In contrast to SWOT, PEST is an analytical approach that examines external factors beyond your control.
The idea is to gain insight into how these factors could be affecting present or future sales, brand reputation, and so forth. PEST is an acronym that stands for
Some people and companies use a variation of the PEST analysis called PESTLE, with the additional L and E standing for “legal” and “environmental,” respectively.
Whichever version of the acronym you choose to adopt, the end goal is the same — to identify and assess how relevant external forces could be affecting your company, the better to figure out where you stand in the current climate.
When Should You Use Pest Analysis
A PEST analysis is in order any time you need a clearer picture of how your business actually takes up space in the real world.
It’s also ideal for anticipating how business decisions you’re considering might play out given the current social, political, or economic climate.
PEST won’t help you with the inner workings phone lists of your business in and of itself. It will help you foresee any possible advantages or drawbacks of launching a new project under a given set of conditions.
PEST can help uncover threats you might not have seen any other way.
It can also help you nail down the ideal timing of weighty decisions like product launches, rebranding efforts, and attempts to expand into new demographics.
No analysis method is perfect
Each approach has its unique benefits and disadvantages, and each is best applied to specific situations. That said, neither approach is better than the other.
Which is the right fit for your company depends mainly on your current situation and what you’re looking to find out by conducting analysis in the first place.
Again, PEST is best when you need to develop KH Lists a better understanding of your company’s place in the bigger, ever-changing world out there, especially if you’re planning a significant business decision.
What worked for your business five years ago (or even last year) might not be working nearly as well now for many reasons.
The forces that run the world have changed, and so have your customers’ needs. PEST can help you figure out what changes to make to stay in step with the times and identify the best time to move forward.