How can the SWOT analysis help the business to attain its maximum potential?

 

SWOT Analysis is a simple marketing framework that helps people to understand internal and external factors that influence a business' future success and it does it in a way that utilises four quadrants: Strengths, Weaknesses, Opportunities and Threats.

SWOT analysis can help your business identify what it's doing right and what needs to change in the organization — and the process is surprisingly simple. SWOT analysis is a planning methodology that helps organizations build a strategic plan to meet goals, improve operations and keep the business relevant.

A SWOT analysis is a commonly used tool within strategy preparation and decision-making. It takes minimal research and is little to no cost. This type of analysis can be done relatively quickly, and often does not require hiring an external advisor. Businesses that are reaching for success build on the strengths, minimise their weaknesses and seize opportunities whilst protecting themselves from external threats. By taking advantage of a SWOT analysis, you can better understand your overall business structure and allow the development of goals. 

Other benefits of SWOT analysis are:

• It helps to understand your business and competitors
• It provides useful critical information that can be used for forecasting
• It helps decision makers to address weaknesses and threats and capitalise on strengths and opportunities.

Strengths

Strengths are internal factors that identify areas are successful when compared to other competitors. They are critical to giving your business a competitive advantage, hence it is important to make sure they are maintained and developed further in the future.

By building on strengths and maintaining them, businesses can grow and help achieve their goals.

Weaknesses

These are also internal factors that instead are putting your business at a competitive disadvantage. Weaknesses that are identified could prevent or delay you from achieving milestones. Damaged reputation, limited sources of finance or demotivated employees are all possible weaknesses. 

To remain competitive, the business needs to adequately deal with and minimise the weaknesses realistically. 

Opportunities

Opportunity factors are external possibilities that could be taken advantage of for future development. This element of a SWOT analysis identifies shifts in the external environment that create favourable circumstances which are positive to your business. They may be discovered based on the identification of strengths and weaknesses of your business. 

Seizing opportunities such as market growth (e.g. a new international market), technological innovations and trade liberalisation could lead to greater sales and advance your organisation's goals. 

Threats

Threats are factors that may jeopardise future business prospects. Inflation, negative media coverage and emerging competitors are examples of threats which could cause problems to the likelihood of growth or success.