Pestel analysis: represent your business environment to improve performance

Effective project management requires a good understanding of your environment

Do you want to analyze what factors influence your environment to make sure your company or project is heading in the right direction? A Pestel analysis, which takes its name from the six factors reviewed (political, economic, social, technological, legal and environmental), is just what you're looking for. With the Pestel Analysis template, review these six factors that can influence your organization or project and find the right solutions to minimize or benefit from their impact.

As a team, be it in a face to face or remote meeting, gather all the potential influences, evaluate your environment and identify the actions to be taken. A PESTEL analysis can help you work as a team to mobilize intelligent project management.

What are the advantages of a Pestel analysis?

Like a macro-environmental mapping tool, a Pestel analysis helps you get a clear picture of the ecosystem of your organization or project.

Each external factor has its own issues and specific features. Which is why working as a team to share ideas and knowledge and find solutions will help you to get a complete overview of your ecosystem and thus protect you from any unpleasant surprises, while identifying the various key success factors!

A PESTEL analysis is an easy-to-use tool for brainstorming sessions. You can use it to get a clear understanding of your market and understand the different factors that might affect your project. What's more, by evaluating internal and external factors, a Pestel analysis will help you anticipate potential threats to the company.

A PESTEL analysis can also be used as a framework to encourage the development of long-term strategic thinking and enable everyone involved in project management to create a strategy to anticipate future business threats and opportunities.

How to do a Pestel analysis

Start by inviting your team members to your whiteboard. The six factors are already displayed and color-coded. All you have to do is start the team analysis.

Allow 5 minutes per category and ask participants to contribute their ideas in each box by answering the following questions. Try to find as much information as possible to inform your analysis, for example on the internet, but also by talking to experts or conducting studies.

• For the political factor: Is the political environment stable? What is the state of regional politics? How onerous is the tax burden?
• For the economic factor: Is there inflation? How has household income changed?
• For the socio-cultural factor: What do the demographics look like? Educational attainment?
• For the technological factor: What are the major technology trends, and are they related to your business?
• For the environmental factor: Are there any environmental laws? Does the company express an opinion on the subject?
• For the legal factor: Is there a regulatory framework or new laws related to your business?

You can rearrange ideas in column view to see them more clearly defined by colors.

Start the debriefing using the Question  tool to flesh out ideas or vote as a team, and then ask everyone to like the most appropriate ideas to prioritize them.

Copy the ideas with the most likes into the Let’s go box and ask the team to suggest actions in a different color to place opposite each external factor. Don't forget to collectively assign each action to a person by adding their name.

And there you have it! Your action plan is ready thanks to the team’s Pestel analysis. If you want to fine tune your project management, you can use this outcome to create a SWOT matrix for your project using the Klaxoon template available in the online library.