PEST Analysis - framework for analyzing the macro environment of the firm

Full text: https://firmstrategy.net/pest-analysis-of-the-firms-external-macro-environment/
PEST is a simple and useful analysis tool allowing strategic managers to capture an “general vision” of the firm’s macro-environment. Up to now, the PEST analysis is widely used with its four basic macro-environmental factors (Political, Economic, Social and Technological). Historically, in 1960s, researchers studied model and framework for analyzing the macro-environment in organizational strategy management. Aguilar (1967) studied the tools and techniques of macroeconomic analysis by introducing the ETPS analysis that focuses on Economic, Technological, Political, and Social environment. The last one was upgraded by Arnold Brown into STEP (Strategic Trend Evaluation Process) in terms of how to evaluate strategic trends. However, it wasn’t until 1970 that this framework was really attracted the attention and widely accepted by researchers and strategic managers under official name of PEST analysis used in the environmental scanning component of strategic management.

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