It is not enough to do our job right. We must also see our opportunities and threats to do the right things. We use SWOT analysis to see our best options and threats rather than our strengths and weaknesses. When we identify our opportunities and threats, we ask which competencies we need to realize them. If these competencies are our strengths, we can easily avoid threats or discover opportunities without difficulty. On the other hand, if we have weaknesses, we are expected to make our plans considering that these opportunities and threats will challenge us a lot.
On the other hand, opportunities and threats depend on variables outside our influence. For example, we cannot influence exchange rates, interest rates, or economic growth or contraction. However, if such change is in our favor, we accept it as an opportunity; if it is against us, we take it as a threat and plan actions to realize our opportunities.
PESTEL analysis helps us identify these variables that are external to us.
