The Sunday Mail
Well, PEST is an acronym for Political, Economic, Social and Technological factors which are used to assess the market for a business or organisational unit.
THE PEST analysis is considered to be sacrosanct to business as it is widely viewed to be a useful tool to understand market growth or decline.
It can be used to forecast the position, potential and direction a business or organisation is likely to take.
As such, the PEST analysis is a business measurement tool.
Well, PEST is an acronym for Political, Economic, Social and Technological factors which are used to assess the market for a business or organisational unit.
There is no doubt that there is a lot of anxiety and, to some extent, panic in the market today as the cash crunch takes its toll.
It doesn’t also help that monetary authorities are not routinely updating the market about the situation.
Of course, the unintended result of all this is that uncertainty inevitably sets in.
The market is currently consumed by raging debate from various quarters on how the market is likely to react when the Reserve Bank of Zimbabwe introduces bond notes soon.
Also, not surprisingly, the social media has been the major platform used by various interest groups to express their opinion.
Unfortunately, it might seem that most of the people that are openly expressing their views are of the opinion that the sky is falling.
It is not.
However, it is the self-deprecatory tendency of many commentators, who tend to speak fear and negativity of the economy, which is worrying.
It simply doesn’t make any sense to endlessly discuss and debate about our challenges without necessarily discussing key solutions to our situation.
There is definitely need to reconfigure our political, economic, social and technological (PEST) situation as we are not in a comfortable space.
But what is concerning to the market is that Zimbabweans seem pre-occupied to outdo each other in a race – rather unfortunately – to the bottom.
Statements that are made by public officials are viewed with scepticism and deeply scrutinised.
The social media, instead of enriching society, is now used to cast aspersions on public officials and also fabricate false stories that generally serve to destroy hope and sow pessimism.
Without doubt, the situation that we find ourselves in as a country is not ideal, but this is not the time for leaders — both in the public and private sector — to be doomsday forecasters.
Pointing fingers and apportioning blame will not fix the economy.
It is important distinguish between an opportune and inopportune time to discuss issues, including the timing and platform to discuss the same.
Fanning negative energy will only increase the country’s risk perception and scare away investors.
Just as all these challenges are man-made, they can also be unmade by man.
We need to change our language from one of doom and gloom to one of hope. We have certainly gone through turbulent times but it is certain that we have begun the journey to recovery. It’s however not going to be easy.
We have gone through a lot of challenges as a country and we have really learnt a lot.
Naturally, the PEST tool can be used as a starting point to begin addressing our issues.
Political factors include ecological and environmental issues, current legislation, the home market, future legislation, international legislation, regulatory bodies and processes, government policies, trading policies, funding, grants and initiatives, home market lobbying/pressure groups, international pressure groups and wars and conflicts.
One of the major factors working for Zimbabwe is that the country is not at war and is enjoying relative peace.
It’s a good starting point.
Social factors include lifestyle trends, demographics, consumer attitudes and opinions, media views, law changes affecting social factors, brand, company, technology image ,consumer buying patterns, fashion and role models, major events and influences, buying access and trends, ethnic/religious factors, advertising and publicity and ethical issues.
It must be noted that potential investors use this tool to make a choice either to invest in market A or market B. In addition, economic factors include home economy situation, home economy trends , overseas economies and trends, general taxation issues, taxation specific to product/services ,seasonality/weather issues, market and trade cycles, specific industry factors ,market routes and distribution trends, customer/end-user drivers, interest and exchange rates and international trade/monetary issues.
Looking at all the PEST factors above, it is very clear that we have a lot of work to do.
Local taxation laws in particular have to be reviewed in order to make them support economic growth.
Rwanda is a country that has emerged from deeper social and political challenges than us, but it has since chartered what seems to be a sustainable path of development.
We also need to do the same.
- Taurai Changwa, the MD of SAFIC Consultancy, is an articled accountant with vast experience in tax, accounting, audit and corporate governance. Feedback: [email protected], Facebook page SAFIC Consultancy or WhatsApp +263772374784
