Discuss the functionality of PESTLE and SWOT analyses in the developing role of SHRM(STRATEGIC HUMAN RESOURCES MANAGEMENT ). To support your work, As in all assignments, cite your so

SWOT AND PESTEL / Understanding your external and internal context for better planning

and decision-making /

WHAT ARE SWOT AND PESTEL? SWOT and PESTEL are analytical tools that help identify the key external and internal factors that should be taken into account in order to achieve success in a project or initiative. They are usually used together, and are applied in a group setting to support effective strategic planning, decision-making and action planning. SWOT and PESTEL are cost- and time-efficient means for highlighting key issues relating to the context of a project or initiative which, if not identified and addressed, could critically affect the chances of success. They also offer the benefit of framing these issues in a way that is easy for participants to understand and discuss.

REQUIREMENTS FOR SWOT:

 Experienced facilitator

 Rapporteur.

 Flip chart with plenty of paper and marker pens.

 Optional: Laptop and projector.

 8 – 12 participants representing diverse relevant roles and ideally including decision- makers. (Alternatively, up to 40 participants if using subgroups; see Variations below.)

 1 hour for quick SWOT; 2 hours for normal SWOT, or up to a half-day SWOT workshop for major initiatives; plus preparation time.

ADDITIONAL REQUIREMENTS, IF ADDING PESTEL:

 1 – 6 persons with good research/analysis skills, to conduct initial research on the six PESTEL domains before the meeting and also participate at the meeting (they do count against the suggested limit of 12 participants).

 1 – 2 hours to review, expand and rank PESTEL inputs from research, before continuing with SWOT.

2 | SWOT and PESTEL / Tools / UNICEF KE Toolbox

WHEN AND WHY

TO USE

SWOT: Turning around the order for

better results

The term ‘SWOT’ refers to Strengths,

Weaknesses, Opportunities, and Threats.

Strengths and weaknesses are internal factors:

they exist inside the organization (or within the

partnership, if relevant to the project being

analysed). Opportunities and threats are

external: They exist outside the organization.

SWOT is a widely used and fairly well-known

tool; the method described here incorporates a

couple of changes from the ordinary SWOT,

intended to produce the strongest possible

results.

SWOT has often been done in the order

implied by the name: first examining strengths,

then weaknesses, opportunities and finally

threats. However, it is recommended instead

to first examine the external factors –

opportunities and threats – and then

proceed to the internal ones. This helps keep

a stronger focus on results, and helps you

identify which threats are ‘critical threats’ (i.e.

those that are compounded by corresponding

weaknesses) and which opportunities are

‘promising opportunities’ (i.e. those that are

matched by corresponding strengths). Those

who have changed the order of work in SWOT,

by examining opportunities and threats first,

often report being amazed at the improvement in

the value of the SWOT process. 1

Any project/initiative that is to be assessed using

SWOT must have clearly defined objectives which

are well understood by participants. Clear

objectives are a kind of lens, through which the

various external and internal factors relevant to

your project can be identified as Strengths or

Weaknesses, Opportunities or Threats. If the

objectives seem to be unclear, then have them

clarified and agreed before embarking on a SWOT.

The SWOT framework can be thought of as a

matrix. Here it is presented with external factors

first. Favourable for

achieving the objectives

Unfavourable for achieving the objectives

External origin Opportunities Threats

Internal origin Strengths Weaknesses

PESTEL: A powerful complement to SWOT

PESTEL, a complementary tool to SWOT,

expands on the analysis of external context by

looking in detail at specific types of issues that

frequently have an impact on implementation of

project/ initiatives. The term ‘PESTEL’ refers to the

domains it considers: Political, Economic, Social,

Technological, Environmental and Legal. PESTEL

involves identifying the factors in each of these six

domains that are relevant for the project being

considered. A special focus of PESTEL is

identifying trends. Thus it is helpful for thinking

proactively and anticipating change, rather than

being overtaken by it.

It is recommended to use PESTEL and SWOT

together. PESTEL complements SWOT by

1 For example, see Michael Watkins, “From SWOT to TOWS: Answering a Reader’s Strategy Question”, in Harvard Business Review online, https://hbr.org/2007/03/from-swot-to-tows- answering-a-readers-strategy-question/ . .

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SWOT and PESTEL / Tools / UNICEF KE Toolbox | 3

identifying specific relevant factors (such as

economic trends, social attitudes, technological

developments, etc.) that are significant for the

project being considered, and SWOT then

classifies them as either Opportunities or

Threats. The more complex your context or

operating environment is, the more value

PESTEL can offer, by identifying factors that

would be missed by SWOT alone.

Applying PESTEL is fairly simple: Of the nine

steps to do a SWOT described below, only

steps 2 and 5 are done differently when using

PESTEL. An extensive set of PESTEL

questions is provided in Annex 2 (see below),

to help participants identify more quickly and

easily the relevant factors in each of its six

domains. If you’re short of time, you can just do

a SWOT. But if time permits, then applying

PESTEL and SWOT together results in a

stronger analysis, a better understanding of the

current situation, and the potential for improved

decision-making.

Applications and benefits

SWOT (and, where possible, PESTEL) can be

applied for the following purposes:

 Creating, or helping create, a strategic

plan or an action plan when launching a

project/initiative. This is perhaps the most

common application of SWOT.

 Weighing the pros and cons of major

decisions. For example, use them to help

decide on whether to create or join in a new

initiative, to establish a significant new

partnership, to implement new methods or

tools (technological or non-technological), to

help plan a reorganization, to assess use of

resources and decide on how to improve

operational efficiency, etc.

 Reviewing positioning on an ongoing

project/initiative at a key moments of reflection,

identifying needed change in the approach or

methods being used, and making adjustments.

SWOT and PESTEL are flexible: They can be

applied for planning or decision-making concerning

an entire project/initiative, or alternatively it can be

used to focus on specific stages or components of

a project. For example, if you are working on an

immunization campaign, you could address all the

various programmatic aspects (supply and cold

chain, any needed training of health workers,

collaboration with government and partners, public

communication, etc.) in a single SWOT, or you

could break out the public communication aspect

and deal with that separately from the other

aspects.

Similarly, SWOT and PESTEL can be applied to

large or small (but significant) projects or

decisions. If time is very limited, or for small

projects, do a quick SWOT in an hour

(remembering to identify the Opportunities and

Threats first, and then the Strengths and

Weaknesses). With more time, or for

projects/decisions with larger implications, do a full

SWOT and PESTEL in about 3 hours, plus

preparation time. With even more time, or for very

significant projects/decisions, expand the time

accordingly, up to a full day workshop.

For a simple issue or question, SWOT and

PESTEL may provide sufficient basis for making

final decisions or creating an action plan. For

complex questions, SWOT and PESTEL will at

least lay a solid foundation, at low cost, for any

further in-depth research and analysis that may be

required. Prioritization of the issues in a PESTEL

and SWOT is typically quick and may need to be

refined when dealing with a really complex

challenge.

The fact that SWOT and PESTEL are group

processes means that they also offer the following

benefits:

 The breadth of perspectives in the group will

make the analysis broader and deeper than what . . .

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4 | SWOT and PESTEL / Tools / UNICEF KE Toolbox

an individual could produce in the same time,

and will help overcome individual bias and

limited viewpoints.

 The process will help get a team onto

the same page by creating a shared

understanding of the project context and key

external and internal factors. SWOT

participants often report being surprised by the

views of others on even simple issues and

challenges. It is best to surface those surprises

early before they can impede effective action.

 The process will also start the key

conversations that are needed to achieve

project success. The connections and

conversations can continue as needed after the

SWOT concludes, throughout the duration of

the project.

HOW TO APPLY

The following are the steps for a SWOT. The

more time you have for the SWOT, the more

time you should spend on the analysis and

discussion steps (steps 5-9 below). If you are

doing PESTEL, a little additional preparatory

research will be needed before the session.

Prepare in advance

1. Prepare a clear, brief draft statement of

the project objectives/decision to be

analysed in the SWOT. The statement should

consist of only a few sentences. If you already

have a project plan or proposal that is longer

than one page, shorten it for purposes of the

SWOT. You don’t need to capture every detail:

include only the essence of the project objectives

and expected outcomes or of the decision that is

under consideration.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2. Invite participants (about 8-12 for a normal

SWOT) who will be directly involved in the project,

or in the implementation of the decision. Share

with them, in advance, the draft statement of the

objectives and outcomes. Help the participants

prepare for the SWOT in one of the two following

ways:

 Option 1: Assign some or all participants

to conduct PESTEL research and to share

their findings with you a few days before the

event. Assign responsibility for surveying

factors in each of the six PESTEL domains:

give each of the domains to one person, or split

them among 2-3 people, or assign one person

who is very familiar with the context to cover

them all. The output of the PESTEL research is,

for each domain, a simple list of the key factors

with just enough information to clearly define

each of them. This could be a sentence, or a

brief paragraph. PESTEL research for one

domain (political, or economic, etc.) could run

anywhere from half a page to a few pages.

 Option 2: Simply ask participants to think

about threats, opportunities, strengths and

weaknesses before the event. Although not as

powerful as PESTEL, this will still help the

SWOT to be more relevant.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

When you are ready to start

3. Convene the meeting and briefly describe

the method. Ensure the rapporteur(s) are ready;

their notes will complement the flipchart sheets

that you will write during the meeting.

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SWOT and PESTEL / Tools / UNICEF KE Toolbox | 5

4. Confirm the group’s understanding of

the objectives and outcomes to be analysed

in the SWOT, and which team (organization,

partnership) would take action to implement

them.

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5. Brainstorm the external categories

(Threats and Opportunities):

 If you used PESTEL, then its results

should be the starting point. Share the

lists of PESTEL factors identified by those

who carried out the PESTEL analysis

(political, economic, social, etc.), by posting

them all at once on flipchart sheets for all to

see, or displaying them on PowerPoint

slides. Ask other participants to complement

the PESTEL research by suggesting

additional factors; this helps take advantage

of different knowledge among participants.

Next, brainstorm each PESTEL factor as to

what opportunities it offers and what threats

it carries. Record the results on flipchart

sheets. At this stage you are looking for lots

of relevant ideas.

Once all the PESTEL inputs have been

discussed, ask the group whether they can

identify any additional Threats, and then

additional Opportunities; you can prompt

them using the questions in Annex 1 below.

 If you did not use PESTEL, simply

brainstorm the Threats and

Opportunities, prompting participants

using the relevant questions in Annex 1.

Look for lots of ideas; don’t filter for

importance yet. Use a sheet of flipchart

paper (or even more than one) for each

category.

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6. Next, brainstorm the internal categories

(Weaknesses and Strengths), using the

corresponding questions in Annex 1 as prompts,

and looking for lots of relevant ideas.

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7. Rank the factors (O, T, S and W) by

importance. Remind participants that the

importance is linked to the potential impact of

the factor on the objectives and outcomes of

the project or decision, and to the likelihood of

such impact. Once all the categories have been

brainstormed, you will have four separate lists.

Post all sheets so that participants can see them.

Then discuss them to rank the ideas by

importance, and mark each idea with symbols to

indicate the group’s overall opinion, e.g. ++ for

very important factors, + for ones with some

importance, or 0 for unimportant factors. Keep the

discussion informal; you can ask for a show of

hands, but don’t take written ballots for ranking. Or

give all participants sticky dots with 3 different

colours and have them assign their ratings to each

of the ideas.

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8. Discuss how the highly rated items in the

categories relate to each other. For example, a

certain strength may relate to a certain opportunity,

or a certain threat may be made more significant

because of a certain weakness. This is easier if

you have used PESTEL and discussed Threats

and Opportunities first (because those factors will

make the impact of various Strengths and

Weaknesses more clear.

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9. Optional but recommended: At the end of

the session, if your group has decision-making

power, outline a short action plan based on

your analysis and on the objectives of the

project or decision. If your group is acting only in

an advisory capacity, suggest a few plausible

options for action. Or if your objective was to make . . .

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6 | SWOT and PESTEL / Tools / UNICEF KE Toolbox

a yes/no decision, summarize your

recommendation and reasons. Your action

plan/ recommendation should:

 pursue opportunities;

 overcome, prevent or avoid threats;

 use or capitalize on strengths;

 overcome, minimize or compensate for

weaknesses.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Follow-up

10. After the SWOT, prepare a written

summary with decisions/

recommendations, based on the flipchart

sheets and notes from the note-taker, and

distribute it to participants, decision-makers

and other relevant recipients

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TIPS FOR SUCCESS

SWOT

 Don’t make the subject of a SWOT too

broad; for example, don’t try to assess every

aspect of an Office’s or Division’s work. Instead

focus on specific, significant projects and

decisions, and conduct separate analyses for

each, as time permits.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

 Ensure you have diversity among

participants in a SWOT. A group composed of

participants with diverse backgrounds and

different perspectives can identify more of the

critical factors, more quickly, than can a

homogeneous group.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

 For every project, some opportunities and

threats are obvious, but others are hard to see

because they are still developing and will have

their full impact in the future. The latter kind of

opportunities and threats are more difficult to

identify and properly assess, but are potentially the

most significant of all.

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 Although SWOT is an analytical exercise, its

success depends on a flow of ideas from

participants. Therefore try to establish a relaxed

and participatory tone; consider using an

icebreaker if team members don’t know each other

well (see Icebreakers elsewhere in this Toolbox).

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

 During the discussion, keep the focus on the

objectives and expected outcomes of the

project/decision, and how the various factors relate

to the objectives.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

 If you are doing a quick SWOT (less than 1

hour), then it is OK for the statements of external

factors and internal strengths/weaknesses to be

somewhat general (though they should always be

accurate), and for the final ranking of the factors

(step 7 above) to be done quickly and somewhat

informally.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

 If you are doing an in-depth SWOT (3 hours

or more, including PESTEL) then get multiple

perspec

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