SWOT and PESTEL Analyses

The SWOT analysis is perhaps the most basic tool in the business-person's box. An acronym for “Strengths, Weaknesses, Opportunities, and Threats,” this planning template asks the user to detail these areas for a given project (new or on-going), be it a business plan, a new human resources program, or a particular advertising approach. The word basic should not fool users, however; the SWOT analysis can be an incredibly powerful tool when used correctly.

The key, of course, is correct use. A superficial filling-out of the SWOT form will yield little to no useful results. Rather, users (students and seasoned professionals alike) need to go in-depth to investigate all four aspects of the given project, see what hidden strengths and weaknesses exist, take a creative approach to the opportunities category, and really think about what threats could be lurking. Once the form is filled out, the student (or professional) needs to use the information it contains, apply it to the strategic planning process.

The PESTEL analysis takes the SWOT one step further and examines the various external bodies that act upon the particular project (i.e. the opportunities and threats). There are many versions of this particular acronym (PEST, PESTLE, PESTEL, etc.), but the letters are the same regardless of the version: Political, Economic, Social, Technological, Environmental, and Legal. And so, for example, the student who is working to identify potential threats to a business based in Columbia would look closely at the political, economic, social, and environmental aspects of everything from the current political situation to the drug wars there. She could also use the PESTEL to examine the opportunities that exist in Columbia, including any technological innovations, social movements, and so forth.

Again, though, a surface-level PESTEL will not do. Anyone can fill in one or two categories of this chart; it takes a savvy thinker, someone who is willing and able to think outside the box, to really make maximum use of these categories.

This is why business, finance, human resources, and marketing students are all asked to perform almost countless SWOT and PESTEL analyses. These tools are not only ubiquitous in the general world of business, but they can also be incredibly powerful. To be powerful, though, they must be used correctly, which can happen with practice over the course of many case study examinations.

However, it can be quite difficult to learn how to correctly use the SWOT and PESTEL analyses if one does not have anything from which to work. Sadly, many textbooks are lacking in concrete, helpful examples. Contact a professional academic writer today, one who specializes in business-related strategic planning tools and templates, to get the model project you need.