The main objective of a SWOT analysis is to analyze and study the external and internal environments of a business by identifying and analyzing the weaknesses and strengths of the business and the threats and opportunities it exposed to.
Partly, the objective of the SWOT analysis is to assertively find the factors that influence the functions of the business that provides necessary information in the strategic planning process.
The SWOT analysis can be divided into two parts. They are the external environment, where threats and opportunities are determined and the internal environment where strengths and weaknesses are identified.
When beginning a new business, it is one of the major responsibilities for any individual. It is necessary to do research and make sure you are ready to take on the business world. A SWOT analysis that is properly conducted can give key insight about the various factors that may affect your business.
The SWOT information analyzes the various weaknesses, strengths, threats and opportunities to a business. Implementing a SWOT analysis is a perfect way to make plans, business strategies and setting goals and objectives for any business.
What information or detail is important to add to a SWOT analysis in general?
The key information or detail that plays a key factor in a SWOT analysis is defining specifically the areas that need attention. For instance, is the areas internal or external? Swysen, Lousbergh, Deneckere, and Vanhaech (2012) state, “when an organization matches internal strengths to external opportunities it creates core competencies in meeting the needs of its consumers; moreover, an organization should act to convert internal weaknesses into strengths and external threats into opportunities (p. 147). In the case if Hisco, the company has an internal risks / weaknesses. The mismanagement of funds of $130,000 illustrates an internal weakness / risk. This weakness / risk can be converted into a strength by hiring a talented financial manager.
How can a complete SWOT help a company succeed?
The proverb “two heads are better than one” applies to the reasoning of why a complete SWOT helps a company succeed. A complete SWOT analysis provides a different point of view on undiscovered niches in the market to exploit strategically; moreover, it provides affirmation to the company’s strengths to provide avenues to correct / covert a weakness into a strength or opportunity. In the Hisco case, the majority of the company’s problems stems from mismanagement of funds. The recruitment of a talented financial manager would turn a weakness into a strength.
Swysen, K., Lousbergh, B., Deneckere, S., & Vanhaecht, K. (2012). The use of a SWOT analysis as a strategic management tool in mental health care. International Journal of Care Pathways, 16(4), 146–151. https://doi-org.proxy-library.ashford.edu/10.1258/jicp.2012.012009