Last week my colleague shared how great questions help develop success, this got me thinking about the impact of such reflection. When you’ve decided on your goals in business and in life you then need to work towards them. In other words, you need a successful strategy to back-up your ambitions.
The easiest place to start is what we know – in business this might be called a SWOT; where you assess the strengths, weaknesses, opportunities and threats to your company. However, we encourage clients to start outside the business and place it in context; then you can see the true value or cost of your business.
Talking with a group of business leaders recently we got them to take stock of the environment within which their companies operate. We sought to map the external forces that surround their businesses and identify their impact. The model we chose was a PESTLE – where you categorise the external world in terms of the political, economic, social, technological, legal and environmental forces within which your business exists.
The problem we’ve seen with a PESTLE - and other such tools like Porters 5 Forces, Situational Analysis, etc. – is that they are only of real value if they influence action, inform decisions and are used by the business. In and of themselves the process of completing these tools may be interesting but in business that does not always mean it was a valuable use of limited time and resources.
To make the process of using this tool valuable and create a strategy from the work, we structure our PESTLE into three clear stages:
- Assess the environment
- Analyse the factors
- Agree key Actions
Assessing is completing the PESTLE, taking time to list as many factors as you think relevant, whether directly impacting the business or not. Don’t worry about the categorisation of factors – many often have aspects that influence more than one area – the key is to complete the assessment.
Next, you Analyse the results, placing them in priority order and asking questions that identify the potential threats or opportunities of these external forces upon the business. Questions such as:
- How do the forces noted help or hinder the achievement of our goals (or mission)?
- Which factor's influence is significant or long lasting?
- What influences listed create added value for our products or services?
- Are there forces that could cost our business money?
Finally, you move to the Action stage. Now it is time to agree key actions – we often suggest starting with no more than three – to begin to apply your analysis.
When this is done, you have created and utilised a strategy. In business, it is not how in-depth or how long this takes but how useful it is to create a competitive advantage. This is what defines a successful strategy, and the word strategy itself means ‘to put a plan into action’.
If you haven’t rechecked your business environment for some time, then a good place to start is a PESTLE. The world is ever changing so your strategy needs to be dynamic to keep up. Download a free PESTLE from Know+Do and make a start today.