Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis
A SWOT Analysis is a managerial decision making tool used to identify a firm's internal strengths and weaknesses, as well as external threats and opportunities.
Strengths are areas that the company is performing well in or is good at such as having a strong brand image or a good The attitudes, beliefs, values and norms of an organisation..
Weaknesses are areas that the company is not doing well in or is performing more poorly such as lack of investment in new technology or a poorly performing product.
Opportunities are things that could happen outwith the business to help them grow or become more profitable such as the chance to take over a competitor or a boom in the economy.
Threats are external factors that could prevent a business from meeting its goals such as:
- a new competitor opening or reducing their prices
- a A time of temporary economic decline when trade and industrial activity are reduced.
Strengths identified should be matched up to potential opportunities for the company.
Weaknesses should be improved. Threats should be allowed for and an action plan made to try and limit their impact.
The main reason that a company carries out a A method of assessing strengths and weaknesses along with external opportunities and threats. SWOT stands for Strengths, Weaknesses, Opportunities and Threats. is to help them in the decision making process. It allows them to:
- see areas where they could improve
- where they can plan for future eventualities
- highlight opportunities for future developments