SWOT Analysis

SWOT Analysis

What is it?

A S.W.O.T. analysis is essentially an organized list that can be used to identify an organization's strengths, weaknesses, opportunities, and threats.

Strengths: Describe the positive attributes, tangible and intangible, internal to the organization.

Weaknesses: Aspects of the organization that detract from its value and places it at a competitive disadvantage.

Opportunities: Attractive external factors that represent reasons the organization is likely to prosper.

Threats: External factors beyond the organization's control that could place it at risk.

Strengths and weaknesses are internal to the organization, meaning that the organization can put effort towards changing them. Opportunities and threats exist externally, thus cannot be changed by the organization. Because the SWOT analysis considers both internal and external factors, it is sometimes referred to as an Internal-External analysis, and the SWOT matrix as an IE Matrix.

How is it used?

There are four quadrants of the matrix, all of which carry one of the following four categories: Strengths, Weaknesses, Opportunities, Threats. Each quadrant of the matrix asks specific questions regarding the organization that fall under the above-mentioned categories. To effectively use the SWOT analysis, an organization needs to have honest reflection and answer the questions with utmost sincerity. This can be done collaboratively or individually but with a collaborative comparison of answers. The end result is an organized list of the internal and external factors that play a role in the desired goals of the organization.

Why is it used?

The SWOT analysis can be used for an entire organization or for individual departments, programs, or projects. It is a way to organize what is known and identify what factors are assisting or hindering an organization or unit in achieving its goal. It gives a big picture that allows the organization to give direction on steps that need to be made to achieve a goal.

Advantages and Disadvantages of use?

Advantages-

· Allows the organization to identify what they are already doing well

· By pinpointing strengths, opportunities, weaknesses and threats, it gives clear direction to where the organization needs to focus

· Gives a clear picture to help the organization decide if the goal is attainable

Disadvantages-

· Can provide an overwhelming amount of information that may be discouraging (particularly the weaknesses and threats)

· Information derived from the SWOT analysis has no prioritization

· The SWOT analysis puts the organization’s interests above the community’s

Real World Examples of Use?

In October of 2017, famous department store Bon-Ton Stores, Inc. published a report detailing the company profile through a SWOT analysis. Below is the SWOT matrix and summary statement from the report.

“The Bon-Ton Stores, Inc. (Bon-Ton) is a regional department store chain operating stores under the Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's, Bon-Ton and Younkers banners. The company has a strong portfolio of private brands, which appeals to customers who seek fashionable clothing at lower price points. The company's focus on private label brands amidst an increasing price conscious and value seeking customer base, helps it in improving its sales as well as profit margins. However, intense competition in the market could limit the growth opportunities for the company" (The Bon-Ton Stores, Inc., 2017).

Resources & Bibliography

Gregory, Alyssa. (2018, February 16). How to Conduct a SWOT Analysis for your Small Business. The Balance.

Retrieved from https://www.thebalance.com/swot-analysis-for-small-business-2951706.

Mind Tools Content Team. (2017). SWOT Analysis. Mind Tools. Retrieved from

https://www.mindtools.com/pages/article/newTMC_05.htm.

The Bon-Ton Stores, Inc. SWOT Analysis. (2017). Bon-Ton Stores, Inc. SWOT Analysis, 1-7.

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