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Strategic Management - Pestle Analysis

Autor:   •  March 8, 2015  •  Research Paper  •  6,410 Words (26 Pages)  •  635 Views

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Table of Contents


A.        Political        

B.        Economic        

C.        Socio-cultural        

D.        Technological        

E.        Environmental        

F.        Legal        


a.        Threat of Entrants        

b.        Bargaining Power of Suppliers        

c.        Bargaining Power of Buyers        

d.        Intensity of Rivalry        

e.        The threat of substitutes        



The PESTLE Analysis is a tool that is used to identify and analyze the key drivers of change in the strategic or business environment. The abbreviation stands for Political, Economic, Social, Technological, Legal, and Environmental factors. The tool allows the assessing of the current environment and potential changes.

  1. Political

The first factor under PESTEL analysis is political issue. Political factor is referring to stability of a nation’s political environment and the attitudes of political parties or the movements. These are all about how the government will do to intervene the industry.  The degrees that government will intervene for industry are also different for every nation. This can include the government policy with the company, political stability or instability in overseas markets, foreign trade policy, tax policy, labor law, environmental law, trade restrictions and so on.

This factor is totally based on how the government’s rules and regulations or legal issues will affect a company chance to be profitable and successful.  It is because if a company set up the business in a country, they need to think of the policy, law or rules that implemented by the government and this will determine the future of company. For example, if Toyota wants to export cars to Malaysia, they need to consider the tax policy implemented by Malaysia’s government. It is because Malaysia will charges higher tax than other Asia countries that may affect the demand of Toyota’s cars decrease among the Malaysia’s citizen.


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