One of my hobbies is studying leaders who have made a significant impact. I define this by whether we are still talking about them 200+ years after they have died (see my previous article on Hatshepsut here). These are people that weathered the storms of change during their lifetime and the choices they made significantly impacted the course of history. How did they do it? For answers let’s look to one of my favorites and one of history’s most brutal.
Finding a PESTEL Framework Example in an Unusual Place
I visited Inner Mongolia in 2012 and noticed a constant travel companion, a jolly looking man on a throne. He is holding court on taxi cab dashboards, greeting you in restaurant lobbies, observing meetings in conference rooms from life size murals. Who is this man? The most fascinating man in the world – Genghis Kahn.
A 10-Year study reveals what great executives know and do
Kahn’s reputation is one of a ruthless dictator who was willing to do anything to stay in power, including killing his own brother! But he actually has a classic hero’s story and there is much we can learn from it. Kahn was born in poverty with no political connections, but through his own grit and strategic choices he built an empire that spanned from the Middle East/Eastern Europe to China and Korea. He transformed the Mongolian culture from one of warring tribes made of poor agricultural or hunters/gatherers to becoming the leaders of a trade route (the Silk Road) that spread wealth, knowledge, and resources. He was proactive and reactive to macro trends. He was agile.
Today, how does one ascertain the world’s macro trends? I could list websites, articles, podcasts, technology, and MOOC. However, these links would be outdated as soon as this post is published. There are however, principles, demonstrated by Kahn, for keeping your eye on the macro trends that will help you navigate the turmoil of a complex marketplace and build your empire. There are a few categories that macro trends fall into that will be relevant for you and your business and they are the same ones that Mr. Kahn kept his eye on: Political, Environmental, Sociological, Technological, Legal, and Environmental (aka The PESTEL framework).
The good executive keeps an eye on each of these categories and how they will influence their organization. The great executive determines in which areas he will be proactive and reactive. Reactive often gets a bad rap, but it is an important skill in a leader’s skill set. There will be events that are completely out of your control. Think about the Arab spring, changes in immigration policies, or the introduction of the iPhone. Not all of these were predicted, but all required quick reaction. Today, there are other trends that you can be more proactive about.
Automation: Are you at risk with the impending death of the single skill set? [Economic]
Big Data: Do you have the cognitive analytics in place to avoid asset failure? [Technological]
Gig Economy: How are you motivating and incentivizing flexible workers? [Social]
Business Products: Are your business tools useful, usable and satisfying? [Technological]
PESTEL Analysis Examples
Two illustrative PESTEL analysis examples from Genghis Kahn further help to clarify the benefits of being reactive and proactive. In the political sphere, Kahn anticipated the resistance that can occur after ‘acquiring’ another tribe and would keep the army captains in their positions of power, but also groom their #2s and #3s to be able to step in if they decided to shift allegiances. This had a two-fold effect – he had successors ready for major leadership positions and it provided political stability as the leaders were internally motivated to perform as their successors were eager to take over the role.
There’s More to Effective Leadership Than PESTEL Analysis Samples
Technology Played a Part Even in These PESTEL Examples
You may be thinking that technology may not have been a major force in Kahn’s time, but as they conquered more territories the weaponry and style of fighting changed from bows and arrows to gun powder and catapults. Imagine if your employees were literally putting their lives on the line every time they came up against a competitor with more advanced technology. One of the more unique aspects of the Mongolian army was that they traveled light. Everything a man needed he carried on his horse. There were no supply trains coming behind with elaborate tents, cooking utensils, and food. This trained the army to be reactive to the changing environment, picking up weapons from their latest enemies, building bridges from the captives of their foes. I’m not defending the man’s ethics, but the reactive design of his material is instructive.
Lessons From These Examples of PESTEL Analysis
As you look ahead to the landscape of your future territories, remember the lessons from Genghis Kahn. The ability to keep abreast of what is happening in the PESTEL spheres will get you a few lengths ahead of your competitors. Determining where you will be reactive and proactive is how empires are built.
Look Beyond PESTEL Framework Examples
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