The PESTEL analysis is an important strategic analysis tool, in which the effects of external influencing factors on the own enterprise are evaluated. Ideally, this environment analysis is carried out regularly in order to detect changes in the influencing factors in good time. A free template of the Macro-Environmental Analysis can be downloaded below.
The PESTEL Analysis
PESTEL stands for the initial letters of the influencing factors. These are: political, economical, socio-cultural (social), technological, ecological and legal.
Often we speak of STEEP, STEEP analysis, STEP analysis or PEST analysis. This is the same form of analysis as the PESTEL, but some aspects (e.g. legal and ecological in the PEST analysis) are not considered.
1. Political influencing factors
Political factors play an important role for the management of a company when it comes to location decisions or the choice of a sales market. Governments use this opportunity to pursue active economic policies and give preference to their own companies.This applies not only to authoritarian states, but also to democratic countries and country alliances such as the European Union. On the one hand through local subsidies and promotions, on the other hand through punitive tariffs and import bans. These can also serve as an incentive to invest in the country or to enter into a joint venture.Some specific examples of political influencing factors:Offering external services for the Brazilian marketForeign companies must pay a 100% (penalty) duty if they provide the service abroad. As a result, companies enter into a partnership with local providers in Brazil.Solar modules from China for the European marketIn order to protect European manufacturers, the EU imposed a penalty duty on Chinese solar modules.Among the political influencing factors are therefore for example ....
2. Economical influencing factors
For export-intensive countries and industries, economic factors such as exchange rates are of enormous importance. A strong local currency means higher prices in other sales markets and a competitive disadvantage.On the other hand, high economic growth and a rising level of education indicate a growing market and increased sales opportunities.Economic factors include, for example, ....
3. Socio-cultural influencing factors
The aim of these influencing factors is to determine which special social and cultural peculiarities exist. This also includes changing purchasing behaviour and generally changing lifestyles.The socio-cultural influencing factors include for example ....
4. Technological influencing factors
The current core topic among the technological influencing factors is digitization. This causes existing value-added chains to be disrupted and decades-long processes to be called into question.Example of a technological influencing factor: Spare part production using 3D printing processesIn the past, machines stood idle until the required spare parts were requested and finally delivered to the factory. Nowadays the spare parts are available as a plan and can be produced cost-effectively and efficiently on site with a 3D printer. This saves a lot of time and money.The technological influencing factors of the PESTEL analysis include for example ....
5. Ecological influencing factors
Ecological influencing factors include, for example, environmental regulations that can have a strong influence on a company's investment plans. Noise-, air- or water-specific requirements can vary greatly from country to country.Other ecological influencing factors are ...
6. Legal influencing factors
Legal influencing factors include, for example, antitrust regulations to prevent companies from assuming a monopoly character in the market. The concrete form of what is still permissible and what does not differ from country to country.Further legal influencing factors are ...
Further applications of the PESTEL analysis
The Pestel analysis offers valuable assistance in the evaluation of external opportunities and risks, which are an essential part of the SWOT analysis. The PESTEL analysis is also used as a preparatory step in scenario analysis. The relevant but uncertain factors for the company and the associated risks are taken into account.
In our project work we use either the described PESTEL analysis or the MARKET MAP developed by ACRASIO, depending on the project content. This is an addidtion to the well-known Business Model Canvas, which does not include the market and competitive perspective.