What does SWOT analysis evaluate?

SWOT analysis is a strategic planning tool used to evaluate the internal and external factors that can impact an organization’s objectives. The acronym stands for Strengths, Weaknesses, Opportunities, and Threats.

Strengths refer to the internal characteristics of an organization that provide advantages over competitors, such as unique resources or capabilities. Weaknesses are internal factors that may hinder the organization's performance, such as skills gaps or resource limitations. Opportunities are external trends or changes that could be advantageous if leveraged correctly, like market growth or technological advancements. Lastly, Threats are external challenges or obstacles that could negatively affect the organization, such as increased competition or regulatory changes.

By assessing these four areas, organizations can develop a comprehensive understanding of their current situation and formulate appropriate strategies that capitalize on their strengths and opportunities while addressing their weaknesses and threats. This holistic evaluation informs decision-making and enhances problem-solving capabilities.