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How PESTEL analysis helps businesses adapt to change


Image Source: Tumisu | Pixabay

Survival in today’s constantly shifting business world depends on a company’s ability to anticipate and adapt to external factors. One way to do so is by using the PESTEL analysis—a framework used to identify and monitor the macro-environmental factors impacting an organization. By analyzing these factors, companies can gain insights into existing opportunities and threats and use these insights to formulate their strategy to better align with the external environment.

Figure 1. PESTEL analysis framework | Adapted from

Recent global events have significantly impacted companies worldwide. Russia’s invasion of Ukraine led to worldwide food shortages, supply chain disruptions, and an energy crisis in Europe. The ongoing disruption in the supply chain coupled with geopolitical tensions have led to concerns about an upcoming recession, as evidenced by slow growth in the global GDP.

Persistent high energy prices have also contributed to inflation, which has resulted in central banks raising interest rates and causing currency devaluation worldwide. 

The prolonged COVID-19 lockdown in China also caused a severe strain on the global economy due to China’s prevalence as a global supplier. Moreover, tensions between the US and China continue to add uncertainty. 

Another external factor is climate change, which is posing new threats to businesses. Thus, regulations for climate protection are becoming increasingly stringent. 

Meanwhile, technology is becoming increasingly integrated into a wider number of industries, leading to increased digital transformation around the world.

In the face of these fast-paced and unpredictable external conditions, the PESTEL analysis is now more valuable than ever for businesses to navigate the challenges that arise. 

The PESTEL analysis is a simple framework that encourages businesses to consider the external environment in which they operate, prompting them to consider external factors that affect their operations and evaluate their potential impact. Furthermore, it provides valuable insights for decision-making, empowering organizations to make informed choices and adjust their strategies to better match the broader external landscape.

To sum it up, the PESTEL analysis enables businesses to foresee potential threats and proactively mitigate their impact while spotting emerging opportunities and capitalizing on them. 

Mapping the food industry’s PESTEL landscape 

The food industry is a complex network of businesses engaged in the production, processing, packaging, distribution, marketing, and selling of food and beverages.

Given their crucial role in feeding the world’s population, food businesses must ensure they are prepared to handle any external factors that may impact their operations. To illustrate briefly, a PESTEL analysis for the food industry may cover several factors (See Figure 2).


Figure 2. PESTEL analysis of the food industry | Adapted from

The aforementioned recent global events have led to reduced purchasing power and food price inflation. Sociocultural changes and a growing focus on wellness are also expected to shape the industry’s future. Moreover, technological advancements and environmental efforts are significant factors that will influence its outlook. Hence, conducting regular PESTEL analysis is vital for companies in the food industry to be future-ready.

Ultimately, the PESTEL analysis is an indispensable tool for businesses, regardless of industry. Current global developments have demonstrated the importance of monitoring macro-environmental factors. Companies that prioritize PESTEL analysis are more likely to thrive in the face of external challenges and emerging trends, and it is high time that all businesses recognize its value and incorporate it into their strategy formulation.

Stakeholder Management as Key to Outstanding Performance


Image Source: jplenio | PIxabay

For an organization to achieve and sustain outstanding results that meet or exceed the expectations of its stakeholders, it is necessary to define an inspiring purpose, create an aspirational vision, develop a strategy centered on creating sustainable value, and build a winning culture.

Direction setting prepares the way forward for the organization, but it needs to execute its strategy effectively and efficiently. The organization must

  • know who the stakeholders are in its ecosystem and engage fully with those that are key to its success;
  • create sustainable value;
  • drive the levels of performance necessary for success today and, at the same time, drive the necessary improvement and transformation once it becomes successful in the future.

When stakeholders that are the most important to the organization, such as key stakeholders, and are independent of the specific groups have been identified, it is likely that there is a degree of similarity in applying the following principles when engaging key stakeholders. 

An outstanding organization:

  • identifies the specific types and categories within each of its key stakeholder groups;
  • uses its understanding of the key stakeholders’ needs and expectations to achieve continuous engagement;
  • involves key stakeholders in deploying its strategy and creating sustainable value;
  • recognizes the contributions the key stakeholders make;
  • builds, maintains, and further develops the relationship with key stakeholders based on transparency, accountability, ethical behavior, and trust;
  • works with its key stakeholders to develop a common understanding and focus on how, through co-development, it can contribute to and draw inspiration from the United Nations Sustainable Development Goals and Global Compact ambitions; and
  • actively gathers the perceptions of its key stakeholders rather than wait for them to make contact.

Build Relationships and Ensure Support for Creating Sustainable Value

Partners and suppliers are the external parties that the organization chooses to work with to fulfill its purpose, achieve the vision, deliver the strategy, and reach shared objectives that benefit both parties.

In practice, we find that an outstanding organization: 

  •       understands the stakeholder model for its key partners and suppliers, with a clear segmentation based on the organization’s purpose, vision, and strategy;
  •       ensures its partners and suppliers act in line with the organization’s strategy and that mutual transparency, integrity, and accountability in the relationship is established and maintained;
  •       builds a trusting relationship with its key partners and suppliers to support the creation of sustainable value;
  •       works proactively with its key partners and suppliers to leverage the culture, expertise, and know-how of both parties and achieve mutual benefit.

Partners are considered operant resources that should also act on operand resources to co-produce value with customers and the firm to ensure the best results are delivered to customers. 

It’s a matter of value creation, which considers partners part of the core competencies. We should focus on choosing them and how they interact on the value chain to help improve the results in customer satisfaction and customer involvement.

Choosing the Right Partner

It’s a matter of interest. This is how Benoit Hanssen, the chief technical officer of Hutchison CP Telecommunication Indonesia, described one of the ways of choosing the right partner.

He said that as long as business goals match the partner’s business goals, everyone can ensure that they have chosen the right partner for a long-term relationship with a win-win strategy.

Moreover, choosing the right partner adds another competitive advantage to businesses. This occurs by depending on them to be part of the business and learn how to deal with customers and by increasing their participation in the value co-creation. 

Open relationships in terms of communication and exchange of data is another factor in choosing the right partner.

They have to ensure a smooth exchange of information with the firm for a long-term relationship that will bring benefits to both entities. This is accompanied by removing the boundaries between firms and their partners. Vargo and lusch stated that partners should agree on having an open relationship from the beginning while firms have to ensure fair treatment for all their partners. They also added that firms’ partners should understand the environment they will work in, the cultural boundaries, and the cultural development; all of these are considered important factors that partners should contribute to understanding them and acting with the firm according to them.

Attractive costs and full attention to the risk of offers delivered to the market are other factors when choosing the right partner. Partners should work closely with the firm to convey their solutions to the firm within the budget offered and make sure that the solutions offered can effectively add value to the firm and help improve their business. This is done by having partners who focus on developing their businesses research and study the market and the business they are partnering with. This way, they can develop solutions that can continuously help their partner (the firm) solve their problems, improve their presence in the market, and develop benefits among other competitors.

Improving the existence in the market and increasing the resources available to have additional knowledge about the market needs and perform strongly among other competitors are reasons for choosing the right partner. This directs us to more factors that play a major role in choosing business partners: a partner that has good knowledge about the market and customer needs and can add value to the firm through resources and capabilities.

Moreover, when firms try to offer more services or products to the market that are considered new for the firm in terms of capabilities and resources available, it may not be enough to proceed with such an option. Even when firms enter new markets, there are reasons to dig deeper in other firms’ strategies and potentials. It is important to look for partnerships with advanced capabilities and resources that are not just focused on the present time but are ready for technological developments and to produce outstanding output.

On the other hand, a partner’s reputation in the market is crucial. It gives the firm an advantage before its competitors because customers, suppliers, and even other partners will consider competitiveness as a reason to consider the firm.

In addition to reputation, previous achievements that are related to the quality of solutions offered by firms are also important. It will reduce the amount of pressure when monitoring partners’ outputs, especially when they offer services that are difficult to monitor.

Moreover, managerial capabilities should be taken into consideration when choosing a partner since it can play a major role in helping the firm learn more from this partner and facilitate the exchange of skills and experience.

If you’d like to learn more about developing the strategy of your organization, sign up for The KPI Institute’s Strategy and Business Planning Professional Certification.

Reference: EFQM Model

How Can Organizations Adopt the Genius Hour Strategy?


Image Source: Qimono | Pixabay

The genius hour is now an emerging trend in education that encourages students to learn based on their passion, background, and interests. It is considered less formal and less standardized than traditional approaches in learning.

Jen Schneider discussed how genius hour works in her article on EdSurge. The concept began with Daniel Pink’s notion of what drives people at work. He said that autonomy, mastery, and purpose are intrinsic motivators needed in the 21st century. 

He cited Atlassian and how they had a FedEx day at work as an example of applying autonomy in the workplace. The employees are given 24 hours to work on something they want to, with a team they want to work with, and ship it after the allotted time. It was initially called FedEx day because they have to deliver innovation “overnight.” Since 2005, the program has been called ShipIt. Atlassian’s ShipIt is continuously done and has been modified further to adapt to a remote-working culture in the advent of the pandemic.

Pink explored Richard Ryan and Edward Deci’s self-determination theory of motivation in his book “Drive: The Surprising Truth About What Motivates Us.” In their studies, Ryan and Deci discovered that people who worked on a problem-solving task without incentives finished it faster than people who were told they would get payment for their work. 

Ryan and Deci concluded that intrinsic motivation, or motivation that originates from personal interest, has more impact than extrinsic motivation, which depends on external rewards, like payment or recognition.

With freedom and dedicated innovation time, learners are able to set their own goals and pace and at the same time boost a genuine love for learning. In an employee’s case, the genuine hour as dedicated innovation time might be a way to build or rebuild a genuine love for what they do. 

How can other organizations or even individuals implement their own genius hour and deliver results?

How to Implement the Genius Hour

In the context of education, the genius hour allows students to dedicate one hour per week to work on something that they are passionate about. However, Schneider emphasized that students must follow these three rules:

  1. “start with an essential question that cannot be answered with a simple Google search”
  2. “research the question using reputable websites, interviews, and/or print resources”
  3. “create something – the product may be digital, physical, or service-oriented.”

The rules are lenient as well on the side of Atlassian. Their challenge for every ShipIt day is to drop everything work-related and identify and solve other problems of any kind and any size by working with a team of your choice. 

The end results or products are then awarded accordingly. Atlassian is known to be a technical organization, but it does not limit the ShipIt days to only technical problems and solutions. Therefore, the event becomes inclusive and brings out the innovators in everyone.

The Leader of the Future: Principles and Practices


There is no single formula for becoming the leader of the future. Every organization has its own culture, structure, and transformation journeys. But what happens in between the stages of change is where we realize we are going through the same struggles. 

Leaders who are not yet adapting to those needs would still find themselves rethinking their style because they can’t stop their environment and people’s behavior from evolving. Here are some of the common principles and practices for the leader of the future.

Practice empathy and empowerment. “As I understood it, many people were struggling at home because of the situation of the crisis that surrounded us. And I have to admit that I was also struggling at home. I think all of us were, one way or the other. So, it’s a question of being empathetic and trying to put yourself in the shoes of your colleagues,” Xavi Ballesteros, who is a Cambridge English Country Director in Spain and Portugal, said during a Q&A forum held by the Cambridge University Press.

Meanwhile, Elizabeth Cater, Managing Director of CEM, shared that she assessed their communication pattern and looked more closely into what empowerment could offer in return. What she did was “making sure that things can happen without me being in the room, because there are so many projects that we’ve been working on over the last few months and needing an approval from me on everything wouldn’t work. So, trying to understand how to engender empowerment across the teams has been a focus as well.”

Communicate with employees constantly. “The main challenge is to make colleagues work throughout the company and to manage different time zones,” Monica Marchis, Research Director of AMSI, told PERFORMANCE Magazine. “We have one-on-one weekly meetings with all team members and regular meetings with the team for an overview of all work done individually. This way, we enable perspective and recognition and ensure support. In order to gain coherence, a corporate governance project has been initiated and a job evaluation project for internal equity has been done.” 

Create new strategies for virtual meetings. According to The Economist, before the pandemic, managers were spending almost 23 hours weekly attending meetings. After the pandemic, barriers that keep people apart increased and organizations have to come up with new ways of running a meeting. Organizations can consider the following techniques:

  1. Designate an amount of time for each topic, and once the time is up, the timer will ring and participants can move on to the next subject matter.
  2. Write follow-up action notes that can be seen immediately in the meeting rather than sending the list via email.
  3. Set positive communication rules, such as allowing presenters to finish their statements before commenting and encouraging participants to speak up.
  4. Have an additional break after each presentation in a meeting.
  5. Come up with creative icebreakers.
  6. Develop interactive and visually appealing presentations.
  7. When there is a new meeting platform, perform trial runs with attendees to familiarize them with the functions.

Prioritize productivity over multitasking. One useful technique to assess serial-tasks and avoid multitasking is the Pomodoro Technique. It proposes working in a hyper-productive rhythm for 20 minutes without distractions. For managers still working in a hybrid environment, dedicating 20 uninterrupted minutes to a task seems reasonable rather than an entire one hour. Dividing the time into short bursts allows the brain to fully concentrate. At the end of the day, it seems more productive than a day spent multitasking.

Make individual strengths shine. If the pandemic taught us one thing in the organizational environment, it is that individuals have different needs and respond differently. To win over the actual context, the manager needs to balance shared team commitments and the unique needs and strengths of individuals. In the opposite corner, the one-size-fits-all method will erase the possible shining contributions of individuals. With this, managing a diverse team means the ability to shield performance from drawbacks.  

Keep it real. A potential leadership crunch can also be avoided by looking at the technique of trading perfectionism for compassion. Before COVID happened, a good day meant being able to submit all assignments and attend all meetings. The post-pandemic work life paints it differently. For working parents, it got even more difficult as they have to get the children accommodated with homeschooling while attending virtual meetings. This does not imply falling short of one’s own standards, but becoming more reasonable when it comes to the number of tasks they can accomplish.

If you’d like to boost your personal performance as an individual and a leader, check out The KPI Institute’s Personal Performance Professional Certification course.

Go Offline to Reconnect with Family During the Holidays


Image Source: freepik | freepik

The holiday season means spending more time with loved ones and practicing family traditions for many people. Since the worldwide COVID-19 outbreak, end-of-year gatherings and celebrations alongside school and work have been conducted virtually due to lockdowns and social restrictions. This year, family holidays and celebrations may return and show resemblances of normalcy as the world is slowly entering a post-pandemic era. 

This is evident in the case of family trips. A recent survey by the Family Travel Association and NYU School of Professional Studies saw that family trips are making a comeback, with 72% of participants saying that they would take a flight for a domestic trip while 40% would fly for an international trip with family. As more people are likely to opt for in-person gatherings with family, doing it during this era can still be challenging. Not only do families need to remain cautious and follow the health protocols, but they also might bring along some habits of overly depending on digital technologies. 

It is undeniable that some find it difficult to balance between their digital and real-life; oftentimes, the former spills over the latter, taking up family time. This means one might end up reducing interaction and socialization with family. Moreover, even though digital technology has been around for many decades, the pandemic has forced its integration into people’s lives, potentially disrupting family relationships.

Reconnecting with family

To maximize quality time with family and rebuild closeness during this holiday season, families can try to disconnect virtually and connect more in reality. Here are some ways to do just that.

  • Decide on a no-screen time together

    Phone etiquette such as not using phones at the dinner table has been around for some time now. This is a fundamental rule that allows you to disconnect as a family. By keeping devices out of sight, everyone can be fully present with other people around them and avoid distractions like endless pop-up notifications. Make necessary adjustments and hold everyone’s end of the bargain up in lessening their use of devices, especially during a trip to fully enjoy time together.

  • Do activities together as a family

    As everyone is disconnected virtually, the next step is to engage them in an activitythat can serve as quality family time. Initiate a discussion with each family member to suggest an activity that everyone can do together. This can include making holiday cookies, going Christmas shopping, praying together, spending one-on-one time with each child, and playing games with fun rewards and penalties. This can also be a good opportunity to pass down family traditions you grew up with and create new ones with your family. 

  • Disconnect from work

    Before going on holiday, it is important to finish work before leaving and make sure there are no unfinished tasks. This allows you to have peace of mind, rest properly, and return to work with better performance and productivity. However, some professions might be difficult to disengage from fully, even when on a holiday. In this case, try to dedicate a certain time to checking your email instead of keeping up with emails every time they arrive. It would be best if you also communicate this with people at work and your family to avoid unnecessary conflicts.

With the prevailing engagement in the virtual world for both parents and children, the family needs to intentionally put effort into balancing time spent online and the time spent to connect face-to-face. The holiday season can be the best moment to make up for lost time, have real conversations, and bring relationships closer by properly enjoying and respecting offline time together.


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