SWOT Analysis is recommended to retest and reevaluate your business strategy regularly.
It is important for an organization to analyze and study both the internal and external environments that surround their business. SWOT analysis is a simple system designed to check the strategic position of your company. It can help the company analyze certain situations and identify which action they should establish or prioritize for the betterment of the business.
SWOT Analysis organizes your company’s top strengths, weaknesses, opportunities, and threats. It is usually presented in a simple two-by-two grid.
This describes what your company does best or where you’re good at. These are the assets and internal resources that the company can make use of to achieve objectives. Strengths are positive features of your company and it is an internal factor. These are the things that are within your reach and control.
Weakness describes the internal deficiencies and restrictions that limit what you can accomplish within your company. These are the things that you might need to improve on to gain a competitive advantage. This is also an internal factor which means that these things are within the control of your company and therefore can be solved easily.
Opportunities can either be in the present or in the future. These are external situations, circumstances, or events that offer great possibilities that may lead to reaching your company’s goals and objectives.
Threats are external factors that your company has no control over. These are external forces, events or situations that may create conflicts in your company. Unlike your company’s weakness, threats couldn’t be solved that easily as these are out of your control. These threats can be in the present time or in the future.
A SWOT analysis is an effective and simple framework for identifying strengths, weaknesses, opportunities, and threats that the company is facing now or may face in the future. SWOT analysis is already useful on its own but combining it with different planning techniques would be better for a deeper analysis.