This document provides an overview of PEST analysis, a framework used to analyze the political, economic, social, and technological factors that may impact a business. It explains that PEST analysis assesses these macroenvironmental factors to determine their influence on long-term business activities and performance. The document then breaks down each PEST factor and provides examples of relevant considerations and questions to ask within political, economic, social, and technological analysis. It concludes by noting PEST analysis can be conducted remotely using online tools to facilitate collaborative input from a distributed team.

1. PEST Analysis

2. PEST
● P: Political Factors
● E: Economic Factors
● S: Social Factors
● T: Technological Factors

3. Why PEST?
● Besides company’s internal resources and industry factors, several other
macro-economic factors can impact on the performance of a company.
● Particularly launching new ventures or product ideas
● These factors determine how big their role is in the organization’s success.
● One of the most commonly used analytical tools for assessing external
macro-economic factors related to a particular situation is PEST Analysis.

4. PEST Analysis Explained
● PEST stands for Political, Economic, Social and Technological.
● This analysis is used to assess these four external factors in relation to
business situation.
● PEST analysis helps determine how these factors will affect the
performance and activities of business in the long-term.
● It is often used in collaboration with SWOT and Porter’s Five Forces to give
a clear understanding of a situation and related internal and external
factors.

5. Pol-ECO
● Political – Here government regulations and legal factors are assessed in
terms of their ability to affect the business environment and trade markets.
● Mainly political stability, tax guidelines, trade regulations, safety
regulations, and employment laws, trade union laws, labour laws are
assessed here.
● Economic – Factors like inflation, interest rates, economic growth, the
unemployment rate and policies, and the business cycle followed in the
country are examined.

6. Soc-Tech
● Social: Business can analyze the socio-economic environment of its
market via elements like customer demographics
● Cultural limitations, lifestyle attitude, and education.
● Business can understand how consumer needs are shaped and what
brings them to the market for a purchase.
● Technological – its positive or negative impacts on the introduction of a
product or service into a marketplace.
● These factors include technological advancements, lifecycle of
technologies, the role of the Internet, and the spending on technology
research by the government.

7. Political
● Government policy, political stability or instability
● Bureaucracy, corruption, competition regulation
● Foreign trade policy, tax policy, trade restrictions,
labor/environmental/copyright/consumer
● Protection laws, funding grants & initiatives, etc.
● Questions to ask:
● What government policies or political groups could be beneficial or
detrimental to our success?
● Is the political environment stable or likely to change?

8. Economic
● Economic trends, growth rates, industry growth, seasonal factors,
international exchange rates, International trade, labor costs, consumer
disposable income, unemployment rates, taxation, inflation, interest rates,
availability of credit, monetary policies, raw material costs, etc.
● Questions to ask:
● What economic factors will affect us moving forward?
How does the performance of the economy affect us at the moment?
● How are our pricing, revenues, and costs impacted by each economic
factor?

9. Social
● Social attitudes, behaviors, and trends that impact on your organization
and target market.
● Attitudes and shared beliefs about a range of factors including money,
customer service, imports, religion, cultural taboos, health, work, leisure,
the environment; population growth and demographics,
immigration/emigration, family size/structure, lifestyle trends, etc.
● Questions to ask
● How do our customer’s beliefs and values influence their buying habits?
● How do cultural trends and human behavior play a role in our business?

10. Technological
● Technology that can affect the way you make, distribute, and market your
products and services.
● Examples include:
● Technology and communications infrastructure, legislation around
technology, consumer access to technology, competitor technology and
development, emerging technologies, automation, research and innovation,
intellectual property regulation, technology incentives, etc.
● Questions to ask:
● What technological advancements and innovations are available or on the
horizon?
● How will this technology impact on our operations?

11. Methods
● For PEST technique, collect information from a large or distributed team
● Getting everyone together at the same time can be difficult, inconvenient,
and costly.
● Use video conferencing, online forms, and collaborative brainstorming
software such as GroupMap.