PEST Analysis

Metadata

• Name: pest-analysis
• Description: Political, Economic, Socio-cultural, Technological analysis
• Triggers: PEST, PESTLE, macro environment, external factors, political economic

Instructions

Framework

P - Political Factors

• Political stability
• Government policy and regulations
• Trade restrictions/tariffs
• Tax policy
• Labor laws
• Environmental regulations
• Industry-specific legislation

• How stable is the political environment?
• What policy changes are likely?
• How do trade policies affect us?

E - Economic Factors

• GDP growth trends
• Interest rates
• Inflation rates
• Exchange rates
• Unemployment levels
• Disposable income
• Credit availability
• Economic cycle stage

• What's the economic growth outlook?
• How do interest rates affect our customers?
• What's happening with input costs?

S - Socio-cultural Factors

• Population demographics
• Age distribution
• Lifestyle changes
• Consumer attitudes
• Cultural shifts
• Education levels
• Health consciousness
• Work-life balance trends

• How are consumer preferences changing?
• What demographic shifts matter?
• What cultural trends affect demand?

T - Technological Factors

• Emerging technologies
• R&D activity
• Automation trends
• Digital transformation
• Technology adoption rates
• Intellectual property landscape
• Disruptive innovations
• Infrastructure changes

• What technologies are emerging?
• How is automation changing the industry?
• What innovations might disrupt us?

Extension: PESTLE (+ Legal + Environmental)

• Legal: Specific laws, litigation trends, regulatory enforcement
• Environmental: Climate change, sustainability, environmental regulations

Output Process

1. Brainstorm all potential factors (don't filter yet)
2. Categorize into PEST framework
3. Assess impact - High/Medium/Low
4. Assess probability - High/Medium/Low
5. Prioritize - Focus on high impact + high probability
6. Implications - What does this mean for strategy?

Output Format

## PEST Analysis: [Subject]

### Overview
[Brief context and time horizon]

---

### POLITICAL Factors

| Factor | Impact | Probability | Priority |
|--------|--------|-------------|----------|
| [Factor 1] | H/M/L | H/M/L | ⭐⭐⭐ |
| [Factor 2] | H/M/L | H/M/L | ⭐⭐ |
| [Factor 3] | H/M/L | H/M/L | ⭐ |

**Key Implications:**
- [Implication 1]
- [Implication 2]

### ECONOMIC Factors

| Factor | Impact | Probability | Priority |
|--------|--------|-------------|----------|
| [Factor 1] | H/M/L | H/M/L | ⭐⭐⭐ |
| [Factor 2] | H/M/L | H/M/L | ⭐⭐ |
| [Factor 3] | H/M/L | H/M/L | ⭐ |

**Key Implications:**
- [Implication 1]
- [Implication 2]

### SOCIO-CULTURAL Factors

| Factor | Impact | Probability | Priority |
|--------|--------|-------------|----------|
| [Factor 1] | H/M/L | H/M/L | ⭐⭐⭐ |
| [Factor 2] | H/M/L | H/M/L | ⭐⭐ |
| [Factor 3] | H/M/L | H/M/L | ⭐ |

**Key Implications:**
- [Implication 1]
- [Implication 2]

### TECHNOLOGICAL Factors

| Factor | Impact | Probability | Priority |
|--------|--------|-------------|----------|
| [Factor 1] | H/M/L | H/M/L | ⭐⭐⭐ |
| [Factor 2] | H/M/L | H/M/L | ⭐⭐ |
| [Factor 3] | H/M/L | H/M/L | ⭐ |

**Key Implications:**
- [Implication 1]
- [Implication 2]

---

### Priority Factors (High Impact + High Probability)

1. **[Factor]** - [Implication and recommended action]
2. **[Factor]** - [Implication and recommended action]
3. **[Factor]** - [Implication and recommended action]

### Strategic Recommendations

1. [Recommendation 1]
2. [Recommendation 2]
3. [Recommendation 3]

Tips

• Start broad, then narrow down - brainstorm before filtering
• Apply 80:20 rule - stop when marginal value declines
• Focus on actionable insights, not exhaustive lists
• Time-bound your analysis - specify the planning horizon
• Cross-reference with Porter's Five Forces for industry view
• Update regularly - macro factors change
• Don't spend too long in low-impact quadrants