Use this section to show your understanding of the market you’re working in and what external factors could affect your organisation
A PESTEL analysis is a simple tool that allows you to identify big external trends and drivers that could have a positive or negative impact on your business. (PESTEL stands for political, economic, social, technological, environmental and legal: the six areas that the analysis covers.)
For voluntary organisations, this is often to do with the policy (political) environment or the changing needs of their beneficiaries (social). However, all the sections are important, and you might come up with challenges and opportunities that you hadn’t thought of before.
Work with your colleagues to complete the table.
You should show that you’re prepared to deal with upcoming challenges or take advantage of opportunities.
As a voluntary organisation, you might not be in a position to act on every opportunity because of a lack of time or resources. Highlight those that you plan to focus on and describe why you think they’re most important.
Most voluntary organisations will be used to competing for funds, often with organisations who are doing similar work. If you’ve ever applied for a grant, you’ll have had to state why you’re best placed to deliver the desired outcomes.
Competitor analysis is an extension of this: you need to think about where you’re stronger and weaker than your competitors in terms of delivering what the customer needs or wants.
If you’re trading with customers, your competitors are not always obvious. Think about who is competing for the customer’s money.
For example, if you’re a charity that offers a teaching product to schools, such as an outdoor classroom, you’re not just competing with other organisations that offer outdoor classrooms: you’re competing with all the organisations that offer teaching products to schools in your area.
These products might be completely different to yours, but the school has to make a decision whether to allocate their budget to you or another provider; they might choose a completely different activity. It’s up to you to understand what the school’s priorities are, how you complement the curriculum and what their budget allows. You’ll then have a better understanding of how you compare with your competitors.
Do this by reading annual reports, looking at data from the Charity Commission or Companies House, or mystery shopping.
A SWOT (strengths, weaknesses, opportunities and threats) analysis is a tool to help you work out how to stand out from the competition. You can complete it as a group exercise with colleagues or, ideally, with some of your customers or beneficiaries.
Don’t just dismiss your competitors – you can always learn something from how other organisations operate.
Last reviewed: 04 July 2022
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