PESTLE and SWOT Analysis
Healthcare is a complex competitive business, and it’s imperative for it to be responsive to social and market pressures. A healthcare organization must reevaluate its effectiveness and market potential to remain viable and profitable. It must also assess mission effectiveness and explore potential avenues to expand operations in an effort to better serve healthcare consumers.
The method employed to derive such information must be carefully adapted to provide the most accurate assessment in order to develop effective strategic planning. Due to the nature of healthcare, political, economic, social, technological, legal, and environmental factors must be taken into consideration. This is accomplished through a scan that is commonly referred to as the political, economic, social, technological, legal, and environmental (PESTLE) analysis, which is used in conjunction with the strengths, weaknesses, opportunities, and threats (SWOT) analysis.
PESTLE analysis will contribute to the development of the opportunity and threat sections of the SWOT analysis. The information gained through a properly conducted PESTLE analysis is an aid in developing a greater understanding of issues and making a more robust vision path for the organization and the potential success of its mission.
Understanding SWOT and PESTEL
According to UNICEF (2015):
The SWOT analysis model is applicable to all industries. The term “SWOT” refers to Strengths, Weaknesses, Opportunities, and Threats. Strengths and weaknesses are internal factors and exist inside the organization. Opportunities and threats are external: They exist outside the organization. SWOT is a widely used and fairly well-known tool intended to produce the strongest possible results.
PESTEL, a complementary tool to SWOT, expands on the analysis of external context by looking, in detail, at the specific types of issues that frequently have an impact on the implementation of projects/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. (p. 2)
SWOT and PESTLE can be applied to the Strategic Human Resource Management function in the effort of talent acquisition and retention. The healthcare environment is highly competitive, and a lack of the available talent resource requires an effective strategic approach to maintain and provide the necessary patient care and organizational functionality.