Define SWOT Analysis
We will have the definition of a swot analysis in this section. Further down we will have SWOT analysis with example as well to help you fully understand the meaning of SWOT analysis.
The Swot Definition is the meaning that is referred to when a person want to analyse a person or a company to determine various aspects about the person/company, especially in business terms or to determine their financial worth or attractiveness.
SWOT is an acronym that stands for:
What is Strength in Swot Analysis?
Strength in SWOT analysis refers to an internal issue. It is a thing that a person or a company has full control over and can make changes. Some common examples of strengths in a company may be issues such as the workforce (The people you have working for the company). For instance, if a company has competent employees who have worked with a company for a while and understand all aspects of the business operations, then they can be considered as strength to the company. The company can use this workforce to propel itself to greater heights. OR at least, they can rely on the benefits accrued from this workforce when making both short and long term plans.
Weakness in Swot Analysis
Just like the strengths of a company mentioned in the previous section, the weaknesses of a company are also internal to the company and the company has full control over the weaknesses of the company. Some examples of weaknesses can be issues such as unqualified employees. This is an issue that a company has full control over. To change such an issue a company can either lay off the unqualified stuff, or invest in their education to ensure they are qualified for certain aspects of the business requirements. Also, a company may lack in required funds to engage in expansion or change of technology at some point in time. Such an issue will hamper any plans the company has to expand and to effectively compete with its industry rivals.
Opportunities in SWOT Analysis
Opportunities are a matter that is external to the company and the company has little to no control over these matters. For opportunities, a company can take advantage of available matters in the market to grow its business or to profit the business either in the short term or in the long run. An instance of an opportunity may be weak competitors or financially struggling competitors. If a company has struggling rivals, then it can take advantage of this aspect by promoting its products aggressively knowing very well that the competitors cannot match their aggressiveness and will thus eat up more of their market share. Also, the business can engage in promotions where it can offer discounts or reduced prices to blow the competition out of the waters.
Threats in SWOT analysis
Threats in SWOT analysis are also an external matter and the company has little to no control over these external matters. Examples of threats to a company may be in the form of competitors joining the industry or acquiring new investments that will make the more competitive in the industry and potentially have the ability to eat up some of the company’s market share. Another example of a threat may be issues that threaten the survival of a business in the long run. For instance, a gasoline car manufacturing company is facing a threat with climate change issues and calls for green energy threatening the survival of such production in the long run. For such factors, the company has little to no control over such matters and can only adapt with the situation, possibly evolve with the market trends and needs.
SWOT Analysis Template
Normally, the presentation of a SWOT analysis takes the form of a 2×2 grid with Strengths and weaknesses (Internal matters) at the top and Opportunities and Threats (External matters) at the bottom.
Examples of issues that can be included in such a 2×2 grid include:
Strengths: Things a company/person does very well; unique resources that a company has access to; what other people or rivals see as your strengths.
Weaknesses: What are your business rivals better than you that you can possibly emulate or improve on? What are you doing that needs to be improved? What resources are you or your business lacking?
Opportunities: What opportunities in the market are present that you can exploit? How can you use your strength to benefit yourself or your company? What trends have you noticed that you can take advantage of to benefit the company?
Threats: What are your business rivals doing that directly or indirectly threaten your business well-doing either in the short term or in the long term? How are your weaknesses potentially exposing your business to either your rivals or possibly hampering its future prospects?
Importance of Swot Analysis
Doing a SWOT analysis is immensely beneficial to you or your company. Some of the benefits include:
- A SWOT analysis will enable you to prioritize your work and to be able to grow your business effectively. Therefore, it presents you with a solid business strategy for growth of your business.
- A SWOT Analysis gives you a reality check and enables you to have new perspectives about you or your business that you can greatly benefit from. For instance, It enables you to look at your business from a new direction such as a rival’s eyes, an employee’s eyes, a potential business partner’s eyes or a government’s eyes. Such perspectives will enable you point out all the issues that affect a company, what you can take advantage of and what needs improving.
Swot Analysis of a company
A SWOT analysis of a company involves analysing a business to determine all the factors affecting the business. It involves finding out the strengths of the business, its weaknesses, the available opportunities that the business can take advantage of and the factors that threaten the business’s existence or survival.
The company founders and top management are the people who need to be most involved during this process. However, the process cannot be done by this group of people alone. The exercise needs a group of people who can bring different perspectives about the business. This group of people can include ordinary customers that are not affiliated to the business and the business will be able to obtain feedback on their business from the target customers’ perspectives.
If you are running a small business on your own, you can obtain views from a few trustworthy friends, trusted family members, and some of your regular customers. However, it is important to conduct the SWOT analysis regularly as the business landscape keeps changing and a business may be left behind with new trends and lack of evolution to adapt to the changing needs of the consumers.
Personal SWOT Analysis examples
Here we will discuss the swot analysis of a person
Similar to the previous section where we have discussed how to do a SWOT analysis of a company, a personal SWOT analysis involves evaluating your own self regarding your personal goals and career trajectory.
The goal of a personal SWOT analysis is to evaluate your past, the present and your future.
To determine a personal SWOT, you can check the following:
Strengths: What are you good at? What are your colleagues always coming to get assistance from you? What professional skills do you have? What is your experience in your career? What are the personal attributes you have that are good for your career?
Weaknesses: What do you struggle with? What skills do you lack? What personal attributes that hinder creation of fruitful relationships with your colleagues?
Opportunities: What skills do you have or can easily acquire to help you get a promotion or higher pay in your place of work? What skills do you have that the business needs that can make you more indispensable to the business?
Threats: What challenges can you see ahead of you that can threaten your career? What skills do you lack that will be needed in the near future in your workplace? Are there technologies that are in the market or being built that will possibly render your services obsolete in the near future?
In a personal SWOT analysis, honesty is the best attribute. In order to identify your weaknesses and the areas you need to improve on, you need to be honest about yourself and do not overestimate your abilities. You can get a second opinion from a neutral party or friend who can easily identify issues that you may miss about yourself.
SWOT Analysis for Amazon
- They have a strong brand name; a global e-commerce giant
- They have a strong brand evaluation; brand value of over $200 billion
- The business is customer oriented: Catering to many customers everyday inexpensively
- Differentiation and innovation; factors that have enabled Amazon to be successful
- Cost leadership: cost minimization by eliminating the need for physical retail stores
- They have the largest merchandize selection
- They have a huge number of third-party sellers
- Minimum pay per hour of over $15
- They have superior logistics and distribution systems.
- Have a huge market capitalization of over 1 trillion dollars making it a market leaders
- Going global while leveraging on local strategies that involve partnering with local businesses that best understand the local business culture.
- Amazon’s business model is easily imitable.
- Losing margins due to issues such as free shipping in some locations.
- Product flops such as fire phone
- Controversies such as tax avoidance
- Limited brick and mortar presence especially with goods that are not sellable online and their lack of retail stores.
- Declining consumer safety due to high third parties and inability to confirm product safety.
- The company over-depends on distributors
- The company has engaged in unfair use of third party data.
- The company still has new developing markets it can exploit
- The company can increase physical locations to compete against some big retailer stores
- The company can improve its technological policies and systems.
- The company can do more acquisitions
- Use of self-driving technology to improve delivery services.
- Controversies have dented the company’s image considerably.
- The company has been linked to exploitation of labour/poor labour practices
- Cybercrime has the ability to hugely affect the business due to its dependence on online platforms and systems that are easily targeted by hackers anonymously.
- Aggressive competition from companies such as eBay
- Imitation affects the company hugely.
- Increase in fake products being sold through its platforms.
- Fake reviews affecting the company’s brand and consumer trust
SWOT Analysis for Wal-Mart
- Global organizational size: the company is a global retail giant.
- Global supply chain: the business has an effective global supply chain.
- High efficiency of the supply chain: the company can boast of a working and highly effective supply chain to enable it to distribute its products.
- Specialized product rivals that are actively competing with the company
- The business model can easily be imitated.
- The company over-relies on thin profit margins and, therefore, needs to sell a lot of products to make huge profits.
- The company can expand to new markets, especially rapidly growing emerging markets.
- The company can work in improving quality standards hence improve its image as well.
- The company can make itself more competitive in the labour market by improving its labour practices.
- New trends such as healthy lifestyles are seeing a reduction in demands for goods sold by the company
- Online retailers such as Amazon and a host of other e-commerce companies competing with the company.
- Aggressive competition from its rivals on various segments of its product range.
SWOT Analysis Netflix
- The company has a strong brand name is a household name
- The company can easily adapt to changing trends.
- The company offers a segment of original movie content that are only available on the platform.
- The company has a global audience that is also affordable globally.
- The company lacks good customer care service.
- The company is over-reliant on the North American Market.
- Lack of original content from several countries mean that it can price its product highly in those regions.
- Limited copyright on some of its content limits its revenue potential.
- The company can easily expand due to its brand recognition coupled with demand for similar platforms.
- Ability to work on new marketing concepts and offer good customer care services.
- Its global presence can be solidified with strategic partnerships with local markets.
- Exclusive content enables it to bring in new product lines as well that can expand its portfolio and bring in new markets.
- Issues such as COVID-19 affect production of new content.
- Some government limitation in some region hamper their expansion potential
- Sharing of accounts limits growth of the subscriber base.
- Content piracy is a major issue with pirated work easily available online for free downloads.
Business Studies and Accounting Homework Help
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