SWOT Analysis: Strengths, Weaknesses, Opportunities, Threats (2022)

What Is a SWOT Analysis?

SWOT stands for Strengths, Weaknesses, Opportunities, and Threats, and so a SWOT analysis is a technique for assessing these four aspects of your business.

SWOT Analysis is a tool that can help you to analyze what your company does best now, and to devise a successful strategy for the future. SWOT can also uncover areas of the business that are holding you back, or that your competitors could exploit if you don't protect yourself.

A SWOT analysis examines both internal and external factors – that is, what's going on inside and outside your organization. So some of these factors will be within your control and some will not. In either case, the wisest action you can take in response will become clearer once you've discovered, recorded and analyzed as many factors as you can.

In this article, video and infographic, we explore how to carry out a SWOT analysis, and how to put your findings into action. We also include a worked example and a template to help you get started on a SWOT analysis in your own workplace.

Why Is SWOT Analysis Important?

SWOT Analysis can help you to challenge risky assumptions and to uncover dangerous blindspots about your organization's performance. If you use it carefully and collaboratively, it can deliver new insights on where your business currently is, and help you to develop exactly the right strategy for any situation.

For example, you may be well aware of some of your organization's strengths, but until you record them alongside weaknesses and threats you might not realize how unreliable those strengths actually are.

Equally, you likely have reasonable concerns about some of your business weaknesses but, by going through the analysis systematically, you could find an opportunity, previously overlooked, that could more than compensate.

How to Write a SWOT Analysis

SWOT analysis involves making lists – but so much more, too! When you begin to write one list (say, Strengths), the thought process and research that you'll go through will prompt ideas for the other lists (Weaknesses, Opportunities or Threats). And if you compare these lists side by side, you will likely notice connections and contradictions, which you'll want to highlight and explore.

You'll find yourself moving back and forth between your lists frequently. So, make the task easier and more effective by arranging your four lists together in one view.

Draw up a SWOT Analysis matrix, or use our free downloadable template.

A SWOT matrix is a 2x2 grid, with one square for each of the four aspects of SWOT. (Figure 1 shows what it should look like.) Each section is headed by some questions to get your thinking started.

Figure 1. A SWOT Analysis Matrix.

Strengths
What do you do well?
What unique resources can you draw on?
What do others see as your strengths?

Weaknesses
What could you improve?
Where do you have fewer resources than others?
What are others likely to see as weaknesses?

Opportunities
What opportunities are open to you?
What trends could you take advantage of?
How can you turn your strengths into opportunities?

Threats
What threats could harm you?
What is your competition doing?
What threats do your weaknesses expose to you?

How to Do a SWOT Analysis

Avoid relying on your own, partial understanding of your organization. Your assumptions could be wrong. Instead, gather a team of people from a range of functions and levels to build a broad and insightful list of observations.

Then, every time you identify a Strength, Weakness, Opportunity, or Threat, write it down in the relevant part of the SWOT analysis grid for all to see.

Let's look at each area in more detail and consider what fits where, and what questions you could ask as part of your data gathering.

(Video) What is SWOT Analysis? Strength, Weaknesses, Opportunities, Threats

Strengths

Strengths are things that your organization does particularly well, or in a way that distinguishes you from your competitors. Think about the advantages your organization has over other organizations. These might be the motivation of your staff, access to certain materials, or a strong set of manufacturing processes.

Your strengths are an integral part of your organization, so think about what makes it "tick." What do you do better than anyone else? What values drive your business? What unique or lowest-cost resources can you draw upon that others can't? Identify and analyze your organization's Unique Selling Proposition (USP), and add this to the Strengths section.

Then turn your perspective around and ask yourself what your competitors might see as your strengths. What factors mean that you get the sale ahead of them?

Remember, any aspect of your organization is only a strength if it brings you a clear advantage. For example, if all of your competitors provide high-quality products, then a high-quality production process is not a strength in your market: it's a necessity.

Weaknesses

Weaknesses, like strengths, are inherent features of your organization, so focus on your people, resources, systems, and procedures. Think about what you could improve, and the sorts of practices you should avoid.

Once again, imagine (or find out) how other people in your market see you. Do they notice weaknesses that you tend to be blind to? Take time to examine how and why your competitors are doing better than you. What are you lacking?

Be honest! A SWOT analysis will only be valuable if you gather all the information you need. So, it's best to be realistic now, and face any unpleasant truths as soon as possible.

Opportunities

Opportunities are openings or chances for something positive to happen, but you'll need to claim them for yourself!

They usually arise from situations outside your organization, and require an eye to what might happen in the future. They might arise as developments in the market you serve, or in the technology you use. Being able to spot and exploit opportunities can make a huge difference to your organization's ability to compete and take the lead in your market.

Think about good opportunities that you can exploit immediately. These don't need to be game-changers: even small advantages can increase your organization's competitiveness. What interesting market trends are you aware of, large or small, which could have an impact?

You should also watch out for changes in government policy related to your field. And changes in social patterns, population profiles, and lifestyles can all throw up interesting opportunities.

Threats

Threats include anything that can negatively affect your business from the outside, such as supply-chain problems, shifts in market requirements, or a shortage of recruits. It's vital to anticipate threats and to take action against them before you become a victim of them and your growth stalls.

Think about the obstacles you face in getting your product to market and selling. You may notice that quality standards or specifications for your products are changing, and that you'll need to change those products if you're to stay in the lead. Evolving technology is an ever-present threat, as well as an opportunity!

Always consider what your competitors are doing, and whether you should be changing your organization's emphasis to meet the challenge. But remember that what they're doing might not be the right thing for you to do. So, avoid copying them without knowing how it will improve your position.

Be sure to explore whether your organization is especially exposed to external challenges. Do you have bad debt or cash-flow problems, for example, that could make you vulnerable to even small changes in your market? This is the kind of threat that can seriously damage your business, so be alert.

(Video) SWOT analysis - Strengths Weaknesses Opportunities Threats

Tip:

Use PEST Analysis to ensure that you don't overlook threatening external factors. And PMESII-PT is an especially helpful check in very unfamiliar or uncertain environments.

Frequently Asked Questions About SWOT

1. Who Invented SWOT Analysis?

Many people attribute SWOT Analysis to Albert S. Humphrey. However, there has been some debate on the originator of the tool, as discussed in the International Journal of Business Research.

2. How Do SWOT Analysis and the TOWS Matrix compare?

While SWOT analysis puts the emphasis on the internal environment (your strengths and weaknesses), TOWS forces you to look at your external environment first (your threats and opportunities). In most cases, you'll do a SWOT Analysis first, and follow up with a TOWS Matrix to offer a broader context.

3. What Are the Biggest SWOT Analysis Mistakes?

  • Making your lists too long. Ask yourself if your ideas are feasible as you go along.
  • Being vague. Be specific to provide more focus for later discussions.
  • Not seeing weaknesses. Be sure to ask customers and colleagues what they experience in real life.
  • Not thinking ahead. It's easy to come up with nice ideas without taking them through to their logical conclusion. Always consider their practical impact.
  • Being unrealistic. Don't plan in detail for opportunities that don't exist yet. For example, that export market you've been eyeing may be available at some point, but the trade negotiations to open it up could take years.
  • Relying on SWOT Analysis alone. SWOT Analysis is valuable. But when you use it alongside other planning tools (SOAR, TOWS or PEST), the results will be more vigorous.

SWOT Analysis: Strengths, Weaknesses, Opportunities, Threats (2)

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(Video) Business strategy - SWOT analysis

How to Use a SWOT Analysis

Use a SWOT Analysis to assess your organization's current position before you decide on any new strategy. Find out what's working well, and what's not so good. Ask yourself where you want to go, how you might get there – and what might get in your way.

Once you've examined all four aspects of SWOT, you'll want to build on your strengths, boost your weaker areas, head off any threats, and exploit every opportunity. In fact, you'll likely be faced with a long list of potential actions.

But before you go ahead, be sure to develop your ideas further. Look for potential connections between the quadrants of your matrix. For example, could you use some of your strengths to open up further opportunities? And, would even more opportunities become available by eliminating some of your weaknesses?

Finally, it's time to ruthlessly prune and prioritize your ideas, so that you can focus time and money on the most significant and impactful ones. Refine each point to make your comparisons clearer. For example, only accept precise, verifiable statements such as, "Cost advantage of $30/ton in sourcing raw material x," rather than, "Better value for money."

Remember to apply your learnings at the right level in your organization. For example, at a product or product-line level, rather than at the much vaguer whole-company level. And use your SWOT analysis alongside other strategy tools (for example, Core Competencies Analysis), so that you get a comprehensive picture of the situation you're dealing with.

"How to Use SWOT" video. Click here to view a transcript.

A SWOT Analysis Example

Imagine this scenario: a small start-up consultancy wants a clear picture of its current situation, to decide on a future strategy for growth. The team gathers, and draws up the SWOT Analysis shown in Figure 2.

Figure 2. A Completed SWOT Analysis.

Strengths
What do you do well?
What unique resources can you draw on?
What do others see as your strengths?

Weaknesses
What could you improve?
Where do you have fewer resources than others?
What are others likely to see as weaknesses?

  • We are able to respond very quickly as we have no red tape, and no need for higher management approval.
  • We are able to give really good customer care, as the current small amount of work means we have plenty of time to devote to customers.
  • Our lead consultant has a strong reputation in the market.
  • We can change direction quickly if we find that our marketing is not working.
  • We have low overheads, so we can offer good value to customers.
  • Our company has little market presence or reputation.
  • We have a small staff, with a shallow skills base in many areas.
  • We are vulnerable to vital staff being sick or leaving.
  • Our cash flow will be unreliable in the early stages.

Opportunities
What opportunities are open to you?
What trends could you take advantage of?
How can you turn your strengths into opportunities?

Threats
What threats could harm you?
What is your competition doing?
What threats do your weaknesses expose to you?

  • Our business sector is expanding, with many future opportunities for success.
  • Local government wants to encourage local businesses.
  • Our competitors may be slow to adopt new technologies.
  • Developments in technology may change this market beyond our ability to adapt.
  • A small change in the focus of a large competitor might wipe out any market position we achieve.

As a result of the team's analysis, it's clear that the consultancy's main strengths lie in its agility, technical expertise, and low overheads. These allow it to offer excellent customer service to a relatively small client base.

The company's weaknesses are also to do with its size. It will need to invest in training, to improve the skills base of the small staff. It'll also need to focus on retention, so it doesn't lose key team members.

There are opportunities in offering rapid-response, good-value services to local businesses and to local government organizations. The company can likely be first to market with new products and services, given that its competitors are slow adopters.

(Video) SWOT Analysis "Strengths, Weaknesses, Opportunities and Threats"

The threats require the consultancy to keep up-to-date with changes in technology. It also needs to keep a close eye on its largest competitors, given its vulnerability to large-scale changes in its market. To counteract this, the business needs to focus its marketing on selected industry websites, to get the greatest possible market presence on a small advertising budget.

Note:

It's also possible to carry out a Personal SWOT Analysis. This can be useful for developing your career in ways that take best advantage of your talents, abilities and opportunities.

SWOT Analysis Infographic

Click on the image below to see SWOT Analysis represented in an infographic:

Key Points

SWOT Analysis helps you to identify your organization's Strengths, Weaknesses, Opportunities, and Threats.

It guides you to build on what you do well, address what you're lacking, seize new openings, and minimize risks.

Apply a SWOT Analysis to assess your organization's position before you decide on any new strategy.

Use a SWOT matrix to prompt your research and to record your ideas. Avoid making huge lists of suggestions. Be as specific as you can, and be honest about your weaknesses.

Be realistic and rigorous. Prune and prioritize your ideas, to focus time and money on the most significant and impactful actions and solutions. Complement your use of SWOT with other tools.

Collaborate with a team of people from across the business. This will help to uncover a more accurate and honest picture.

Find out what's working well, and what's not so good. Ask yourself where you want to go, how you might get there – and what might get in your way.

Download Template

FAQs

What are examples of strengths weaknesses opportunities and threats? ›

Strengths and weaknesses are internal to your company—things that you have some control over and can change. Examples include who is on your team, your patents and intellectual property, and your location. Opportunities and threats are external—things that are going on outside your company, in the larger market.

What is strength and weakness in SWOT analysis? ›

Strengths (S) and weaknesses (W) refer to internal factors, which are the resources and experience readily available to you. These are some commonly considered internal factors: Financial resources (funding, sources of income and investment opportunities) Physical resources (location, facilities and equipment)

What are the 4 characteristics of SWOT? ›

The four elements of the SWOT analysis are Strengths, Weaknesses, Opportunities and Threats.

What are 4 examples of opportunities? ›

What are some examples of opportunities?
  • Get help on projects.
  • Propose working groups.
  • Get testers for new ideas or products.
  • Create a team to work on an idea you have.
  • Share your expertise or best practices in a particular field.

What are 5 examples of weaknesses? ›

Examples of Weaknesses.
  • Self-criticism.
  • Shyness.
  • Lack of knowledge of particular software.
  • Public speaking.
  • Taking criticism.
  • Lack of experience.
  • Inability to delegate.
  • Lack of confidence.

What are SWOT threats examples? ›

9 examples of threats in a SWOT analysis
  • Social perception. With the rise of social media, consumers are increasingly aware of the business practices of the companies they support. ...
  • Natural disasters. ...
  • Technological changes. ...
  • Legislation. ...
  • Competition. ...
  • Globalization. ...
  • Data security. ...
  • Rising costs.

What are examples of strength? ›

Some examples of strengths you might mention include:
  • Enthusiasm.
  • Trustworthiness.
  • Creativity.
  • Discipline.
  • Patience.
  • Respectfulness.
  • Determination.
  • Dedication.

What is strength and weakness with example? ›

Strength: Quick-learner and self-motivated person. Weakness: My weakness is over thinking. My strengths->are I like to learn new things which can help in to grow in future and I am self motivated also with that I always try to think in positive way for better outcome.

What are strengths & weaknesses? ›

Strengths are defined as character traits or skills that are considered positive. Strengths include knowledge, attributes, skills, and talents. Weaknesses are just the opposite. Weaknesses are defined as character traits or skills that are considered negative or not as well developed.

What are the 5 C's of a SWOT analysis? ›

The 5 C's stand for Company, Collaborators, Customers, Competitors, and Climate. These five categories help perform situational analysis in almost any situation, while also remaining straightforward, simple, and to the point.

What are the 3 C's in SWOT analysis? ›

This method has you focusing your analysis on the 3C's or strategic triangle: the customers, the competitors and the corporation. By analyzing these three elements, you will be able to find the key success factor (KSF) and create a viable marketing strategy.

What are examples of threats? ›

Threats. Threats refer to factors that have the potential to harm an organization. For example, a drought is a threat to a wheat-producing company, as it may destroy or reduce the crop yield. Other common threats include things like rising costs for materials, increasing competition, tight labor supply.

What's an example of opportunity? ›

Examples of opportunity in a Sentence

When the opportunity came for her to prove that she could do the job, she was ready. I had the rare opportunity of speaking to the president. Studying abroad provides a great opportunity to learn a foreign language. There are fewer job opportunities this year for graduates.

What is opportunity give an example? ›

An opportunity is a situation in which it is possible for you to do something that you want to do. I had an opportunity to go to New York and study.

What are 3 good weaknesses? ›

Some skills that you can use as weaknesses include impatience, multitasking, self-criticism, and procrastination.

What are examples of business threats? ›

A threat to your business is typically external.
...
They can include:
  • Weather. ...
  • The economy. ...
  • Material shortage. ...
  • Your computer system is hacked. ...
  • Employment in your industry is strong. ...
  • Market demand dries up.

What are threats of a team? ›

Beware These Threats to Project Teamwork
  • Team members don't like each other. Most people can put aside personal differences and function effectively in a team environment. ...
  • Team members don't respect each other. ...
  • Department leaders don't support the project.

What is a threat or opportunity? ›

We use the word "opportunity" to describe an upside risk with positive impacts, and "threat" is used for downside risks with negative consequences.

What are the 3 types of strengths? ›

Firstly, there are three primary types of strength:
  • Maximum – the greatest force that can be generated.
  • Explosive – maximum force generated in minimum time.
  • Muscular Endurance – force that can be exerted for sustained periods.

What is a weakness? ›

noun. the state or quality of being weak; lack of strength, firmness, vigor, or the like; feebleness. an inadequate or defective quality, as in a person's character; slight fault or defect: to show great sympathy for human weaknesses.

What are 4 types of strategies develop in SWOT analysis? ›

During SWOT analysis, organizations identify strengths, weaknesses, opportunities and threats (the four factors SWOT stands for) pertaining to organizational growth, products and services, business objectives and market competition.

What is the 5 component strategy? ›

These five elements of strategy include Arenas, Differentiators, Vehicles, Staging, and Economic Logic. This model was developed by strategy researchers, Donald Hambrick and James Fredrickson.

What are the 5 main components in situational analysis? ›

5C situation analysis example

A situational analysis should include the internal and external factors that affect a business, and a 5C approach may be the simplest. The 5Cs are company, customers, competitors, collaborators, and climate.

What is 4p strategy? ›

The four Ps are a “marketing mix” comprised of four key elements—product, price, place, and promotion—used when marketing a product or service. Typically, businesses consider the four Ps when creating marketing plans and strategies to effectively market to their target audience.

What is 4p framework? ›

The 4 Ps is one of the most popular marketing frameworks that businesses use. Also known as the marketing mix, the framework identifies the four main elements that are most crucial to customer acquisition: Product, Price, Promotion, and Place (see Figure 1).

What are the 3 C's when it comes to a successful brand? ›

Raise your voice and clearly articulate your brand message and values by following the 3 c's model to brand messaging: consistency, clarity and character.

How do you write a SWOT analysis example? ›

Use the following 8 steps to conduct a SWOT analysis.
  1. Decide on the objective of your SWOT analysis. ...
  2. Research your business, industry and market. ...
  3. List your business's strengths. ...
  4. List your business's weaknesses. ...
  5. List potential opportunities for your business. ...
  6. List potential threats to your business.

How do I create a SWOT analysis template in Word? ›

How to create a SWOT analysis in Word
  1. Open Word and create a new document. Open the Microsoft Word application on your computer. ...
  2. Insert a table. ...
  3. Design your chart. ...
  4. Label your quadrants with headings. ...
  5. Enter your SWOT text. ...
  6. Save your SWOT chart. ...
  7. Share your SWOT chart.
8 Apr 2022

What are the 6 types of threats? ›

The six types of security threat
  • Cybercrime. Cybercriminals' principal goal is to monetise their attacks. ...
  • Hacktivism. Hacktivists crave publicity. ...
  • Insiders. ...
  • Physical threats. ...
  • Terrorists. ...
  • Espionage.
25 Mar 2015

What are potential threats? ›

Potential threat means the possible exposure to harm or injury.

What are external threats in SWOT? ›

Threats are external factors that could cause problems for your business, such as changes to the market, a competitor's new advertising campaign, or new government policy. A SWOT analysis can help you identify threats and ways to counteract them, depending on your strengths and weaknesses.

What are the 10 opportunities? ›

Terms in this set (10)
  • #1. Create magic first!
  • #2. Identify challenges.
  • #3. Recommend solutions.
  • #4. Wash house.
  • #5. Educate your guest.
  • #6. Talk professionally.
  • #7. Color bar.
  • #8. Style experience.

What are potential opportunities? ›

a possible but not yet actual. b prenominal capable of being or becoming but not yet in existence; latent. 2 (Grammar) (of a verb or form of a verb) expressing possibility, as English may and might.

What is general opportunity? ›

noun, plural op·por·tu·ni·ties. an appropriate or favorable time or occasion: Their meeting afforded an opportunity to exchange views. a situation or condition favorable for attainment of a goal. a good position, chance, or prospect, as for advancement or success.

How do you describe opportunities? ›

Meaning of opportunity in English. an occasion or situation that makes it possible to do something that you want to do or have to do, or the possibility of doing something: Everyone will have an opportunity to comment.

How do you identify opportunity? ›

3 Ways to Identify Business Opportunities
  1. Identify Your Pain Points. When searching for potential market needs, start with yourself. ...
  2. Conduct Market Research. Another way to prove whether a business idea is viable is by conducting market research. ...
  3. Question Processes.
5 Apr 2022

How do you identify a opportunity? ›

8 ways to identify market opportunities
  1. Speak to prospects you've lost. ...or potential prospects full stop. ...
  2. Talk to current customers. ...
  3. Competitor analysis. ...
  4. Understand the market. ...
  5. Explore indirect opportunities. ...
  6. Look at environmental factors. ...
  7. Analyse foreign markets. ...
  8. Investigate other industries.
5 Sept 2019

› swot-analysis-opportunities-de... ›

SWOT Analysis Opportunities: Definition & Examples ... SWOT analysis is one of business analysis' most important tools. Through looking at the Strengths...
SWOT analysis has been used by businesses for years. But it is also useful on a personal level to identify strengths, weaknesses, opportunities and threats.
Do a personal SWOT analysis to understand your strengths and weaknesses, and the opportunities and threats you face, so you can plan for career success.

What are examples of strength? ›

Some examples of strengths you might mention include:
  • Enthusiasm.
  • Trustworthiness.
  • Creativity.
  • Discipline.
  • Patience.
  • Respectfulness.
  • Determination.
  • Dedication.

What are the strengths and opportunities? ›

A strength is a resource or capacity the organisation can use effectively to achieve its objectives. A weakness is a limitation, fault, or defect in the organisation that will keep it from achieving its objectives. An opportunity is any favourable situation in the organisation's environment.

What are the top 10 Weaknesses? ›

List of Weaknesses
  • Not taking criticism well.
  • Impatient.
  • Lazy.
  • Easily bored.
  • Procrastinate.
  • Persistent.
  • Takes things personally.
  • Strong willed.
19 Aug 2022

What are the 3 types of strengths? ›

Firstly, there are three primary types of strength:
  • Maximum – the greatest force that can be generated.
  • Explosive – maximum force generated in minimum time.
  • Muscular Endurance – force that can be exerted for sustained periods.

What are weaknesses in SWOT? ›

In SWOT analysis W stands for weaknesses are those characteristics of a business that gives disadvantage relative to others. Weaknesses are all those things you do not perform well. Swot weaknesses can prevent you from achieving company goals and objectives.

What are good weaknesses? ›

So as a recap, the four answers that you can give when being asked, what are your greatest weaknesses, are, I focus too much on the details, I've got a hard time saying no sometimes, I've had trouble asking for help in the past, and I have a hard time letting go of a project.

What are examples of threats? ›

Threats. Threats refer to factors that have the potential to harm an organization. For example, a drought is a threat to a wheat-producing company, as it may destroy or reduce the crop yield. Other common threats include things like rising costs for materials, increasing competition, tight labor supply.

What is strength and weakness with example? ›

Strength: Quick-learner and self-motivated person. Weakness: My weakness is over thinking. My strengths->are I like to learn new things which can help in to grow in future and I am self motivated also with that I always try to think in positive way for better outcome.

Videos

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2. SWOT-Analyse (Strengths, Weaknesses, Opportunities, Threats) 3 Beispiele von Tesla.
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