Introduction

PEST analyses are part of the process of decision-making as the business does not depend on the internal factors alone. Effective management followed by the strong workforce can help in bringing success however such strength might be reduced through the negative external factors such as the high saturated market or the unstable government. However, an improper managed business might succeed which might be due to the external factors such as high demand (Freedman 2013). Thereby, PEST analysis template can help the business leader to recognize and adapt to the external factors. It is important to understand that PEST analysis can be beneficial for any business as it will lead to better performance through a deep understanding of the external factors.

PEST denotes Political, Economic, Social and Technological that have an impact on the company. PEST analysis intends to provide the decision-maker with the proper understanding of the changes that might happen within the market. Such can influence the marketing and link of the company that has worked hard to establish (Freedman 2013). The PEST analysis template enables the entrepreneurs in discovering what factors can influence the business and establish strategies for handling the changes.

Political changes are the kind of news that gets major attention. Elections can remove a pro-business, government and replace it with one that is in favour of regulations. A company that has extensive government contracts has to be aware of possible shifts that could result in either new business, or decisions not to renew agreements. Business must be very in tune with any economic changes that occur. The market may serve up bitter medicine or handout superior rewards depending on the circumstances. Interest rates, cost of labour, and danger of possible inflation are going to have an impact on any corporate budget. The social factors may be something as simple as changes in popular trends in spending. Age demographics might also come into play and the social changes concentrate attention on the consumers. Our global economy is heavily influenced by technology and developments in electronic communication and mobile applications can play a role in business decisions. The latest technology could even cause a needed revision in blue prints or product design.

PEST analysis is majorly concerned with the external environment. With every criterion there are elements like the law, physical environment and the population ethics. Those conducting business can get the result and the analysis is highly important. Information can ascertain whether there would be an expansion or just the business consolidation within the area. Around the world there are regulatory collapse, companies vouch for new market that was not looked before. PEST analysis can enable in decision making and ascertain whether the business is profitable or not. The PEST analysis template for the accounting firm helps in understanding things in an objective phase. Thereby, it helps in encouragement of the strategic planning and the highlight of the desired data.

For the preparation of the template of the template for PEST analysis of an accounting firm, high volume information needs to be collected. Decision making needs to plan ahead of time from the area where the information is required to be extracted. PEST is mainly concerned with the external environment and hence a major tool for the purpose of collaboration with other sources of data likes the internal skills of the firm (Maranville 2011). Value derived from the template for the outer environment cannot be ignored. The guesses or assumptions after referring to the template help in better decision making and leadership. Therefore, properly done PEST analysis for the accounting firm provides the strangers a better scenario of the business. Hence, this is the type of clarity required for the decision making and funds allocation. Moreover, it even enhances the skills of doing business in a successful way.

When an accounting firm wants to operate in an environment that has high political stability the business environment needs to be understood. If the accounting firm wants to operate in different countries it needs to understand the political tension. This can be well understood with the PEST template as it will throw significant light on the growth of the industry and can spot the factors that impact the growth (Allison 2019). Hence, with the template the firm can understand the potential factors that will have an influence on the functioning. In lieu to this, there will be higher emphasis on the external factors and thereby create better performance.

Policy changes

Continuous change in the policies of the government impact the performance of the business through uncertainty of the environment. It is imperative to understand the current trend in the political scenario of the company which can be understood with the help of the PEST template. Entering into countries that has high taxation level can impact the profitability of the firm and hence PEST template can help in the best possible way. High level of taxation impacts the international trade and hence limits the export. With the PEST of the accounting firm, the external environment can be studied and hence a decision can be undertaken whether to invest in the R&D. With the PEST, a study can be done into the policies of taxation and the priorities of the government can be understood with ease. Moreover, the high trade restriction can ensure blockage to the export and will destruct the link with the foreign trade partner. Thereby through the PEST analysis a study can be undertaken of the business strategies that will enable the accounting firm to conduct better operations (Allison 2019). Similarly, the accounting firm can understand other factors such as foreign exchange rate, condition of labor market, savings rate and inflation with the help of PEST analysis. A detailed analysis can enable the accounting firm to evaluate the growth process of the industry and the entire organization. Moreover, the PEST analysis helps in understanding the lifecycle stage and hence it enables to know the extent to which the government has spent on the development of the infrastructure. Further the PEST even sheds light on the particular regulation of the country thereby enables better understanding the external scenario that impacts the firm (Maranville 2011). The growth rate of GDP signals the ability of the consumer to spend further. High unemployment strikes the availability of surplus labor at lower wages. Hence, operation in such marker reduces the cost of production. Thereby, it is important for the accounting firm to consider the rate of interest that will influence the borrowing skill and attitude towards the investment.

Thereby, it can be seen that PEST analysis template for the accounting is of vital importance that will shape the destiny. The information from the template can be used by the firm to understand the external factors. The information attained from the social, environmental analysis will enable to target the specific consumer group and hence the potential buyers can be traced. This will have a predominant advantage on the business strategy and hence will get better result from the customer end.

References

Allison, J. (2019). Values statements: The missing link between organizational culture, strategic management and strategic communication. International Journal of Organizational Analysis, 27(3), 666-689. doi:http://dx.doi.org/10.1108/IJOA-08-2018-1501

Freedman, L. (2013). Strategy. Oxford University Press

Maranville, S. (2011). The Art of Strategic Management: A Case-Based Exercise, 35(6), 782–807.