Swot Analysis
Essay title: Swot Analysis
SWOT analysis
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SWOT Analysis, is a strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective. The technique is credited to Albert Humphrey, who led a research project at Stanford University in the 1960s and 1970s {using data from Fortune 500 companies}.
Contents [hide]
1 Strategic and Creative Use of SWOT Analysis
1.1 Strategic Use: Orienting SWOTs to An Objective
1.2 Creative Use of SWOTs: Generating Strategies
1.3 Evidence on the Use of SWOT
2 Internal and external factors
3 Use of SWOT Analysis
4 SWOT-landscape analysis
5 Corporate planning
5.1 Human resources
5.2 Marketing
6 See also
7 References
8 External links
[edit] Strategic and Creative Use of SWOT Analysis
[edit] Strategic Use: Orienting SWOTs to An Objective
Illustrative diagram of SWOT analysisIf SWOT analysis does not start with defining a desired end state or objective, it runs the risk of being useless. A SWOT analysis may be incorporated into the strategic planning model. An example of a strategic planning technique that incorporates an objective-driven SWOT analysis is SCAN analysis. Strategic Planning, including SWOT and SCAN analysis, has been the subject of much research.
Strengths: attributes of the organization that are helpful to achieving the objective.
Weaknesses: attributes of the organization that are harmful to achieving the objective.
Opportunities: external conditions that are helpful to achieving the objective.
Threats: external conditions which could do damage to the businesss performance.
Identification of SWOTs is essential because subsequent steps in the process of planning for achievement of the selected objective may be derived from the SWOTs.
First, the decision makers have to determine whether the objective is attainable, given the SWOTs. If the objective is NOT attainable a different objective must be selected and the process repeated.
[edit] Creative Use of SWOTs: Generating Strategies
If, on the other hand, the objective seems attainable, the SWOTs are used as inputs to the creative generation of possible strategies, by asking and answering each of the following four questions, many times:
How can we Use each Strength?
How can we Stop each Weakness?
How can we Exploit each Opportunity?
How can we Defend against each Threat?
Ideally a cross-functional team or a task force that represents a broad range of perspectives should carry out the SWOT analysis. For example, a SWOT team may include an accountant, a salesperson, an executive manager, an engineer, and an ombudsman.
[edit] Evidence on the Use of SWOT
SWOT analysis may limit the strategies considered in the evaluation. “In addition, people who use SWOT might conclude that they have done an adequate job of planning and ignore such sensible things as defining the firms objectives or calculating ROI for alternate strategies.” [1] Findings from Menon et al. (1999) [2] and Hill and Westbrook (1997) [3] have shown that SWOT may harm performance. As an alternative to SWOT, J. Scott Armstrong describes a 5-step approach alternative that leads to better corporate performance.[4]
These criticisms are addressed to an old version of SWOT analysis that precedes the SWOT analysis described above under the heading “Strategic and Creative Use of SWOT Analysis.” This old version did not require that SWOTs