The PEST Analysis

Figuring out what you really want is critical.  Once you’ve got that information, though, you have to put it into the context of the external and internal environments in which you’re operating.  A PEST analysis (Political, Environment, Social & Technological Trends) can help you contextualize your plans.

You can find all kinds of worksheets and explanations for PEST Analyses by doing a quick Internet search.  The following provides a list of the factors I consider when conducting a PEST for my business.

The PEST Analysis:

To conduct a Political/Economic/Social/Technological analysis, you’ll examine the environment that you’re working within based on the following criteria:

Political:

• Ecological/Environmental Issues
• Current Legislation within Domestic Market
• Future Legislation within Domestic Market
• Current/Future Legislation within International Market as appropriate
• Regulatory Bodies and Processes
• Tax Policies
• Employment Laws
• Political Stability
• Safety Regulations

Economic:

• Domestic Economy Current Situation
• Domestic Economy Trends
• International Economic Trends
• Market and Trade Cycles
• Inflation Rates
• Consumer Confidence
• Specific Industry Trends

Social

• Lifestyle Trends
• Demographics
• Consumer Attitudes and Opinions
• Media Views
• Branding
• Consumer Buying Patterns
• Population Age & Ethnicity Distribution
• Education

Technological

• Current Technologies
• Technological Trends
• New Inventions
• Changes in How People Use Technology
• Maturity of Current Technologies
• Life cycle of Technology/Technological Obsolescence

As you look at these areas, describe the current state of affairs and try to identify any emerging trends.  Look for opportunities as well as threats.  Examine your goals and figure out how you can use your understanding of the PEST factors to strategize more effectively.