Discover what PESTLE Analysis is? Its Uses, and Applications

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Pestle Analysis
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Discover What PESTLE Analysis is?

Knowledge – Strategy – Organizational


Discover what PESTLE Analysis is?

Explore the meanings of PESTLE Analysis, its uses, and applications. We will also discuss the examples and templates to demonstrate the internal as well as external effects on your company.


A PESTLE Analysis is a simple study that discusses the key external factors such as legal, technological, social, economic, political, and environmental. These factors influence every business, organization, or company. It can be applied in a wide range of situations. It guides the individuals and groups of professionals to manage the strategic decision-making options.

What is PESTLE Analysis?

It is a comprehensive fact-finding facility around different external factors. It focuses on six fundamental factors influencing a business. These factors can affect a company or organization’s decisions while supporting it to improve the opportunities and reduce the risks.

  1. Political: It deals with political stability, tariffs, reforms, trade limitations, environmental laws & regulations and tax policy.
  1. Economic: This factor provides information about interest, wage rates, inflation, economic improvement, recessions, minimum wages, unemployment, credit options, living costs and working hours (locals and regional).
  1. Sociological: This section offers detailed information about the population growth rates, career attitudes, health consciousness, health & safety, cultural norms and age distribution.
  1. Technological: Several new technologies are coming every day. These emerging technologies, such as artificial intelligence and robotics are changing the entire scenario. The rate of technological change is high. This can affect a business, service or product.  
  1. Legal: Businesses (local or international) have to follow certain rules and regulations. These corporate or commercial laws are very important for a company’s survival. This factor also discusses the points about access to materials, legislation affecting the business or employment, resources, labor laws, import/export laws, taxations and other duties.
  1. Environmental: The main theme of PESTLE Analysis is to focus on environmental factors affecting a business. Global warming is increasing, and developed nations take serious steps to introduce sustainable ways. We must focus on ethical sourcing, natural emergencies, pandemics, supply chain systems and intelligence.

Companies can find the potential risks associated with their organizations and businesses by studying these factors. They can also make updated systems for corporate success. It can also highlight the main factors such as research & development, additional costs, and future applications.


How can I do PESTLE Analysis?

Doing PESTLE Analysis requires information about the above-mentioned key factors. Once you collect this information, follow the given steps.

  1. Recognizing the scope of business research must cover the past, present, and future situations. Moreover, implement the local and industrial choices that suit the business functions.
  1. Decide who will collect this information and what options will be used. Also, recognize multiple individuals to collect the information to have a multi-perspective scenario.
  1. Find the suitable information sources – One may choose areas of PESTLE Analysis to focus on the industry while others may explore the knowledge about key analysis factors. Always keep external factors such as environment and political situations in mind.
  1. Collect information and data – One may utilize corporate PESTLE Analysis templates and examples for this purpose.
  1. Analyze all the findings and observations using the standard methods.
  1. Consider each item or factor important. Don’t ignore the threats and risks to the business.
  1. Identify your options to solve the business issues.
  2. Write discussions when communicating with the partners and stakeholders.
  1. Discuss and disseminate the observations, findings, and outcomes with all the partners and decision-makers.
  1. Take actions swiftly according to the trends and monitor the situation closely.

In order to be successful, PESTLE Analysis must be performed consistently. This supports the companies and businesses to identify the early trends and offers a competitive edge.

You can find and download the templates of PESTLE Analysis here. We have created some examples based on fictitious and genuine organizations that will support you done PESTLE Analysis. We also have templates for analysis and interpretation.

Tips for PESTLE Analysis:

Some practical and easy PESTLE Analysis suggestions are given here.

  1. Collaborate – Various perspectives can detect more threats.
  1. Utilize resources and right expertise such as Porter’s Five Forces and SWOT Analysis. You can also include scenario planning and competitor analysis.
  1. Utilize PESTLE Analysis in combination with other techniques and ongoing processes. Moreover, monitor the business environment and trends for effective decisions.
  1. Never collect a wide variety of information that has nothing to do with the understanding and analysis. Moreover, avoid using any steps without proper grip and assessment.
  1. Never jump to future trends without comparing the past and present aspects.


What are the uses of PESTLE Analysis?

The PESTLE Analysis can easily demonstrate and understand the long-term business trends by analyzing external factors such as the environment. It can help a wide range of corporate planning situations. For example,

Strategic Business Planning: The PESTLE Analysis offers contextual knowledge about corporate direction, growth rates, targets, understanding the brand, and risks to performance. Moreover, it can support identifying the validity of current services and products and explain a new brand development.

Workforce planning: It assists in recognizing the disruptive changes to business models that may profoundly influence the plans and employment landscape. It also identifies new job roles, skill gaps, job displacement, and reduction.

Marketing Planning: The PESTLE Analysis always provides the latest situations and an understanding of the market trends. Thus, the analysis stage of marketing planning helps to prioritize the corporate activities to achieve the special marketing goals within a decided timeframe.

Product Development: By analyzing and monitoring the external factors, it supports to warn whether to leave or enter the market. It also provides technical knowledge about the fate of a service or product, whether it will succeed or fail in the market. You can also find the right time to launch a new service or product.

Organizational change: It is the best option to analyze the context for change. It is more influential when combined with SWOT Analysis to identify new opportunities and risks related to the skills shortage, labor charges, and workforce potentials.

People projects, reports, and strategies – It can be utilized as a system to look outside the company to create a hypothesis about the present and future options. It ensures that some fundamental factors are not being missed or overrated when joining people policies to a broader business strategy.

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Pros and cons of PESTLE Analysis:


  1. It is a simple procedure.
  2. It assists in understanding the business trends and environments.
  3. PESTLE Analysis supports strategic thinking and external planning.
  4. It enables the company to predict future corporate risks and take steps to minimize the impact or altogether avoid it.
  5. It allows the business to identify the main opportunities and how to exploit them completely.

Disadvantages of PESTLE Analysis:

  1. Some users oversimplify the information and data utilized for decision-making. It is simple to use inefficient data.
  2. The threat of picking too much information always ruins or paralyzes the analysis.
  3. The information utilized may depend on assumptions.
  4. The speed of technological changes creates more problems to predict product development. It may affect the company in the future.
  5. To be more efficient, the method should be repeated again and again consistently.

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