SWOT analysis is considered as a truthfully standard tool of strategic management for measuring the position of an organization. It is accepted and recognized by all strategic management experts. The SWOT analysis shows what are the strengths of an organization and in which areas it is lagging behind, how its weaknesses can bring challenges for it and how the organization can face the threats by grasping the opportunities available for it. SWOT analysis tells about all the positive and negative factors that are directly or indirectly associated with an organization.
Benefits of SWOT Analysis:
SWOT analysis improves the focus and lets you concentrate in the right direction. It detects the path at which a company needs to move on. It brings strategic alignment in decisions and actions of the management and organization because every member of the company is working by keeping the same goals in mind. SWOT analysis also determines the anonymous aspects of an organization. Let say a company is not aware of some of the hidden strengths which it has, or the new threats it can face in the market, but when they perform SWOT analysis they become familiar with it. This article by a dissertation writing service will help you to rightly perform the SWOT analysis of your organization by providing step by step detail.
Step 1: SWOT MATRIX:
First of all draw a big square and divide it into four equal and small squares. Start from the top left square and name each square in clockwise direction as strengths, weaknesses, opportunities and threats. Now on the left side beside the first top square write internal environment and besides the bottom square write external environment. From this matrix, it is very clear that the strengths and weaknesses of a company are affected by the internal environment of an organization whereas threats and opportunities are related to external environments.
Step 2: Determining Factors for Each Square:
In the next step, you have to determine what factors lie within each square. First, make the list of all these factors.
- Strengths: For listing the strengths of an organization first review the mission and vision statement of the company. It will tell about the core purpose of the business. What is the organization doing? What are its current activities? What competencies and proficiencies does it shine in? What are the strong resources of the company? Skills and resources are those factors that give one organization a competitive edge over the others. For instance, the brand name, customer satisfaction or access to latest technology can be the competitive edge.
- Weaknesses: The factors due which a company is lagging behind or its working is getting affected are called weaknesses of a company. These factors stop an organization from getting more advantages of its resources and assets. They are the hindrance in the way of moving forward. Examples of weaknesses include lack of resources and technology, poor financial condition etc.
- Opportunities: Opportunities are the external factors from an organization that can be benefited. It can be the environment, the customer repute or the development of several features that the organization should take benefits of. Opportunities can also be different events from which an organization can also take advantage. For example, opportunities like the upcoming sale season or any social or cultural event, or the opportunity of expanding the business to the country where the government is announcing subsidies.
- Threats: Threats are also a part of the external environment of an organization. These factors can potentially harm the business and its working and reputation. For example, the growing competition, entry of new rivals in market, change in supply and demand, partnerships of various competitors, changes in technology etc. all are the threats to an organization and which are beyond the control of organization. Threats are different from weaknesses. Weaknesses can be controlled through different strategies but threats are not under control.
After listing down all these factors, put them in their relevant squares.
Step 3: Applying the SWOT Analysis:
This step is more important as well as very complex. At this stage the management has to devise the strategies and make the decisions for controlling weaknesses, increasing strengths, maximizing and availing the right opportunities and getting rid of strengths. The company has to focus on those actions that don’t let weaknesses destroy the opportunities or increase threats. The organization has to make the strategies for converting weaknesses into strengths. Once the strategy for transforming weaknesses into strengths is done then it is time for creating a growth strategy. It means decisions for increasing business activities or expanding the business is required. But before making a growth decision the organization has to reduce the threats that can hinder the growth.