Running head: CREATING A STRATEGIC BUSINESS PLAN
TutorsIndia/Resources/Assignment/StrategicManagement/Tools
Creating a Strategic Business Plan using PESTLE Analysis
1
CREATING A STRATEGIC BUSINESS PLAN
2
1.0 Introduction
A key management approach that is effectively being used within most modern
organizations is Strategic Planning. It has continuously enjoyed top rankings amongst five of
the most popular approaches that have been adopted by managements across the globe [1],
[2]. Typically, it has been considered as an approach adopted to formulate strategy, strategic
planning comprises of components such as; a) evaluation of the mandate of the organization,
values and mission, b) analyzing an organization’s internal and external environment, and c)
identifying strategic issues on the basis of such analysis and developing strategies, plans and
goals to tackle any issues [3].
When an organization is keen to realize a preset goal, it is expected to formulate an
effective strategy to achieve it. The strategy has to be such that it establishes priorities, fixes a
time duration, allocates resources, formulate mechanisms for control, allocate human
resources and it also needs to comprise of guidelines as to the manner in which every aspect
will be tackled to realize a particular goal in the most appropriate manner. Though the
organization might be very reputed, would be having a skilled and committed team, the
question here would be whether any strategies formulated might be of use or not? It’s quite
simple, all the organization needs to do is conduct a PESTLE analysis [4].
2.0 Conducting a PESTLE Analysis
For those who are clueless, a PESTLE analysis essentially would refer to executing an
audit of an organization’s environment which facilitates the process of planning and helps in
arriving at strategic decisions. It is understood that in case an organization is in a position to
audit their present environment and evaluate probable changes, they will be in a better
position than their competitors to respond to changes [5]. The analysis would generally
determine the most probable events that might have an impact on the organization. Each of
CREATING A STRATEGIC BUSINESS PLAN
3
the factors from PESTLE – Political, Economic, Social, Technological, Legal, Environment
would have an impact on the business plan [6].
2.1 Political
This factor would present the manner and level to which the political environment of
a region would impact the economy and some organization. This might be at the local, state
or national level. Existing considerations within the market that might influence the
organization would comprise of factors such as; probable change in government, instability in
the government owing to the balance of power, altering policies of business and
superannuation, laws pertaining to tax, labour related laws and trade limitations.
2.2 Economic
This factor would pertain to aspects that are distinct to the economy and have a direct
impact on the organization. Factors that could influence the strategic plan of an organization
would comprise of rate of interest, rate of exchange, rate of inflation, prices of property and
economic growth as well. Economic aspects would also refer to economic factors of the
organization’s geographic area.
2.3 Social
This factor essentially comprises of demographic factors which would be inclusive of
rate of growth of population, gender and age distribution of population, cultural facets and
changes in social behaviours. For instance; lately social media is being extensively utilized to
discuss about products and services. Several of these aspects might make an impact on the
manner in which organizations conduct their businesses with their customers and the
techniques used for interacting with them.
2.4 Technological
The technological factor would refer to the rapid changes that occur in the domain of
technology, technological research and development initiatives and automation. Such factors
CREATING A STRATEGIC BUSINESS PLAN
4
are instrumental in driving decisions for outsourcing, efficiency and quality considerations.
For example; use of smart phones, artificial intelligence, emergence of location based
searching, skype meetings or mobile internet for that matter. Over the period of the past three
decades, the massive changes that have occurred in the domain of technology has hugely
impacted all industry sectors and the speed and level that this will occur only stands to show
an upward trend.
2.5 Legal
Legal factors would pertain to every law that is directly linked with the organization
and their domain of activity. For instance; laws on privacy, consumer protection laws,
employment laws and laws against discrimination could certainly influence some aspects of
an organization.
[Note: Get the best LLM international law thesis writing online help].
CREATING A STRATEGIC BUSINESS PLAN
5
Read blog: Titles for International Public and Private Law in Dissertation
2.6 Environmental
The environmental factor draws reference to every factor that is directly linked with,
determined or influenced on the basis of the natural environment where the organization is
located. This would comprise of weather and natural disasters, climate changes, geographical
position and sustainability. For instance; if the location where the organization is situated is
subject to extreme weather conditions, it would definitely make a negative impact on the
organization.
3.0 Conclusion
All the above said factors are intricately associated with the business and it would do
well for an organization to carry out an PESTLE analysis. The analysis will help them to
understand their external environment and then they can formulate strategies to tackle them
while creating their strategic plan.
Tutors India Uk is the #1 Academic Writing Assistance Brand in offering
any Business, Management and Marketing research paper or any types of
content which offers the core research.
References
[1]
Darrell Rigby and Barbara Bilodeau, “Management Tools & Trends,” 2018. [Online].
Available:
https://www.bain.com/contentassets/f8361c5cd99e4f40bbbf83c17d6a91b9/bain_briefmanagement_tools_and_trends.pdf.
CREATING A STRATEGIC BUSINESS PLAN
[2]
6
C. Wolf and S. W. Floyd, “Strategic Planning Research: Toward a Theory-Driven
Agenda,” J. Manage., vol. 43, no. 6, pp. 1754–1788, Jul. 2017, doi:
10.1177/0149206313478185.
[3]
J. M. Bryson, Strategic planning for public and nonprofit organizations: A guide to
strengthening and sustaining organizational achievement. John Wiley & Sons, 2018.
[4]
B. George, R. M. Walker, and J. Monster, “Does Strategic Planning Improve
Organizational Performance? A Meta‐Analysis,” Public Adm. Rev., vol. 79, no. 6, pp.
810–819, Nov. 2019, doi: 10.1111/puar.13104.
[5]
B. George and S. Desmidt, “A state of research on strategic management in the public
sector: An analysis of the empirical evidence,” in Strategic management in public
organizations: European practices and perspectives, Routledge, 2014, pp. 151–172.
[6]
B. Gray, “How to Effectively Conduct a PESTLE & SWOT Analysis,” 2016.
https://www.linkedin.com/pulse/how-conduct-pestle-swot-analysis-byron-gray.