SWOT is a tool used to analyse the Strengths, Weaknesses, Opportunities, and Threats that affect the functioning of businesses. The Business after identifying the business objectives requires the management to identify the internal issues as well as the external issues that affect completion of those objectives within the business. SWOT is used in strategic planning to effectively understand the environment to which success of the business is determined. To effectively understand the SWOT analysis tool, learners should identify and have a good understanding of the SWOT analysis framework;
From the SWOT template, it is clear that the strengths and weaknesses are both internal factors from the business, which learners should evaluate when analysing the achievement of specific business objectives. The opportunities and threats are external factors from outside the organisation, which the learners should evaluate and look into to ensure that they understand the issues that might have an impact to the organisation. Nevertheless, the strengths and opportunities are helpful to the businesses, and they should be taken advantage of. The weaknesses and threats are likely to have a negative impact, and are risky. In order to effectively achieve business success, the management should work on them and brainstorm on the strategies they should implement to address them.
SWOT analysis helps the management to carry out an assessment on the various issues that affect the internal and external business environment, and this enhances effective decision making process from the management. The SWOT analysis factors are flexible and thus the analysis process should be conducted often to ensure that the assumptions made when making specific business decisions are frequently reconsidered to create business success.
Advantages of SWOT analysis
Disadvantages of SWOT analysis
SWOT is a tool analyzes the strengths, Weaknesses, Opportunities, and threats that affect the functioning of businesses.