Critically evaluate the PESTLE and SWOT tools and discuss when it Assignment

Critically evaluate the PESTLE and SWOT tools and discuss when it would be appropriate for a strategic HRBP to them. Support you - Assignment Example It will also discuss another relevant theory with regard to its application in HR field. PESTLE/PEST PESTLE/PEST analysis explores different external macro-environmental situations such as political, economical, social, and technological factors in which the firm operates (PEST analysis). In other words, the PEST analysis is an overall environmental scan so as to assess opportunities and threats in the external environment. PEST analysis is a widely adopted concept and it has large number of applications as listed below; Business planning: this tool gives accurate information to management regarding targets toward the development of new products. Marketing planning: it also improves marketing planning process by providing valuable elements in a situation analysis phase. SWOT is the acronym of strengths, weaknesses, opportunities, and threats. It is a globally accepted concept that explores internal organizational factors such as strengths and weaknesses and external environmental fac tors such as opportunities and threats of a project. The SWOT analysis provides beneficial information whether a firm’s resources and potentials fit with the competitive environment in which it operates (SWOT analysis). Main applications of this concept are discussed below Strengths such as patents, reputation, and strong brand name; and weaknesses like poor brand name and high cost structure can be identified. Arrival of new technologies and withdrawal of regulations are some of the opportunities to a business whereas trade barriers and introduction of substitute products are threats. SWOT analysis focuses on these issues also. In addition, there are a lot of advantages and disadvantages to both techniques. Firstly, both these methods are easy to understand and simple to operate. PEST tool is very effective for assessing external changes in the case of multinational companies. The SWOT analysis is suggestible to achieve organizational mission while PEST analysis brings a cle ar picture of business’ external environment. A SWOT analysis can be performed by anyone who has adequate information regarding the day to day operation of the business and the market; hence it is a cost effective method. At the same time, a PEST analysis develops strategic thinking and clearly points out the threats to a business. Similarly, PEST tool would assist the organization to avert future difficulties. Although the simplicity of SWOT analysis is beneficial for a firm to reduce related expenses, it also eliminates the possibility of a critical presentation. Since the SWOT analysis does not assess the degree of threats and opportunities, the results obtained from this method require further research in order to get a comprehensive picture. The rapid changing nature of society raises many difficulties to PEST analysis in anticipating future developments. According to Haughey, PEST analysis tends to rely on assumption and therefore, it would minimise the accuracy of outc omes. In the opinion of Rabin (1999), Organisational downsizing is a management strategy that aims to focus more on the business activities by reshaping the firm’s structure into a smaller size. By downsizing the organisation, the management can terminate employees with poor performance; and it is possible to maintain a group of potential workers. The SWOT and PEST analyses greatly contribute to