How to use SWOT analysis?

SWOT Analysis (also known as strengths, weaknesses, opportunities and threats analysis) is the easiest way to get started with strategic analysis. From the process of understanding yourself and your competitors, you can find out the key to success!

A simple understanding of SWOT: Strength, Weakness, Opportunity and Threat.

Strengths and Weaknesses focus on the “internal” factor of a business or product being analyzed
Opportunities and Threats are the “external” environmental of a business or product being analyzed

SWOT Analysis Infographics | SWOT Analysis Template

Strength. A company’s ability to outperform its competitors, or a company’s unique strengths that increase its competitiveness.
Weaknesses. An area in which a company underperforms or fails to perform compared to its competitors, thereby putting itself at a disadvantage compared to its competitors.
Opportunity. A product has an absolute advantage in a particular area. In this area, the product has a strong competitive opportunity.
Threat. An unfavorable factor in the development of a product in a certain environment. If you do not take decisive strategic action, this unfavorable trend will lead to a weakening of the company’s competitive position.

Understanding SWOT

Analyzing these four quadrants provides the goal of analysis for the future development of corporate strategy, finding areas where it is beneficial to strengthen and compensate for weaknesses, or a combination of applications such as using internal strengths to counteract external threats and external opportunities to eliminate internal weaknesses.

Strengths are those that are unique to your company and are a force you can control!

Find the best way to think

What are your strengths compared to your peers?
Which companies offer services, products and processes that are successful?
What soft strengths does the company have? Such as knowledge, Know how, relationships, skills, reputation, etc.
What hard strengths does the company possess? Such as quality of customer, superior technology, excellent equipment, large capital, etc.

Weaknesses

Weaknesses are those factors that weaken your company! You must make these Weaknesses disappear. If you want to stay competitive, you have to make those Weaknesses go away, or at least reduce the damage they can do to you!

Identify weaknesses

Are there any communication gaps or barriers between teams?
Is the company in a good location?
Are there any improvements to the company’s products, services and processes?
Are there any competitive advantages in projects related to the company that you are not currently undertaking?
What are the software and hardware resources that the company currently lacks? For example, capital, human resources, technology, equipment, etc.

Opportunities

External factors that help your company grow due to industrial progress and environmental changes!

Thinking Directions for Evaluating Opportunities

Is your industry growing? Do your customers speak highly of your company?
What are some future activities or events that could help your company grow?
Is your company’s industry in a growth trend? Will this trend help customers pay more attention to your company in the future?
Are there any new government regulations coming out or being lifted that will help your industry in a positive way?

Threats

Threats are external factors that are beyond your control. You can take precautions to face emergencies and reduce damage and injury.

Be prepared for danger in times of peace

What market trends are occurring that will negatively impact your company?
Will future technological developments affect your profitable business model?
Will changes in consumer or user habits affect your industry?
Are there strong potential competitors ready to enter your market?
Are the partnerships upstream and downstream of your product chain and between your suppliers and you stable?

How to conduct a SWOT analysis?

Define the objectives of your SWOT analysis
Conduct the necessary research on your business, industry and market
Identify the strengths of your business
Identify the weaknesses of your business
Identify the potential opportunities for your business
Identify potential threats to your business
Develop a strategy and actions to address the issues in the SWOT
Prioritize the actions to be taken as an implementation plan

SWOT Analysis Examples

The figure below shows a SWOT Analysis example for the strengths and weaknesses of the renewable energy market.

SWOT Analysis example

SWOT Analysis Example 2 – Starbucks^*

Strengths – The Starbucks Group has strong profitability, with 2004 revenue exceeding $600 million.
Weaknesses – Starbucks is known for its continuous improvement and innovation. (Translator’s Note: It can be understood as the instability of the product line)
Opportunity – The launch of new products and services, such as the sale of coffee at the show.
Threats – rising costs of coffee and dairy products.

Starbucks SWOT Analysis

Edit Starbuck SWOT example

SWOT Analysis Example 3 – Nike^*

SWOT Analysis Example 3

Looking for a free, web-based SWOT Analysis tool?

Visual Paradigm Online Free Edition can be used to create SWOT quickly and easily. As a web-based SWOT analysis tool, it supports Windows, Mac OS and Linux. This SWOT analysis software has an intuitive SWOT editor that supports quick shape creation with list-based editor shapes. Although it is free, you can create unlimited charts and export the charts to various document and image formats such as PDF, PNG, GIF, SVG and JPG. Try it now! No registration required.