Market
PESTEL
Last reviewedWhat is PESTEL?
A checklist of outside factors: political, economic, social, technological, environmental and legal.
When should you use PESTEL?
Market studies, entry into a new country, and long-term strategy, to spot trends and risks outside the industry.
What are its limits?
It is easy to produce a long, unranked list. It does not say which factors matter or by how much.
How do you tailor it to a case?
Keep only the two or three factors that change the decision, and say how each affects demand, cost or risk.
Where does it come from?
Grew out of Francis Aguilar's environmental scanning work, Scanning the Business Environment (1967).
Use a framework as a source of ideas, then put a structure built for this specific problem on the table. Reciting a framework by name is a common way to lose marks.