- Components of a SWOT Analysis
- Why perform a SWOT Analysis
- When to perform SWOT Analysis
- How to perform SWOT Analysis
- From SWOT Analysis to TOWS Analysis
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats, and so a SWOT Analysis is a technique for assessing these four aspects of a business. SWOT analysis (or SWOT matrix) is a strategic planning tool used to help organizations identify strengths, weaknesses, opportunities, and threats related to business competition or project planning.
Strengths and weaknesses are internal to the company, things over which they have some control and can change. Examples include who is on the team, intellectual property and patents, and location.
Opportunities and threats are external things that are going on in the larger market outside the company. The business can take advantage of opportunities and safeguard against threats, but it can't be altered. Examples include competitors, raw material prices, and shopping trends.
The purpose of SWOT Analysis is to define the goals of the business venture or project and to identify the internal and external factors favourable and unfavourable to achieving those goals. This combination of evaluation metrics means that early in the project life cycle, a SWOT analysis is particularly useful for gaining a thorough overview of a company, product, brand, or a new project. SWOT has been defined as the tried-and-true strategic analysis tool
A SWOT Diagram is used to perform SWOT Analysis. A two-by-two grid forms a SWOT analysis diagram. Each quadrant has an outline of the strengths, weaknesses, opportunities, and threats ( SWOT) of the subject. A SWOT analysis is a simple way in any context to discover positive and negative factors. In particular, a 4-quadrant diagram identifies strengths, weaknesses, opportunities, and threats.
Creating a SWOT chart forces contributors to critically examine their circumstances and discover which obstacles need to be overcome or minimised. A SWOT can also help identify steps for short- and long-term success that should be taken.
Figure : SWOT Diagram and its quadrants