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Eva Chen Paul Bruneski
SWOT Analysis Strengths, Weaknesses, Opportunities, Threats
History of SWOT
In the 1960’s and 70’s, Albert Humphrey is said to have developed this strategic planning tool using data from the top companies in America at the time. A SWOT Analysis looks at the strengths, weaknesses, opportunities and threats that are relevant to an organization in a new venture. A SWOT Analysis is a tool which allows users to look at the direction a company or organization may wish to move towards in the future. A SWOT Analysis is a useful tool, which in conjunction with others can help make informed decisions.
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SWOT analysis groups key pieces of information into two main categories: The internal factors may be viewed as strengths or weaknesses depending upon their impact on the organization's objectives. What may represent strengths with respect to one objective may be weaknesses for another objective. The factors may include all of the 4P's; as well as personnel, finance, manufacturing capabilities, and so on. The external factors may include macroeconomic matters, technological change, legislation, and socio-cultural changes, as well as changes in the marketplace or competitive position. The results are often presented in the form of a matrix.
Internal factors – The strengths and weaknesses internal to the organization. External factors – The opportunities and threats presented by the external environment.
Figure 1: SWOT Analysis Matrix Source: Wikipedia
Before carrying out a SWOT analysis, consider the following guidelines...
realistic about strengths and weaknesses. When performing a SWOT analysis on your business, be neither modest nor overly optimistic.
Consider answers from the
company’s point of view and from the point of view of customers, vendors, distributors, and others who do business with them.
between where the organization is today and where it could be in the future. Note that the SWOT is subjective. No two people will come up with the same SWOT.
Potential Uses of SWOT Analysis
Set Objectives– defining what the organization is intending to do Environmental Scanning– internal appraisals of the organizations SWOT, this needs to include an assessment of the present situation as well as a portfolio of products/ services and an analysis of the product/ service life cycle Analysis of existing strategies, this should determine relevance from the results of an internal/external appraisal. This may include gap analysis which will look at environmental factors. Strategic issues defined– key factors in the development of a corporate plan which needs to be addressed by the organization Develop new/revised strategies– revised analysis of strategic issues may mean the objectives need to change Establish critical success factors– the achievement of objectives and strategy implementation Preparation of operational, resource, projects plans for...