How are SWOT Analyses Used?
SWOT Analysis was originally developed as a strategic planning tool but is now also widely used for competitive intelligence and in the investment analysis process.
By understanding the strengths (S), weaknesses (W), opportunities (O) and threats (T) facing an organization, resources can be better allocated, new markets can be discovered, and competitive dangers can better defended.
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SWOT Analysis
When developing a SWOT analysis, information about strengths and weaknesses usually originates inside the organization – employee and customer surveys, analyses of resources and capabilities or core competencies. Information or data about opportunities and threats usually comes from outside – the political or economic environment, the industry or competitive situation. This is typically from secondary sources.
- Examples of Strengths include strong brand names, patents, reputation and cost advantages.
- Examples of Weaknesses include weak brand names, lack of patent protection and production inefficiencies.
- Examples of Opportunities include improving political or economic conditions, technological advancements that can accelerate production or market penetration.
- Examples of threats include the emergence of a new competitor, political or economic instability and new regulation.
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