Organizational strategies are the means through which companies accomplish their missions and goals. Successful strategies address four elements of the setting within which the company operates: (1) the company's strengths, (2) its weaknesses, (3) the opportunities in its competitive environment, and (4) the threats in its competitive environment. This set of four element strengths, weaknesses, opportunities, and threatshen used by a firm to gain competitive advantage, is often referred to as a SWOT analysis. SWOT was developed by Ken Andrews in the early 1970s. An assessment of strengths and weaknesses occurs as a part of organizational analysis; that is, it is an audit of the company's internal workings, which are relatively easier to control than outside factors. Conversely, examining opportunities and threats is a part of environmental analysis the company must look outside of the organization to determine opportunities and threats, over which it has lesser control.
Andrews's original conception of the strategy model that preceded the SWOT asked four basic questions about a company and its environment: (1) What can we do? (2) What do we want to do? (3) What might we do? and (4) What do others expect us to do?
The answers to these questions provide the input for an effective strategic management process. While Andrews' original conception of this analysis has been developed and changed to the more streamlined SWOT analysis that we know today, his work is the foundation of this activity.
STRENGTHS, WEAKNESSES, OPPORTUNITIES, AND THREATS
Strengths, in the SWOT analysis, are a company's capabilities and resources that allow it to engage in activities to generate economic value and perhaps competitive advantage. A company's strengths may be in its ability to create unique products, to provide high-level customer service, or to have a presence in multiple retail markets. Strengths may also be things such as the company's culture, its staffing and... [continues]
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