In today's business scenario, SWOT analysis plays a pivotal role, much of the business decision depends on this analysis. The concept was coined and developed by Prof. Albert Humphrey, who led the research at Stanford University; the study aimed to identify the reason behind the failure of corporate planning.
SWOT analysis is the procedure by which an organization takes the initiative to identify its internal strength and weaknesses and external factors like opportunities and threats. SWOT matrix stands for strength, weakness, opportunity, and danger.
It is an essential tool used by managers and a few other tools to analyze the positive and negative aspects of a business or an organization. Many prominent researchers have the opinion that SWOT analysis alone is meaningless. And if you go deep into the subject, you will realize that the conclusion drawn is true and empirical.
Overview of SWOT
The SWOT Matrix
If you are a marketer or an avid learner, you must learn about SWOT as an integral part of strategic analysis. It has diverse implications; you can use it to analyze any number of things; we sometimes use it to explore our blog and our company as a whole!
SWOT is also known as the TOWS Matrix; have a look at the graph below:
|Opportunity||S – O Strategy||W – O Strategy|
|Threat||S – T Strategy||W – T Strategy|
- S – O Strategy is the Strategy that utilizes the strength of a company to pursue the present opportunities.
- W – O Strategy is to pursue the opportunity by overcoming the company's weakness.
- S – T Strategy identifies the areas where the company can utilize its strengths to overcome the weaknesses in the business environment.
- W – T Strategy is the most defensive Strategy among all systems. Over here, the company will focus on minimising weaknesses and avoiding threats.
SWOT can be used in just about any field; it is a tool most used in strategic analysis by strategists because it gets conversions; Let me list a few of its applications:
- It can be used to find solutions to any of your business problems.
- It can help clarify the direction and support the decision-making process by identifying the opportunity and keeping in check the threat the business faces or might face soon.
- It can assist in determining the changes required in the business.
SWOT is an essential tool, be it any business, organization or institution; it has implications everywhere; Swot Analysis is a part of Marketing.