Environmental Scanning
Environmental scanning involves examining the economic and social forces influencing the organization, especially the long-term composition of the labor force and the future availability of employees. It’s an ongoing tracking of trends and occurrences in an organization's internal and external environment that may affect its success, currently and in the future.
Essentially, we are looking at external forces that may alter the way our organization conducts its business.
The PESTLE Analysis is a tool used to analyze those external factors on a macro level that influence an organization.
In the PESTLE Analysis
P: Political
E: Economic
S: Social
T: Technological
L: Legal
E: Environmental
Things we might consider when examining political factors are: Taxes and the federal deficit, Social Security , Minimum wage, Paid sick leave, Domestic partner benefits , Corporate governance, Affirmative action and attitude toward careers
Economic Factors: Rising health care costs, Shift to a knowledge-based economy , Emerging global economies, Increased accountability in corporate governance , Continued demand for increasing productivity
Social Factors: Age, Gender, Generational differences, Ethnicity ,Unskilled labor, Nontraditional labor force , Attitude toward careers
Technological Factors: Advances in technology, Communication advances, Employee self-service, E-learning, Data privacy, Advances in automation, Advances in innovation, Technological skills, Process changes
Legal: Changes to legislation impacting employment, access to materials, quotas, resources, imports/exports, and taxation
Environmental: Global warming and the increased need to switch to sustainable resources; ethical sourcing (both locally and nationally), including supply chain intelligence. Pandemics and other emergencies.
By analyzing those factors, organizations can gain insight into the external influences which may impact their strategy and business decisions. It allows HR practitioners to assess any risks specific to their industry and organization, and use that knowledge to inform their decisions.