What is a SWOT Analysis? Definition and examples - TechTarget (2023)

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  • Stephen J. Bigelow,Senior Technology Editor
  • Maria K. Pratt
  • linda tucci,Industry Editor -- CIO/IT Strategy

What is a SWOT analysis?

The SWOT analysis is oneframeto identify and analyze an organization's strengths, weaknesses, opportunities, and threats. These words form the acronym SWOT.

The main objective of the SWOT analysis is to reveal the factors that intervene in making a business decision or in establishing a business strategy. To do this, the SWOT analyzes the internal and external environment and the factors that can influence the viability of a decision.

Companies often use the SWOT analysis, but they also use itNon-profit organizationsand to a lesser extent individuals by personal judgment. SWOT is also used to evaluate initiatives, products or projects. As an example, CIOs could use SWOT to helpCreate a Strategic Business Planning Templateor conduct a competitor analysis.

(Video) SWOT Analysis - What is SWOT? Definition, Examples and How to Do a SWOT Analysis

The SWOT framework is credited to Albert Humphrey, who pioneered the approach in the 1960s and 1970s.Stanford Research Institute. Originally designed for businesses, SWOT analysis is based on data from Fortune 500 companies. It has been adopted by organizations of all kinds as a brainstorming aid for business decisions.

When and why should you do a SWOT analysis?

SWOT analysis is often used either at the beginning or as part of astrategic planningProcess. The framework is seen as a powerful decision support, enabling an organization to discover previously unspoken opportunities for success. It also highlights threats before they become too onerous.

SWOT analysis can identify a market niche in which a company operatesCompetitive advantage. It can also help people plan a career path that maximizes their strengths and warn them of threats that could thwart success.

This type of analysis is most effective when used to identify and pragmatically address business issues and concerns. Consequently, SWOT often implies a multifacetedmultidisciplinary teamable to share thoughts and ideas freely. The most effective teams would use experience and real data, such as revenue or cost figures, to create the SWOT analysis.

(Video) Business strategy - SWOT analysis

What is a SWOT Analysis? Definition and examples - TechTarget (1)

Elements of a SWOT Analysis

As the name suggests, a SWOT analysis examines four elements:

  • Internal attributes and resources that support a successful outcome, such as B. a diverse product line, loyal customers, or strong customer service.
  • Internal factors and resources that hinder success, such as B. a weak brand, excessive debt, or insufficient staff or training.
  • External factors that the organization uses or may use, such as favorable export tariffs, tax incentives, or key new technologies.
  • External factors that can jeopardize the success of the business, such as B. increased competition, weaker demand, or an uncertain supply chain.

DAVO OURHeadquartersis often used to organize the identified items into each of these four items. The matrix is ​​usually a square divided into four quadrants, with each quadrant representing one of the specific elements. Decision makers identify and list specific strengths in the first quadrant, weaknesses in the next, then opportunities, and finally threats.

Organizations or individuals conducting a SWOT analysis may choose to use various SWOT analysis templates. These templates are generally variations of the standard four-quadrant SWOT matrix.

How to Conduct a SWOT Analysis

A SWOT analysis typically requires decision makers to first specify the goal they want to achieve for the business, organization, initiative, or individual. Based on this, decision makers list strengths and weaknesses, as well as opportunities and threats.

There are various tools to guide theDecision-making process. They often provide questions that fall under each of the four SWOT elements.

(Video) How to Perform a SWOT Analysis

For example, to identify your organization's strengths, participants could be asked "What are you better at than others?" and "What are your advantages?" To identify weaknesses, you can ask them: "Where do you need to improve?" Similarly, they would answer questions like "What market trends could drive sales?" and "Where do your competitors have market share advantages?" to identify opportunities and risks.

Example of a SWOT analysis

The end result of a SWOT analysis should be a chart or list of a subject's characteristics. The following is an example of a SWOT analysis of an imaginaryretail workers:

  • Strengthen:good communication skills, punctuality in shifts, good customer service, gets along well with all departments, physical stamina, good availability.
  • Weaknesses:takes long smoke breaks, has poor technical skills, is very inclined to spend time chatting.
  • occasions:Store clerks, greeting customers and helping them find products, supporting customer satisfaction, supporting customers after purchase and ensuring purchase confidence, stocking shelves.
  • Threats:occasional lack of time during peak work hours due to breaks, sometimes too much time spent per customer after the sale, too much time in interdepartmental chat.

How to use a SWOT analysis

A SWOT analysis should be used to help a company better understand its current and future position in the market or against a set target.

Organizations or individuals using this analysis can identify competitive advantages, positive prospects, and existing and potential problems. With this information, they can make business plans or personal or business plans.organizational goalsto take advantage of and correct deficiencies.

Once SWOT factors are identified, decision makers can assess whether an initiative, project or product is worth pursuing and what is required to make it successful. Therefore, the analysis is intended to help an organization adjust its resources to the competitive environment.

(Video) How to Use SWOT Analysis

A SWOT analysis can be used to evaluate and consider a number of objectives.action plan, like the following:

  • the creation and development of commercial products or services;
  • make hiring, promotion or other personnel decisions;
  • assess and improve customer service capabilities and performance;
  • Definition of commercial strategies to improve competitiveness or improve business performance; Y
  • Make investments in technology, geographic locations, or markets.

SWOT analysis is similar to PEST analysis, which stands for Political, Economic, Social and Technological. PEST analysis allows companies to analyze the external factors that affect their operations and competitiveness.

Pros and Cons of SWOT Analysis

The benefits of using a SWOT approach include the following:

  • The analysis creates a visual representation of the factors most likely to affect whether the organization, project, initiative, or individual can successfully achieve a goal.
  • By involving experienced members of the interdisciplinary team, a SWOT analysis can foster many different perspectives and approaches.
  • Such diversity can allow a SWOT analysis to flesh out each element and uncover creative ideas and overlooked issues that might otherwise go unnoticed.

Although a SWOT snapshot is important for understanding the many dynamics that affect success, the analysis has limitations such as: B. the following:

  • The analysis may not include all relevant factors, as some strengths, weaknesses, opportunities, and threats can be easily overlooked or misinterpreted.
  • The input for each element can be many timesempiricallyor subjective and give a distorted perspective.
  • Because it only captures factors at any given time and does not consider how those factors may change over time, the insights SWOT provides may have a limited lifespan.

learn howAssess the needs of an organization and implement a technology strategyin this step-by-step guide.

(Video) SWOT analysis

This was last updated onMarch 2022

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FAQs

What is SWOT analysis and examples? ›

SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. Strengths and weaknesses are internal to your company—things that you have some control over and can change. Examples include who is on your team, your patents and intellectual property, and your location.

What is SWOT analysis definition and diagram? ›

A SWOT analysis is a visual study tool that can be used to identify specific strengths and weaknesses in work and personal life situations. It helps with decision making and planning ahead. A SWOT analysis diagram is formed by a two-by-two grid.

How do you create a SWOT analysis explain your answer in 3 5 sentences? ›

How to Do a SWOT Analysis
  1. Determine the objective. Decide on a key project or strategy to analyze and place it at the top of the page.
  2. Create a grid. Draw a large square and then divide it into four smaller squares.
  3. Label each box. ...
  4. Add strengths and weaknesses. ...
  5. Draw conclusions.

Why is SWOT analysis Important explain in 2/3 sentences? ›

A SWOT analysis will help you identify areas of your business that are performing well. These areas are your critical success factors and they give your business its competitive advantage. Identifying these strengths can help you make sure you maintain them so you don't lose your competitive advantage.

What is the best definition of SWOT? ›

SWOT stands for Strengths, Weaknesses, Opportunities, and Threats, and so a SWOT analysis is a technique for assessing these four aspects of your business. SWOT Analysis is a tool that can help you to analyze what your company does best now, and to devise a successful strategy for the future.

How do you write a SWOT analysis example? ›

Creating a SWOT analysis involves identifying and analyzing the strengths, weaknesses, opportunities, and threats of a company. It is recommended to first create a list of questions to answer for each element. The questions serve as a guide for completing the SWOT analysis and creating a balanced list.

Why is SWOT analysis Important explain in 3 to 5 sentences? ›

A SWOT analysis helps evaluate where a company stands in a competitive market and what steps need to be taken for further strategic planning, helping decision-makers draw a future roadmap for the company.

How do you write a SWOT analysis on yourself? ›

How to write a personal SWOT analysis
  1. List your relevant strengths. You may start by assessing what internal factors benefit you in the context of your situation. ...
  2. Review your weaknesses. While listing weaknesses, be honest and objective. ...
  3. Define your opportunities. ...
  4. Understand any potential threats. ...
  5. Make an informed decision.
9 Aug 2021

What are 4 examples of opportunities? ›

What are some examples of opportunities?
  • Get help on projects.
  • Propose working groups.
  • Get testers for new ideas or products.
  • Create a team to work on an idea you have.
  • Share your expertise or best practices in a particular field.

What is the main purpose of SWOT analysis? ›

A SWOT analysis is a tool for documenting internal strengths (S) and weaknesses (W) in your business, as well as external opportunities (O) and threats (T). You can use this information in your business planning to help achieve your goals.

What are examples of threats? ›

9 examples of threats in a SWOT analysis
  • Social perception. With the rise of social media, consumers are increasingly aware of the business practices of the companies they support. ...
  • Natural disasters. ...
  • Technological changes. ...
  • Legislation. ...
  • Competition. ...
  • Globalization. ...
  • Data security. ...
  • Rising costs.

What is SWOT analysis PDF? ›

A SWOT analysis evaluates the internal strengths and weaknesses, and the external opportunities and threats in an organization's environment.

What is a SWOT analysis for students? ›

Knowing what your strengths, weaknesses, opportunities and threats are puts you in a powerful position for action. The SWOT analysis is not action in itself, but it's a useful tool that helps you set goals, create a detailed career plan and act on it.

How do you explain SWOT analysis to students? ›

It's an amazing way to comprehend your strengths and shortcomings. SWOT is an acronym for 'Strength' 'Weaknesses' 'Opportunities' and 'Threats'. It's an evaluative strategy where you pick out your weaknesses to overcome and enhance your plus points. These four forces can determine your future course of action.

Who defined SWOT analysis? ›

The SWOT framework is credit to Albert Humphrey, who developed the approach at the Stanford Research Institute (SRI) back in the 1960s and early 1970s.

What is an example of a SWOT strength? ›

In a SWOT Analysis, strengths are written in the top left quadrant. They highlight the internal strengths that you or your organization might be able to take advantage of to meet your goals. Examples of strengths for a SWOT analysis might include motivation, a clear vision, or having strong prior knowledge.

How do you explain SWOT analysis in a presentation? ›

Once the SWOT analysis is complete, it may be presented to management or employees.
  1. Prioritize the most important strengths, weaknesses, opportunities and threats. ...
  2. Define each strength, weakness, opportunity and threat. ...
  3. Use bullet points rather than lengthy descriptions. ...
  4. Continue with the weaknesses, one per slide.

How do you create a SWOT analysis in Word? ›

How to create a SWOT analysis in Word
  1. Open Word and create a new document. Open the Microsoft Word application on your computer. ...
  2. Insert a table. ...
  3. Design your chart. ...
  4. Label your quadrants with headings. ...
  5. Enter your SWOT text. ...
  6. Save your SWOT chart. ...
  7. Share your SWOT chart.
8 Apr 2022

What is a SWOT analysis template in Word? ›

SWOT Analysis Diagrams in Microsoft Word

A SWOT analysis is a business tool aimed at long-term planning and is an effective way of outlining your strengths, weakness, opportunities, and threats. Although Microsoft Word is not primarily a diagramming tool, it can be used to create SWOT diagrams.

What is the most important part of the SWOT analysis? ›

A: The most challenging part of your SWOT analysis is looking at your internal and external data to decide what indeed are your strengths, weaknesses, opportunities, and threats. We recommend looking at objective data to help make these decisions.

What are 3 major benefits of a SWOT analysis? ›

Completing a SWOT Analysis should help you with things like: Understanding your competitive advantages & disadvantages. Finding things to improve about your organization. Understanding why some aspects of your organization are struggling.

What are opportunities in SWOT analysis? ›

Opportunities. Opportunities in SWOT result from your existing strengths and weaknesses, along with any external initiatives that will put you in a stronger competitive position. These could be anything from weaknesses that you'd like to improve or areas that weren't identified in the first two phases of your analysis.

What are the types of SWOT analysis? ›

These include: SWOT (strengths, weaknesses, opportunities, threats) analysis. PESTLE (political, economic, social, technological, legal and environmental) analysis. scenario planning.

What are examples of strength? ›

Some examples of strengths you might mention include:
  • Enthusiasm.
  • Trustworthiness.
  • Creativity.
  • Discipline.
  • Patience.
  • Respectfulness.
  • Determination.
  • Dedication.

Why is SWOT analysis important to yourself? ›

A personal SWOT analysis can provide insights based on your personality strengths, foreseeable challenges and present opportunities you can maximize in pursuit of career goals. Your awareness of your strengths, weaknesses, opportunities, and threats can be an invaluable advantage.

What are your threats examples answers? ›

Examples of threats: a. Competition for the job I want. b.
...
It should also highlight your strengths.
  • Strengths: Positives you can capitalise on, these should be your 'key selling points. ...
  • Weaknesses: Negative areas you need to improve on. ...
  • Opportunities: Positive external conditions you can take advantage of.
8 Sept 2006

What is the strength in SWOT analysis? ›

A SWOT analysis helps find the best match between environmental trends (opportunities and threats) and internal capabilities. A strength is a resource or capacity the organisation can use effectively to achieve its objectives.

What are examples of threats in a personal SWOT analysis? ›

Threats
  • What obstacles do you currently face at work?
  • Are any of your colleagues competing with you for projects or roles?
  • Is your job (or the demand for the things you do) changing?
  • Does changing technology threaten your position?
  • Could any of your weaknesses lead to threats?

What are your strengths and weaknesses examples? ›

My strength is self-motivated. My weakness is trusting anyone easily. My strength is I am a Discipline person every time my perfect performance. I consider my weakness is my weakness is I am a very excited person that I am wrong in some situations.

What is the importance of SWOT analysis essay? ›

SWOT analysis is a simple but useful framework for analyzing your organization's strengths, weakness, opportunites and threats that you face.It helps you focus on your strengths, minimize threats and take the greatest possible advantage of opportunities available to you.

What is a weakness in a SWOT analysis? ›

Weaknesses are negative and internal factors that affect your organizational successes. Few examples of organizational weaknesses are irrelevant target population, bad factory location, poor financial performance, poor systems that you apply, inexperienced leadership.

What do you do after a SWOT analysis? ›

How to Take Action After Performing a SWOT Analysis
  1. Step 1: Identify strategic alternatives. ...
  2. Step 2: Prioritize your strategic alternatives. ...
  3. Step 3: Balance your priorities. ...
  4. Step 4: Build a roadmap.
12 Apr 2018

What are examples of SWOT threats? ›

9 examples of threats in a SWOT analysis
  • Social perception. With the rise of social media, consumers are increasingly aware of the business practices of the companies they support. ...
  • Natural disasters. ...
  • Technological changes. ...
  • Legislation. ...
  • Competition. ...
  • Globalization. ...
  • Data security. ...
  • Rising costs.

What is SWOT analysis and examples for students? ›

What is SWOT Analysis for Students? As described, SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. SWOT analysis for a student implies the parts they are good at and factors that need improvement. Through SWOT analysis, a student can analyze what opportunities lie ahead of them.

What is SWOT analysis weaknesses examples? ›

Weaknesses are negative and internal factors that affect your organizational successes. Few examples of organizational weaknesses are irrelevant target population, bad factory location, poor financial performance, poor systems that you apply, inexperienced leadership.

What is SWOT analysis and why is it important? ›

SWOT stands for an organization's strengths, weaknesses, opportunities, and threats. Why is a SWOT analysis important when creating a business strategy? It's a powerful tool to assess internal and external factors that give a business a clear advantage and help it keep abreast of consumer trends.

What are 3 examples of weaknesses? ›

Examples of Weaknesses.
  • Self-criticism.
  • Shyness.
  • Lack of knowledge of particular software.
  • Public speaking.
  • Taking criticism.
  • Lack of experience.
  • Inability to delegate.
  • Lack of confidence.

What are opportunities in SWOT? ›

Opportunities. Opportunities in SWOT result from your existing strengths and weaknesses, along with any external initiatives that will put you in a stronger competitive position. These could be anything from weaknesses that you'd like to improve or areas that weren't identified in the first two phases of your analysis.

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