How can SWOT analysis be useful for both internal and external environment analysis?
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Business analysis models are useful tools and techniques that can help you understand your organisational environment and think more strategically about your business. Dozens of generic techniques are available, but some are used more frequently than others do. These include: Show
SWOT analysisSWOT analysis is one of the most popular strategic analysis models. It involves looking at the strengths and weaknesses of your business capabilities, and any opportunities and threats to your business. Once you identify these, you can assess how to:
See our SWOT analysis example. A SWOT analysis gives you a better insight into your internal and external business environment. However, it does not always prioritise the results, which can lead to an improper strategic action. One way to make better use of the SWOT framework is to consider the customer's perspective when making strategic plans and decisions. You can do this by applying importance-performance analysis to identify SWOT based on customer satisfaction surveys. Other strategic analysis toolsIn addition to SWOT, other useful techniques include:
Read more about strategic planning for business growth. Learning Objectives
A situation analysis is often referred to by the acronym SWOT, which stands for strengths, weaknesses, opportunities, and threats. Essentially, a SWOT analysis is an examination of the internal and external factors that impact the organization and its strategies. The internal factors are strengths and weaknesses; the external factors are opportunities and threats. A SWOT analysis gives an organization a clear picture of the “situation” in which it operates and helps it identify which strategies to pursue. Internal FactorsStrengths and weaknesses include the resources and capabilities within the organization now. Since the company has the most control over internal factors, it can craft strategies and objectives to exploit strengths and address weaknesses. Examples of internal factors include the following:
All of these are controlled by the organization. Competitive positioning can also be a strength or a weakness. While competitors’ strategies and tactics are external to the company, the company’s position relative to the competitors is something that it can control. External FactorsExternal factors include opportunities and threats that are outside of the organization. These are factors that the company may be able influence—or at least anticipate—but not fully control. Examples of external factors include the following:
While a company can control how it positions itself relative to the competition, it can’t control competitors’ actions or strategies. Benefits of a SWOT AnalysisA SWOT analysis benefits organizations in two key ways: Encourages Realistic PlanningImagine a growing company that is able to attract new customers more easily than the competition because it has a strong reputation and visible leader. These strengths should be considered and exploited in the strategy. Now imagine that the company also has a poor history of delivering on customer commitments. If this weakness is not addressed, it will not only make it difficult to retain customers but also likely damage the reputation of the company and its leader—which would eliminate key strengths. By conducting a situation analysis, the company is more likely to consider both of these factors in its planning. Improves Ability to Forecast Future EventsWhat’s the worst thing that could happen to your business? Most organizations can answer this question because they have assessed the environment in which they operate. For instance, perhaps they know of pending legislation that might adversely affect them. Or perhaps they recognize legal risks, or unique challenges from past economic cycles. By considering threats and “worst-case scenarios” during the planning process, organizations can take steps to avoid them, or minimize the impact if they do they occur. SWOT Analysis ExampleA situation analysis can benefit any organization. The example below shows the SWOT analysis for a fictional college.  Even this rudimentary analysis highlights some strategic issues, discussed below, which the college needs to consider. InternalThe college has a number of strengths. Committed faculty and trusted leaders have collaborated to build academic programs that are showing high completion rates among students. The student advising program is also contributing to that success. Also, the college has excellent relationships with businesses in the community. Among the weaknesses, the technology infrastructure is outdated. The college also employs a large number of part-time faculty members, but doesn’t provide them with adequate training or support. Nursing, one of the more expensive programs at the college, is not attracting enough students to keep it full. Also, the college has learned from some of its recent graduates that students are not receiving transfer credit at the local university for all of their courses taken at the college. The students wonder if the college faculty and advisers really understand their academic goals or the requirements of the four-year degree programs at the university. By completing a SWOT analysis, the college can shape its strategies and objectives to align with both the internal resources and capabilities it has, as well as the external factors it faces. ExternalThe college leadership is feeling pulled by conflicting economic factors. The region has been through an economic downturn, which resulted in cuts to state funding. At the same time, an economic recovery has just begun. During the previous economic recovery, college enrollment dropped when students who were pursuing additional education returned to the workforce. How might the timing of those two funding issues work out? The college is also being affected by a local institution that is aggressively marketing to its students— especially students in the nursing program. Still, there are opportunities. Students have expressed interest in more online courses and programs. That might also slow the local competitor, though it would also require the college to address its aging technology infrastructure. The college has identified a number of innovative programs that would enable students to earn degrees more quickly and at the same time expand its partnership and collaboration with local businesses. How can a SWOT analysis be useful for both internal Organisation and external environmental analysis in social marketing?Seizing opportunities
Opportunities are created by external factors, such as new consumer trends and changes in the market. Conducting a SWOT analysis will help you understand the internal factors (your business's strengths and weaknesses) that will influence your ability to take advantage of a new opportunity.
How can a SWOT analysis be useful for both internal and external organizational environmental analysis discuss?SWOT Analysis helps you to identify your organization's Strengths, Weaknesses, Opportunities, and Threats. It guides you to build on what you do well, address what you're lacking, seize new openings, and minimize risks. Apply a SWOT Analysis to assess your organization's position before you decide on any new strategy.
How SWOT is used for internal and external analysis?SWOT (strengths, weaknesses, opportunities, and threats) analysis is a method for identifying and analyzing internal strengths and weaknesses and external opportunities and threats that shape current and future operations and help develop strategic goals. SWOT analyses are not limited to companies.
How can SWOT analysis be used for environmental analysis?To respond effectively to changes in the environment, it is important to understand external and internal contexts to develop a vision and a strategy that link the two. The purpose of the SWOT analysis is to provide information on an organization's strengths and weaknesses in relation to the opportunities and threats.
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