If done correctly, PESTLE Analysis can become your greatest ally. If you follow our guide below, doing your PESTLE analysis will be an easy process. We’ve developed a simple three-step guide that you can follow to create meaningful analyses and reports, no matter your industry.
1. Learn Your Categories
The PESTLE Analysis contains six categories of business that are important to your success.
Political
Everything and everyone is affected by national and international politics, businesses included. For businesses that take their activities internationally, this is even more relevant. Political aspects that affect your business include taxation policies, general legislation, trade tariffs, and many others.
Economic
Global and local economies play a vital role in our day-to-day lives and businesses. Delving into the economic factors of PESTLE Analysis reviews the implications of economics on your business. Economic aspects refer to Gross Domestic Product, inflation, and exchange rates.
Sociocultural
Sociocultural factors address the societal issues and cultural aspects of a place that might influence your business activity in one way or another. These factors include age demographics, ethnicities, and cultural differences.
Technological
Technology has become essential to our personal and business lives. Naturally, it is part of PESTLE analysis as well. Technological aspects refer to the progress of technologies, including mobile phones, access to the internet, cybersecurity, etc., and the impact those have on your business.
Legal
When it comes to legal aspects, they tend to overlap with the political ones in PESTLE analysis. The legal factor refers to the regulations your organization needs to follow, like copyright laws, industry-specific regulations, import/export laws, etc.
Environmental
Environmental factors are becoming more relevant. The depletion of natural sources, increases in pollution, and the looming climate crisis will impact your business operations.
2. Do the Research
After familiarizing yourself with the six PESTLE categories, it is time to move on to the next step. Beginners to business analysis may find this difficult and need to learn the basics before completing a PESTLE Analysis.
When doing your PESTLE analysis, two significant pieces you must consider are what information to include and where to find it.
What Information You Should Include
The six categories we mentioned above that go into a PESTLE analysis hint at what kind of information to use in your work. There aren’t any special rules regarding which aspects to include.
It’s up to you to choose the information that is suitable for your business. The purpose is to draft a plan based on each category’s relevance to your business activity. Once you are clear about which categories are most relevant, you can invest your time and effort into researching information specific to those categories.
A good PESTLE Analysis is the result of a good understanding of one’s organization. Learn as much as you can about your business to make the PESTLE Analysis more relevant to your business goals.
Where to Find the Right Information
It can be tough to find out where to collect your data from when it comes to the six factors of PESTLE analysis. The internet is a good source. You can search for information regarding tax laws or regulations for doing business in a particular foreign country.
Besides the internet, there are other excellent sources for gathering your information. You can read government reports, which come with reliable data on topics you need for your analysis. Additional sources are third-party reports created by specialized companies. These may require payment to access.
3. Gather It All in One Place
Once you have all the information you need, it’s time to put everything together. There’s no right or wrong way of doing this. Here are some suggestions on how to make your PESTLE analysis.
- Create six distinct sections for your analysis.
- Don’t forget about adding an introduction and a conclusion. Write a short and simple introduction that explains the purpose and goal of your PESTLE analysis. Finish your analysis by stating, in conclusion, the meaning of your findings.
You now have the basics of performing a PESTLE analysis. Just follow this guide, and your business will be on the right track in no time.
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