Question

In 150 words or more, what information or detail is important to add to a SWOT analysis in general? How can a complete SWOT help a company succeed? These thoughts should be qualitative and generic - not discussing/providing specific applications of how you may have gleaned competitive advantage

Answer 1

SWOT analysis (Strengths, Weaknesses, Opportunities & threats) is helpful in the selection of a strategic direction of the business as it analyses positives and negatives of both internal and external environment and gives a complete outlook of the business.

The strengths (S) of the company are related to its internal factors like its capital, human resource, strategic location, R & D work, production unit etc.

The potential weaknesses (W) of the company is also related to its internal factors where company needs an improvement to remain completive in business for example its product quality, its high price, its limited resources etc.

Opportunities (O) are related to the external factor like positive market growth for the products of the company are the good opportunity for the company to plan for the business.

Threats (T) are also related to the external factors of the business which are not in the company’s control but can adversely affect the business so an analysis is important. Examples are technological changes or shifting consumer’s behaviors.

Therefore SWOT analysis helps companies in the strategic decision-making process and increases the understanding to the basic strategic management process and planning for future direction of business.