A Simple but Powerful Business Tool

16 Jan

Whatever strategic decisions we make in our business it’s important to have as much information at hand to make the best choices for success.  A sometimes overlooked but, simple exercise that can provide much of that information is a S.W.O.T. Analysis.  

What is a S.W.O.T. Analysis?

S.W.O.T. = Strengths, Weaknesses, Opportunities, Threats

Part of a business and marketing plan, a S.W.O.T. analysis identifies a company’s strengths and weaknesses relative to customers and the opportunities and threats present in the market. Preparing a S.W.O.T. analysis (even without completing a detailed business plan) can identify those things that will help accomplish a company’s objectives (a strength or opportunity), or it may identify an obstacle (a threat or weakness) that must be overcome or minimized to achieve desired results.  A S.W.O.T. analysis is not difficult to create but, requires a company to take an honest look at itself and a thorough look at its environment.

Components of S.W.O.T. Analysis


An audit of a company’s strengths will assess what it does well, what are its most valued assets and resources and any advantages it has in the market. Conversely, identify weaknesses, vulnerabilities and what can be done better.  Both should be looked at relative to its importance to customers.


As important as preparing an internal analysis is looking at a company’s external environment and threats and opportunities.  Threats and opportunities change over time as the result of changes in the competitive, economic, political/legal, technological, or sociocultural environments in which a company operates.

With a completed S.W.O.T. Analysis, management will have a current view of the competitive landscape, any obstacles or potential roadblocks and areas identified for improvement internally.

Next Steps:

1- Prioritize identified strengths, weaknesses, threats and opportunities and complete a SWOT matrix (like the one shown) to visually show the analysis.

SmartDraw Software SWOT Analysis Matrix

2 – Develop an Action Plan to address weaknesses and threats and to take advantage of strengths and opportunities.

Importance of SWOT Analysis, by Regina Edwards, eHow Contributor
SmartDraw Software Templates for S.W.O.T. Analysis
SWOT Analysis by Anthony C. Denca


One Response to “A Simple but Powerful Business Tool”


  1. The gap The Gap is creating: SWOT Analysis | Tracy Schikora: The road to my MBA - April 2, 2012

    […] A Simple but Powerful Business Tool (marketingviewpoint.wordpress.com) Share this: This entry was posted in The Gap Inc. and tagged Banana Republic, Clothing, Gap, GapKids, Jeans, Old Navy, SWOT analysis by TMS0820. Bookmark the permalink. […]

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