There are numerous models and techniques
produced by many educationists and researchers which help businesses perform
more effectively and efficiently (Frue, 2016).
There are two such models which help in the analysis of macro and micro aspects
for any business; which are:
PESTLE analysis is an analytical tool used
by the organizations to identify the macro environmental factors also termed as
external factors which impact the operations of business (Johnson et al., 2010)
. However, the organizations do not have a control over these external factors
but can always understand the implication of these factors. PESTLE model is an
integration of six macro-environmental factors, which are (Pahl &
Advantages and Disadvantages of
analysis provides a complete overview of the macro-environment impacting the
processes of a business(Johnson et al., 2010).
It is very
uncomplicated and self explanatory to use even for a beginner in any business
cross-functional expertise and proficiency.
Facilitate you to review proposition of entering new
markets locally as well as globally(Frue, 2016).
though the pestle analysis provides a wide overview of the macro environment,
however, this environment changes quickly and unpredictably, hence it becomes
quite tricky and challenging as to how PESTLE model will predict about the
macro environment with the changing dynamics(Frue, 2016).
model only predict about the macro-environment surrounding the business, on the
other hand overlooks the micro-environmental factors impacting upon the
of the massive sum of significant data from the correct resource get
difficult reason being the data is collected from all the external agencies(Woxman, 2011).
The two models
that can help in overcoming the weaknesses of PESTLE model are
The most important part of PESTLE model is
economic and social dynamics, reason being economic factor contributes not only
for the profitability of the company but also contributes in the GDP of the
country (Thakur, 2010).
And social factor highlights the wellbeing of the consumers and
organization employees as well.
SWOT analysis is the most recognized and
utilized model for the purpose of auditing and analyzing the strategic position
of any business model (Ferrell et
SWOT helps the organization in identifying the strategies of any business
and aligns them with the prospect opportunities based on the resources and
internal strengths of that business. SWOT analysis analyses the external
opportunities and match them with the internal resources and strengths to make
businesses perform more effectively as well as efficiently(Pahl & Richter, 2007).
SWOT analysis comprises of four components which are:
Advantages and Disadvantages of
There are various benefits of adopting the
SWOT model for the internal audit and evaluation of your business, which are:
evaluating the strengths of any organization and helps in combating against the
weaknesses as well(Ferrell et al., 2014).
response towards the opportunities maximizes and also helps in preparing well
against the threats the organization may face.
setting objective through tactical forecasting this model is the most ideal to
helps in identifying the core competency of any business(Pahl & Richter, 2007).
Along with the benefits there are always
certain disadvantages of using a model, for SWOT model these are:
analysis does provide the internal overview of the company but lacks in
providing the key solutions to the issues encountered(Cadle et al., 2010).
SWOT creates ambiguity in prioritization of the impacting factors.
too much on to the strengths can lead to ignorance towards the weaknesses and
does not focus on the macro-environmental factors impacting a business.
The weakness of the SWOT model can be
overcome by two other models which are:
The most important part of SWOT model is
recognizing the strengths of the company. This recognition can help an
organization in overcoming the threats and weaknesses more effectively.
Critical Analysis of Tesco:
SWOT of Tesco:
Following is the example of SWOT analysis for
the company Tesco:
PESTEL of Tesco:
The PESTEL of Tesco is as follows:
The analytical strategic tools PESTEL and
SWOT models are among the most commonly used tools for the macro and micro
environmental analysis by organizations.
Both models have their own benefits that can be availed by businesses of any sort PESTEL provides a wide
overview regarding the macro-environmental factors impacting the operations of
a business where as SWOT model helps in evaluation of the personal strengths
and opportunities of a business and also helps in combating the threats and weaknesses
with the help of company’s resources.