What SWOT analysis and how does it help organizations weigh their resources?


Widely referred as the essential part of varied business entities, SWOT stands for Strength, Weakness, Opportunities, and Threats. SWOT analysis is also used by nonprofit organizations and, to a little less degree, by individuals for their assessment. In addition to this, this analysis can also be used to assess products, initiatives, and projects. Albert Humphrey is the man behind this creation who tested the approach in the 1960s and 1970s at the Stanford Research Institute.


SWOT was developed for business as it was based on the data from 500 companies listed on Fortune, this technique has been embraced by all types of companies as an aid to reach a decision.

When and Why SWOT is used?

A SWOT analysis is generally brought into play at the beginning of or as a part of a strategic planning exercise.

For decision-making, this framework is regarded as one of the powerful support due to its ability to enable an entity to reveal opportunities for success that were unspoken earlier or to bring the threats attached to it in the limelight before they reach to an extent of excessively cumbersome.

For instance, through SWOT you can identify a market niche in which a business has competitive benefits or provide help to individuals to make a career success by indicating a path that optimizes their strengths while, at the same time, alert them to challenges that can turn the achievement into a failure.

SWOT Analysis

  • Strength

  • What does your organization do better than your competition?

  • Weakness

  • What does your organization need to improve upon?

  • Opportunities

  • What could market trends lead to increased sales?

  • Threats

  • What are the advantages competitors have over your organization?

SWOT Analysis

Elements of a SWOT Analysis

SWOT, as its names suggest, examines four elements

  • Strengths − Inner resources and attributes that shore up a successful outcome.

  • Weakness − Inner characteristics and resources that work against a successful outcome.

  • Opportunities − Factors that belong to the external aspects of an organization and its ability to capitalize on or use to its benefits.

  • Threats − External factors that could put the success of a company into a trouble.

Updated on 26-Jun-2020 08:49:55