The SWOT analysis has been widely accepted in marketing and business literature as a valuable means of assessing the fit between what a firm can and cannot do (strengths and weaknesses) and the environmental conditions that influence firm choices and behaviour (opportunities and threats) (Ferrell and Hartline, 2011:120). Strategic focus and the development of effective, productive priorities is a frequently overlooked and undervalued condition of the modern business environment. For organisations seeking to establish more opportunistic competitive footholds, the SWOT analysis offers a snapshot interpretation of both internal and external variables that could both positively and negatively influence the effectiveness of business decisions (Ferrell and Hartline, 2011:122). One of the key values of the SWOT analysis is that it may allow firms to recognise those areas of the organisation that, whilst once highly successful and value-added business segments, are now in decline as a result of either internal or external conditions (Griffin, 2011:73-4). A more comprehensive exploration of the market including those forces that act upon corporate strengths or exploit organisational weaknesses will present both the opportunities and the threats that must be incorporated into the business strategy.
Organisational opportunities can be leveraged in order to increase corporate performance, either by converting weaknesses into strengths or by accessing new strengths that can be strategically integrated into the organisational model. Threats will limit this performance, and without addressing these limitations and degrading influences, firms may fail to effectively navigate market changes or variability (Griffin, 2011:70). Exploring the internal capabilities involves a segment by segment review of business processes, exploration of systems, evaluation of facilities and equipment, assessment of team skills and experience, definition of internal capabilities, and identification of areas for improvement (Bruce and Langdon, 2000). Exploration of external variables includes a comprehensive review of the consumer factor, competitive influences, market flux, and future predictions. Once the SWOT is constructed it is essential that key business drivers have not only been identified and included, but are easily identifiable within the summary (Bruce and Langdon, 2000). Ultimately, www.businessteacher.org.uk Page 2
the SWOT analysis is a regular process that provides organisations with a periodic snapshot of their business performance and a wide range of strategic opportunities. By restricting limitations that undermine business performance and value, firms will gradually gain strength and positioning within markets that may be highly uncertain or experiencing a constant state of adjustment. Firms which adjust and adapt their strategy to maintain market positioning or access new business segments are likely to actualise growth and improve competencies in those areas which might have otherwise been overlooked. In essence, the SWOT analysis is a wake-up call; a managerial tool that, when used appropriately and implemented effectively, can maximise competencies and enhance the overall influence of corporate strengths whilst establishing stability, dominance, and strategic orientation within the marketplace. Top 5 Sources for SWOT Analysis Study
Bruce, A., Langdon, K. (2000) Strategic Thinking. New York: Penguin Publishing. Cagan, M. (2006) Streetwise Business Plans. Avon, MA: Adams Media. Ferrell, O.C., Hartline, M.D. (2011) Marketing Strategy. Mason, OH: South-Western Cengage Learning, 5th Edition.
Fine, L.G. (2009) The SWOT Analysis: Using Your Strength to Overcome Weaknesses, Using Opportunities to Overcome Threats. New York: Create Space. Griffin, R.W. (2011) Fundamentals of Management. Mason, OH: South-Western Cengage Learning, 6th Edition.
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