What Is Swot
Strengths and Weaknesses
Relative to market needs and competitors’ characteristics, the marketing manager must begin to think in terms of what the firm can do well and where it may have deficiencies.
Strengths and weaknesses exist either because of resources possessed (or not possessed) by the firm, or in the nature of the relationships between the firm and its customers, its employees, or outside organizations (e.g., supply chain partners, suppliers, lending institutions, government agencies, etc.). Given that SWOT analysis must be customer focused to gain maximum benefit, strengths are meaningful only when they serve to satisfy a customer need. When this is the case, that strength becomes a capability.5 The marketing manager can then develop marketing strategies that leverage these capabilities in the form of strategic competitive advantages.
At the same time, the manager can develop strategies to overcome the firm’s weaknesses or find ways to minimize the negative effects of these weaknesses.
A great example of strengths and weaknesses in action occurs in the U.S. airline industry. As a whole, the industry was in trouble even before September 11, 2001. Big carriers—such as American, Delta, Northwest, and US Airways—have strengths in terms of sheer size, passenger volume, and marketing muscle. However, they suffer from a number of weaknesses related to internal efficiency, labor relations, and business models that cannot compensate for changes in customer preferences. These weaknesses are especially dramatic when compared to low-cost airlines such as
Southwest, Allegiant Air, AirTran, and JetBlue. Initially, these carriers offered low-cost service in routes ignored by the big carriers. Their strengths in terms of internal efficiency, flexible operations, and lower cost equipment gave low-cost carriers a major advantage with respect to cost economies. The differences in operating expenses per available seat mile (an industry benchmark) are
Relative to market needs and competitors’ characteristics, the marketing manager must begin to think in terms of what the firm can do well and where it may have deficiencies.
Strengths and weaknesses exist either because of resources possessed (or not possessed) by the firm, or in the nature of the relationships between the firm and its customers, its employees, or outside organizations (e.g., supply chain partners, suppliers, lending institutions, government agencies, etc.). Given that SWOT analysis must be customer focused to gain maximum benefit, strengths are meaningful only when they serve to satisfy a customer need. When this is the case, that strength becomes a capability.5 The marketing manager can then develop marketing strategies that leverage these capabilities in the form of strategic competitive advantages.
At the same time, the manager can develop strategies to overcome the firm’s weaknesses or find ways to minimize the negative effects of these weaknesses.
A great example of strengths and weaknesses in action occurs in the U.S. airline industry. As a whole, the industry was in trouble even before September 11, 2001. Big carriers—such as American, Delta, Northwest, and US Airways—have strengths in terms of sheer size, passenger volume, and marketing muscle. However, they suffer from a number of weaknesses related to internal efficiency, labor relations, and business models that cannot compensate for changes in customer preferences. These weaknesses are especially dramatic when compared to low-cost airlines such as
Southwest, Allegiant Air, AirTran, and JetBlue. Initially, these carriers offered low-cost service in routes ignored by the big carriers. Their strengths in terms of internal efficiency, flexible operations, and lower cost equipment gave low-cost carriers a major advantage with respect to cost economies. The differences in operating expenses per available seat mile (an industry benchmark) are