SWOT analysis is a common business acronym that stands for strengths, weaknesses, opportunities and threats. SWOT analysis is often referred to as SWOT matrix. A SWOT analysis can be applied to a company, product, place, industry or person. It entails identifying the organizational objective, as well as the exterior and interior factors that are favorable and unfavorable to achieve the objective. The SWOT process produces information that is useful in matching an organization or group’s goals, programs and capacities.
- Positive tangible and intangible attributes, internal to an organization.
- They are within the organization’s control.
- Factors that are within an organization’s control that detract from its ability to attain the desired goal.
- Which areas might the organization improve?
- External attractive factors that represent the reason for an organization to exist and develop.
- What opportunities exist in the environment, which will propel the organization? Identify them by their “time frames.”
- External factors, beyond an organization’s control, which could place the organization at risk.
- The organization may benefit by having contingency plans to address them if they should occur.
- Classify them by their “seriousness” and “probability of occurrence.”
A SWOT analysis is simple and practical to use. It is also easy to understand. SWOT focuses on the main internal and external factors that impact an organization. Utilizing SWOT helps organizations identify future goals and initiates further analysis.