Who invented PEST analysis?

Fifty years ago, scholars were constantly researching strategic planning. Among them was American Professor at Harvard Business School named Francis J. Aguilar. After three years of constant research and hard work, he wrote a novel called Scanning the Business Environment. In this book, he discussed analysis and communication. He is the founder of the PEST analysis.

But at first, it begins as ETPS that encompasses four broad factors namely economic, technological, political and social influences. Arnold Brown who was a member of the American Institute of Life Insurance renamed ETPS to STEP analysis. The meaning of STEP was Strategic Trend Evaluation Process. External factors are the most vital ones in the macro-environment. The aspects indicate that they influence the surroundings but they are not easily influenced by the other factors

But after a few years, the acronym changed again and an extra E was added to STEP to make it STEPE. But the meaning was different this time. Now STEPE stands for Social, Technological, economic, political and environmental. STEPE represents ETPS but it is easier to remember than Aguilar’s version. In 1980 STEPE converted into STEEPLE and finally into PEST.

Who invented PEST analysis

The Impact of the PEST analysis

Aguilar’s research was the stepping stone for the PEST analysis. He contributed to the world of strategic planning by penning down two more books supporting the initial discoveries in his first book. But neither of them have an impact on the world of strategic planning like his first novel.

Without PEST analysis, organizations would not be able to make smart decisions for marketing in a particular operating environment. Strategic analysts would be complete without any tool to analyze the macro and micro environmental factors for a business.

More about PEST analysis 

PEST analysis is a tool for strategic planning of business by understanding and researching the political, economic, social and technological impacts. Without the discovery of PEST, the organizations would find themselves in conflict. They may become susceptible to violations of regulations and laws without any prior notice.

PEST analysis helps the enterprises in smart decision making and prevents any organization to incur any loss. According to some experts, PEST analysis is appropriate for all kinds of situations. Others say that the breakdown of some factors help the strategic planning to undertake an environmental scan.


Based upon the information from different sources there is no copyright over the acronyms or the analysis of any type or by anyone. But since the first mention of the PEST analysis was found in the book of Scanning the Business Environment by Francis J. Aguilar, he is considered as the father of the PEST analysis.