strategy formulation the pest and success factors

Strategy Formulation, the PEST, and Success Factors

In this unit we review another useful tool for strategic managers. PEST stands for the Political, Economic, Social, and Technological factors that are evaluated in this type of external analysis. The PEST further refines external factors identified through the SWOT. A PEST can be further developed through the use of generic questions. Not all of these questions apply to every organization, but they are a good starting point for determining relevant factors.

There are many ways to analyze a system and develop a strategic plan. In this phase, the financial situation of your firm must be taken into account. For example, if your firm wants to grow, this usually involves additional investment of capital. If your firm does not have the cash or the means to raise money to spend, then the goal may be dead in its tracks. We will explore three success factors in this unit: Suitability, Feasibility, and Acceptability.

Review Chapter 5: Strategizing, Section 5: Developing Strategy Through External Analysis in Principles of Management.

Read Acca Global: Thomas Wu’s “Strategic Choice: Johnson and Scholes Suitability, Feasibility, and Acceptability Model.” It is available from ACCA Hong Kong as an Adobe Acrobat file accessible here –…


Review the material in Chapter Five, Section 6 in Principles of Management v1.1 and “Strategic Choice: Johnson and Scholes Suitability, Feasibility, and Acceptability Model.”

Please answer the following questions:

1. How do you use the Johnson & Scholes framework to determine the optimal strategy choice?

2. How do we know an organization has made the optimal choice? What financial metrics might help to evaluate an optimal choice?

3. Describe a time an organization did not make an optimal choice. Using the Johnson & Scholes framework, how might the firm have improved its process?

Please answer in 200 words or more. Use your own words – please do not copy and paste from a web site. Be sure to use in text citation and provide references for your sources. Wikipedia is not a source.


Pick any organization you are familiar with and perform a PEST analysis. From The Principles of Management reading this week, reflect on table 5.1 which has a list of key questions to help you develop a PEST analysis.

How would your answer change if there were (1) a sudden advancement in technology, (2) social unrest, and (3) enhanced economic stability? Being specific, how would you determine the optimal strategy for the organization?

Prepare a two page (double-spaced) essay. The paper should be 12-point font, Times New Roman, be at least 500 words, and include a final source list.


Consider the following questions for reflection:

Suppose you wanted to start a company where you live. Which of the PEST factors would be the strongest? How would you evaluate the optimal strategy?

Please write an essay of complete and well composed paragraphs (250 word minimum for the entire essay) Be sure to use in text citation and provide references for your sources. Wikipedia is not a source.

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