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This is actually a term derived from PESTLE anaylsis.. P for Political, E for Economic, S for Social, T for Technological, L for Legal and E for Environmental. It gives a bird’s eye view of the whole environment from many different angles that one wants to check and keep a track of while contemplating on a certain idea/plan
PEST analysis is concerned with the key external environmental influences on a business.
The acronym stands for the Political, Economic, Social and Technological issues that could affect the strategic development of a business.
Identifying PEST influences is a useful way of summarising the external environment in which a business operates. However, it must be followed up by consideration of how a business should respond to these influences.
The table below lists some possible factors that could indicate important environmental influences for a business under the PEST headings:
Political / Legal Economic Social Technological Environmental regulation and protection Economic growth (overall; by industry sector) Income distribution (change in distribution of disposable income; Government spending on research Taxation (corporate; consumer) Monetary policy (interest rates) Demographics (age structure of the population; gender; family size and composition; changing nature of occupations) Government and industry focus on technological effort International trade regulation Government spending (overall level; specific spending priorities) Labour / social mobility New discoveries and development Consumer protection Policy towards unemployment (minimum wage, unemployment benefits, grants) Lifestyle changes (e.g. Home working, single households) Speed of technology transfer Employment law Taxation (impact on consumer disposable income, incentives to invest in capital equipment, corporation tax rates) Attitudes to work and leisure Rates of technological obsolescence Government organisation / attitude Exchange rates (effects on demand by overseas customers; effect on cost of imported components) Education Energy use and costs Competition regulation Inflation (effect on costs and selling prices) Fashions and fads Changes in material sciences Stage of the business cycle (effect on short-term business performance) Health & welfare Impact of changes in Information technology Economic "mood" - consumer confidence Living conditions (housing, amenities, pollution) Internet!
Political, Economical, Social, Technological
