bodies
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analysis in the most effective manner, it expands its market
share and revenues. It is able to protect itself from changes in political, economic, social, and
technological spheres and proceed on a growth path. This benefits all the stakeholders involved
with the business. On the other hand, when an organization fails to use PEST analysis properly,
then it impacts not only the company but all its stakeholders adversely with serious consequences.
gh all the abovementioned stakeholders are impacted by PEST, it is the top management
that uses PEST analysis to improve business, anticipate changes, and formulate policies to
overcome possible hurdles. When the management implements PEST in the correct manner, the
company and its stakeholders benefit equally. In particular, consumer-oriented business
business (B2B) organizations are impacted heavily by social factors.
dvantages or difficulties due to
changes in political factors. Companies that depend on external funding for running the business
are seriously affected by economic factors like rise in interest rates, tariffs, etc. The actual use of
varies widely from one company to another. The large organizations of
present times apply PEST analysis to each department or division on an individual basis for better
Shareholders
Senior
Management

PEST Analysis Guide
Copyright AKS-Labs


Business Analysis Methods
Guide

More in the full version of
Methods Guide
29 page SWOT guide

Alternative methods to SWOT analysis
Steps in solving problems using Porters Five Forces for Competitive Position
Solving problems using the SWOT analysis
Result
SWOT analysis: conclusions
SWOT FAQ
SWOT checklist
21 PowerPoint templates
presentation
32 page PEST Analysis
Introduction to the method and problem of PEST
PEST and SWOT
PEST and its extensions
Step-by-step guide on how to use PEST for solving business problems
Key success factors of PEST
Examples of real-life usage of PEST
Conclusions
PEST FAQ
Checklist for PEST
Other aspects related to PEST
Review of the most popular
The review includes introduction to the method, step
practices.
80/20 Pareto Analysis
Break-even Analysis
Competitive Analysis
Key Ratio Analysis
PEST Analysis (3 page)
SWOT Analysis (4 page)
Variance analysis (4 page)
"What if..." simulation (4 page)
Learn more online: http://www.measurebusiness.com/

AKS-Labs 2501 Blue Ridge Road
Suite 150 Raleigh NC 27607
More in the full version of the Business Analysis
Methods Guide:
SWOT guide (Adobe PDF file):
Alternative methods to SWOT analysis
Steps in solving problems using Porters Five Forces for Competitive Position
Solving problems using the SWOT analysis - 5 examples in format: Problem, Response with SWOT,
SWOT analysis: conclusions
templates (.pptx file; check examples below) for SWOT analysis
PEST Analysis Guide (Adobe PDF file)
Introduction to the method and problem of PEST
PEST and its extensions
step guide on how to use PEST for solving business problems
Key success factors of PEST
life usage of PEST

Other aspects related to PEST
Review of the most popular business analysis methods
The review includes introduction to the method, step-by-step algorithms, pros and cons, best
80/20 Pareto Analysis (4 page)
even Analysis (4 page)
Competitive Analysis (4 page)
(3 page)
(3 page)
(4 page)
(4 page)
"What if..." simulation (4 page)
http://www.measurebusiness.com/
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Business Analysis
Steps in solving problems using Porters Five Forces for Competitive Position
5 examples in format: Problem, Response with SWOT,
(.pptx file; check examples below) for SWOT analysis
step guide on how to use PEST for solving business problems
business analysis methods
step algorithms, pros and cons, best