SWOT Analysis - Wikipedia, The Free Encyclopedia PDF

5/6/2015
SWOTanalysisWikipedia,thefreeencyclopedia
SWOTanalysis
FromWikipedia,thefreeencyclopedia
Forotheruses,seeSWOT.
ASWOTanalysis(alternativelySWOTmatrix)isa
PartofaseriesonStrategy
Strategy
structuredplanningmethodusedtoevaluate
thestrengths,weaknesses,opportunitiesand
threatsinvolvedinaprojectorinabusinessventure.A
SWOTanalysiscanbecarriedoutforaproduct,place,
industryorperson.Itinvolvesspecifyingtheobjectiveof
thebusinessventureorprojectandidentifyingtheinternal
andexternalfactorsthatarefavorableandunfavorableto
achievethatobjective.SomeauthorscreditSWOT
toAlbertHumphrey,wholedaconventionattheStanford
ResearchInstitute(nowSRIInternational)inthe1960s
and1970susingdatafromFortune
500companies.[1][2]However,Humphreyhimselfdoesnot
claimthecreationofSWOT,andtheoriginsremain
obscure.Thedegreetowhichtheinternalenvironmentof
thefirmmatcheswiththeexternalenvironmentis
expressedbytheconceptofstrategicfit.
Strengths:characteristicsofthebusinessorproject
thatgiveitanadvantageoverothers.
Weaknesses:characteristicsthatplacethe
businessorprojectatadisadvantagerelativeto
others.
Opportunities:elementsthattheprojectcould
exploittoitsadvantage.
Threats:elementsintheenvironmentthatcould
causetroubleforthebusinessorproject.
IdentificationofSWOTsisimportantbecausetheycan
informlaterstepsinplanningtoachievetheobjective.
Majordimensions
[hide]
StrategyStrategicmanagement
MilitarystrategyStrategicthinking
StrategicplanningGametheory
Strategicstudies
Thoughtleaders
[hide]
MichaelPorterHenryMintzberg
BruceHendersonGaryHamel
JimCollinsLiddellHart
CarlVonClausewitzSunTzuChrisZook
Concepts
[hide]
Businessmodel
CompetitiveadvantageExperiencecurve
ValuechainPortfoliotheory
CorecompetencyGenericstrategies
Frameworks&Tools
[hide]
SWOTFiveForces
BalancedscorecardStrategymap
PESTanalysisGrowthsharematrix
First,thedecisionmakersshouldconsiderwhetherthe
VTE
objectiveisattainable,giventheSWOTs.Iftheobjective
isnotattainableadifferentobjectivemustbeselectedandtheprocessrepeated.
UsersofSWOTanalysisneedtoaskandanswerquestionsthatgeneratemeaningfulinformationfor
eachcategory(strengths,weaknesses,opportunities,andthreats)tomaketheanalysisusefulandfind
theircompetitiveadvantage.
Contents[hide]
1Matchingandconverting
2Internalandexternalfactors
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3Use
3.1Strategybuilding
4Criticism
5SWOTlandscapeanalysis
6Corporateplanning
6.1Marketing
7SWOTAnalysisinCommunityOrganization
7.1ApplicationinCommunityOrganization
7.1.1ElementstoConsider
7.1.2StepsforImplementation
7.1.3WhentouseSWOT
7.2Benefits
7.3Limitations
ASWOTanalysis,withitsfour
elementsina22matrix.
8Seealso
9References
10Externallinks
Matchingandconverting
[edit]
OnewayofutilizingSWOTismatchingandconverting.Matchingisusedtofindcompetitive
advantagebymatchingthestrengthstoopportunities.Convertingistoapplyconversionstrategiesto
convertweaknessesorthreatsintostrengthsoropportunities.Anexampleofconversionstrategyisto
findnewmarkets.Ifthethreatsorweaknessescannotbeconverted,acompanyshouldtrytominimize
oravoidthem.[3]
Internalandexternalfactors
[edit]
SWOTanalysisaimstoidentifythekeyinternaland
externalfactorsseenasimportanttoachievingan
objective.SWOTanalysisgroupskeypiecesof
informationintotwomaincategories:
1. internalfactors
thestrengthsandweaknessesinternalto
theorganization
Soitissaidthatifyouknowyourenemiesandknow
yourself,youcanwinahundredbattleswithoutasingle
loss.Ifyouonlyknowyourself,butnotyouropponent,
youmaywinormaylose.Ifyouknowneitheryourself
noryourenemy,youwillalwaysendangeryourself.
TheArtofWarbySunTzu
2. externalfactorstheopportunitiesandthreatspresentedbytheenvironmentexternaltothe
organization
Analysismayviewtheinternalfactorsasstrengthsorasweaknessesdependingupontheireffecton
theorganization'sobjectives.Whatmayrepresentstrengthswithrespecttooneobjectivemaybe
weaknesses(distractions,competition)foranotherobjective.Thefactorsmayincludeallofthe4Psas
wellaspersonnel,finance,manufacturingcapabilities,andsoon.
Theexternalfactorsmayincludemacroeconomicmatters,technologicalchange,legislation,and
socioculturalchanges,aswellaschangesinthemarketplaceorincompetitiveposition.Theresultsare
oftenpresentedintheformofamatrix.
SWOTanalysisisjustonemethodofcategorizationandhasitsownweaknesses.Forexample,itmay
tendtopersuadeitsuserstocompilelistsratherthantothinkaboutactualimportantfactorsin
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achievingobjectives.Italsopresentstheresultinglistsuncriticallyandwithoutclearprioritizationsothat,
forexample,weakopportunitiesmayappeartobalancestrongthreats.
ItisprudentnottoeliminateanycandidateSWOTentrytooquickly.Theimportanceofindividual
SWOTswillberevealedbythevalueofthestrategiestheygenerate.ASWOTitemthatproduces
valuablestrategiesisimportant.ASWOTitemthatgeneratesnostrategiesisnotimportant.
Use
[edit]
TheusefulnessofSWOTanalysisisnotlimitedtoprofitseekingorganizations.SWOTanalysismaybe
usedinanydecisionmakingsituationwhenadesiredendstate(objective)isdefined.Examples
include:nonprofitorganizations,governmentalunits,andindividuals.SWOTanalysismayalsobeused
inprecrisisplanningandpreventivecrisismanagement.SWOTanalysismayalsobeusedincreatinga
recommendationduringaviabilitystudy/survey.
Strategybuilding
[edit]
SWOTanalysiscanbeusedeffectivelytobuildorganizationorpersonalstrategy.Stepsnecessaryto
executestrategyorientedanalysisinvolve:identificationofinternalandexternalfactors(usingpopular
2x2matrix),selectionandevaluationofthemostimportantfactorsandidentificationofrelationsexisting
betweeninternalandexternalfeatures.[citationneeded]
Forinstance:strongrelationsbetweenstrengthsandopportunitiescansuggestgoodconditionofthe
companyandallowusingaggressivestrategy.Ontheotherhandstronginteractionbetween
weaknessesandthreatscouldbeanalyzedaspotentialwarningandadvisefor
usingdefensivestrategy.[citationneeded]
Criticism
[edit]
SomefindingsfromMenonetal.(1999)[4]andHillandWestbrook(1997)[5]haveshownthatSWOT
mayharmperformance.Othercomplementaryanalyseshavebeenproposed,suchastheGrowth
sharematrixandPorterfiveforcesanalysis.
HeinzWeihrichsaidthatsomeusersfounditdifficulttotranslatetheresultsoftheSWOTanalysisinto
meaningfulactionsthatcouldbeadoptedwithinthewidercorporatestrategy.HeintroducedtheTOWS
Matrix,aconceptualframeworkthathelpsinfindingthemostefficientactions.[6]
SWOTlandscapeanalysis
[edit]
TheSWOTlandscapegrabsdifferentmanagerialsituationsby
visualizingandforeseeingthedynamicperformanceof
comparableobjectsaccordingtofindingsbyBrendanKitts,Leif
EdvinssonandTordBeding(2000).[7]
Changesinrelativeperformancearecontinuallyidentified.
Projects(orotherunitsofmeasurements)thatcouldbe
potentialriskoropportunityobjectsarehighlighted.
SWOTlandscapealsoindicateswhichunderlying
strength/weaknessfactorsthathavehadorlikelywillhave
TheSWOTlandscape
systematicallydeploystherelationships
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highestinfluenceinthecontextofvalueinuse(forex.capital
valuefluctuations).
Corporateplanning
betweenoverallobjectiveand
underlyingSWOTfactorsandprovides
aninteractive,queryable3D
landscape.
[edit]
Aspartofthedevelopmentofstrategiesandplanstoenabletheorganizationtoachieveitsobjectives,
thatorganizationwilluseasystematic/rigorousprocessknownascorporateplanning.SWOT
alongsidePEST/PESTLEcanbeusedasabasisfortheanalysisofbusinessandenvironmental
factors.[8]
Setobjectivesdefiningwhattheorganizationisgoingtodo
Environmentalscanning
Internalappraisalsoftheorganization'sSWOT,thisneedstoincludeanassessmentofthe
presentsituationaswellasaportfolioofproducts/servicesandananalysisofthe
product/servicelifecycle
Analysisofexistingstrategies,thisshoulddeterminerelevancefromtheresultsofan
internal/externalappraisal.Thismayincludegapanalysiswhichwilllookatenvironmentalfactors
StrategicIssuesdefinedkeyfactorsinthedevelopmentofacorporateplanwhichneedsto
beaddressedbytheorganization
Developnew/revisedstrategiesrevisedanalysisofstrategicissuesmaymeantheobjectives
needtochange
Establishcriticalsuccessfactorstheachievementofobjectivesandstrategyimplementation
Preparationofoperational,resource,projectsplansforstrategyimplementation
Monitoringresultsmappingagainstplans,takingcorrectiveactionwhichmaymeanamending
objectives/strategies.[9]
Marketing
[edit]
Mainarticle:Marketingmanagement
Inmanycompetitoranalyses,marketersbuilddetailedprofilesofeachcompetitorinthemarket,
focusingespeciallyontheirrelativecompetitivestrengthsandweaknessesusingSWOTanalysis.
Marketingmanagerswillexamineeachcompetitor'scoststructure,sourcesofprofits,resourcesand
competencies,competitivepositioningandproductdifferentiation,degreeofverticalintegration,
historicalresponsestoindustrydevelopments,andotherfactors.
Marketingmanagementoftenfindsitnecessarytoinvestinresearchtocollectthedatarequiredto
performaccuratemarketinganalysis.Accordingly,managementoftenconductsmarketresearch
(alternatelymarketingresearch)toobtainthisinformation.Marketersemployavarietyoftechniquesto
conductmarketresearch,butsomeofthemorecommoninclude:
Qualitativemarketingresearch,suchasfocusgroups
Quantitativemarketingresearch,suchasstatisticalsurveys
Experimentaltechniquessuchastestmarkets
Observationaltechniquessuchasethnographic(onsite)observation
Marketingmanagersmayalsodesignandoverseevariousenvironmentalscanningand
competitiveintelligenceprocessestohelpidentifytrendsandinformthecompany'smarketing
analysis.
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BelowisanexampleSWOTanalysisofamarketpositionofasmallmanagementconsultancywith
specialisminHRM.[9]
Strengths
Reputationin
marketplace
Expertiseatpartner
levelinHRM
consultancy
Weaknesses
Shortageofconsultants
atoperatinglevelrather
thanpartnerlevel
Unabletodealwith
multidisciplinary
assignmentsbecause
ofsizeorlackofability
Opportunities
Wellestablished
positionwithawell
definedmarketniche
Identifiedmarketfor
consultancyinareas
otherthanHRM
SWOTAnalysisinCommunityOrganization
Threats
Largeconsultancies
operatingataminor
level
Othersmall
consultancieslookingto
invadethemarketplace
[edit]
TheSWOTanalysishasbeenutilizedincommunityworkasatooltoidentifypositiveandnegative
factorswithinorganizations,communities,andthebroadersocietythatpromoteorinhibitsuccessful
implementationofsocialservicesandsocialchangeefforts.[10]Itisusedasapreliminaryresource,
assessingstrengths,weaknesses,opportunities,andthreatsinacommunityservedbyanonprofitor
communityorganization.[11]Thisorganizingtoolisbestusedincollaborationwithcommunityworkers
and/orcommunitymembersbeforedevelopinggoalsandobjectivesforaprogramdesignor
implementinganorganizingstrategy.TheSWOTanalysisisapartoftheplanningforsocialchange
processandwillnotprovideastrategicplanifusedbyitself.AfteraSWOTanalysisiscompleteda
socialchangeorganizationcanturntheSWOTlistintoaseriesofrecommendationstoconsiderbefore
developingastrategicplan.[12]
StrengthsandWeaknesses:Thesearetheinternalfactors
withinanorganization.
Humanresources[10]
Finances
Internaladvantages/disadvantagesoftheOrganization[10]
Physicalresources[10]
Experiencesincludingwhathasworkedorhasnotworkedin
thepast
OpportunitiesandThreats:Theseareexternalfactors
stemmingfromcommunityorsocietalforces.
Trends(newresearch)
oneexampleofaSWOTAnalysis
usedincommunityorganizing
Societyscultural,political,andeconomic
ideology[citationneeded]
Fundingsources[10]
Currentevents[10]
Societaloppression[10]
AlthoughtheSWOTanalysiswasoriginallydesignedasan
organizationalmethodforbusinessandindustries,ithasbeen
replicatedinvariouscommunityworkasatoolforidentifying
externalandinternalsupporttocombatinternalandexternal
opposition.[10]TheSWOTanalysisisnecessarytoprovide
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directiontothenextstagesofthechangeprocess.[13]Ithas
beenutilizedbycommunityorganizersandcommunity
AsimpleSWOTAnalysisusedin
CommunityOrganizing
memberstofurthersocialjusticeinthecontextofSocialWork
practice.
ApplicationinCommunityOrganization
[edit]
ElementstoConsider [edit]
ElementstoconsiderinaSWOTanalysisincludeunderstandingthecommunitythataparticular
organizationisworkingwith.Thiscanbedoneviapublicforums,listeningcampaigns,andinformational
interviews.Datacollectionwillhelpinformthecommunitymembersandworkerswhendevelopingthe
SWOTanalysis.Aneedsandassetsassessmentaretoolingthatcanbeusedinordertoidentifythe
needsandexistingresourcesofthecommunity.Whentheseassessmentsaredoneanddatahasbeen
collected,ananalysisofthecommunitycanbemadewhichwillinformtheSWOTanalysis.[10]
StepsforImplementation [edit]
ASWOTanalysisisbestdevelopedinagroupsettingsuchasaworkorcommunitymeeting.A
facilitatorcanconductthemeetingbyfirstexplainingwhataSWOTanalysisisaswellasidentifyingthe
meaningofeachterm.[10]
OnewayoffacilitatingthedevelopmentofaSWOTanalysisincludesdevelopinganexampleSWOT
withthelargergroupthenseparatingeachgroupintosmallerteamstopresenttothelargergroupafter
setamountoftime.[10]Thisallowsforindividuals,whomaybesilencedinalargergroupsetting,to
contribute.Oncetheallottedtimeisup,thefacilitatormayrecordallthefactorsofeachgroupontoa
largedocumentsuchasaposterboardandthenthelargegroup,asacollective,cangoworkthrough
eachthreatandweaknessestoexploreoptionsthatmaybeusedtocombatnegativeforceswiththe
strengthsandopportunitiespresentwithintheorganizationandcommunity.[10]ASWOTmeetingallows
participantstocreativelybrainstorm,identifyobstaclesandstrategizepossiblysolutionstothese
limitations.
WhentouseSWOT [edit]
TheuseofaSWOTanalysisbyacommunityorganizationareasfollows:toorganizeinformation,
provideinsightintobarriers[14]thatmaybepresentwhileengaginginsocialchangeprocesses,and
identifystrengthsavailablethatcanbeactivatedtocounteractthesebarriers.
ASWOTanalysiscanbeusedto:
Explorenewsolutionstoproblems[10]
Identifybarriersthatwilllimitgoals/objectives[10]
Decideondirectionthatwillbemosteffective[10]
Revealpossibilitiesandlimitationsforchange[10]
Toreviseplanstobestnavigatesystems,communities,andorganizations
Asabrainstormingandrecordingdeviceasameansofcommunication[14]
Toenhancecredibilityofinterpretationtobeutilizedinpresentationtoleadersorkey
supporters.[11]
Benefits
[edit]
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TheSWOTanalysisinSocialWorkpracticeframeworkisbeneficialbecauseithelpsorganizations
decidewhetherornotanobjectiveisobtainableandthereforeenablesorganizationstosetachievable
goals,objectives,andstepstofurtherthesocialchangeorcommunitydevelopmenteffort.[15]Itenables
organizerstotakevisionsandproducepracticalandefficientoutcomesinordertoeffectlonglasting
change,andithelpsorganizationsgathermeaningfulinformationinordertomaximizetheir
potential.[15]CompletingaSWOTanalysisisausefulprocessregardingtheconsiderationofkey
organizationalpriorities,suchasgenderandculturaldiversity,andfundraisingobjectives.[16]
Limitations
[edit]
CritiquesincludethemisuseoftheSWOTanalysisasatechniquethatcanbequicklydesignedwithout
criticalthoughtleadingtoamisrepresentationofStrengths,Weaknesses,OpportunitiesandThreats
withinanorganization'sinternalandexternalsurroundings.[17]Anotherlimitationincludesthe
developmentofaSWOTanalysissimplytodefendpreviouslydecidedgoalsandobjectives.This
misuseleadstolimitationsonbrainstormingpossibilitiesand"real"identificationofbarriers.Thismisuse
alsoplacestheorganizationsinterestabovethewellbeingofthecommunity.Further,aSWOTanalysis
shouldbedevelopedasacollaborativewithavarietyofcontributionsmadebyparticipantsincluding
communitymembers.ThedesignofaSWOTanalysisbyoneortwocommunityworkersislimitingto
therealitiesoftheforcesspecificallyexternalfactors,anddevaluesthepossiblecontributionsof
communitymembers.[14]
Seealso
[edit]
Benchmarking
Strategicplanning
Projectplanning
Enterpriseplanningsystems
SixForcesModel
VRIO
Porter'sFourCornersModel
ProgrammeEvaluationandReviewTechnique
DESTEP
References
[edit]
1. ^Humphrey,Albert(December2005)."SWOTAnalysisforManagementConsulting"
Newsletter(SRIInternational).
(PDF) .SRIAlumni
2. ^"AlbertHumphreyThe"Father"ofTAM" .TAMUK.Retrieved20120603.
3. ^Seeforinstance:Mehta,S.(2000)MarketingStrategy
4. ^Menon,A.etal.(1999)."AntecedentsandConsequencesofMarketingStrategyMaking".Journalof
Marketing(AmericanMarketingAssociation)63(2):1840.doi:10.2307/1251943 .JSTOR1251943 .
5. ^Hill,T.&R.Westbrook(1997)."SWOTAnalysis:ItsTimeforaProductRecall".LongRange
Planning30(1):4652.doi:10.1016/S00246301(96)000957 .
6. ^HeinzWeihrich."TheTOWSMatrixAToolforSituationalAnalysis"
(PDF) .
7. ^BrendanKitts,LeifEdvinssonandTordBeding(2000)Crystallizingknowledgeofhistoricalcompany
performanceintointeractive,queryable3DLandscapeshttp://de.scientificcommons.org/534302
8. ^Armstrong.M.AhandbookofHumanResourceManagementPractice(10thedition)2006,KoganPage,
LondonISBN0749446315
9. ^ a bArmstrong.MManagementProcessesandFunctions,1996,LondonCIPDISBN0852924380
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9. ^ a bArmstrong.MManagementProcessesandFunctions,1996,LondonCIPDISBN0852924380
10. ^ a b c d e f g h i j k l m n o p"CommunityToolbox:Section14.SWOTanalysis" .Retrieved20140222.

11. ^ a bWesthues,AnneLafranceJeanSchmidtGlen(2001)."ASWOTanalysisofsocialworkeducationin
Canada".SocialWorkEducation:TheInternationalJournal20(1):3556.
12. ^"OurCommunity" .Retrieved16March2014.
13. ^Birkenmaier,Julie(2001).ThePracticeofGeneralistSocialWork.NewYork,NY:Routledge.
14. ^ a b c Chermack,ThomasJ.BernadetteK.Kasshanna(December2007)."TheUseofandMisuseofSWOT
analysisandimplicationsforHRDprofessionals".HumanResourceDevelopmentInternational10(4):383
399.
15. ^ a bQuincy,Ronald."SWOTAnalysis:Raisingcapacityofyourorganization" .RutgersSchoolofSocial
Work.Retrieved20130225.
16. ^"TheChangeAgency" .Retrieved16March2014.
17. ^Koch,Adam(2000)."SWOTdoesnotneedtoberecalled:Itneedstobeenhanced" .Swineburne
UniversityofTechnology.
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