SWOT

To develop a profile of your organization, it must be examined inside and out. The common approach to this profiling is referred to as SWOT, which stands for Strengths, Weaknesses, Opportunities and Threats.

Internal environment

This profile scans various functional departments and business units, as well as corporate performance.

Strengths

Areas in which the organization holds superiority over its competitors. They can include such items as:

• Capital well-being
• Production efficiency
• Customer responsiveness
• Zero defects (quality control)

Weaknesses

Areas in which the organization lacks superiority over its competitors. They can include the same items as those listed under Strengths. By identifying areas that need improvement, managers can determine whether additional employees, departments or other resources should be diverted to these areas to strengthen the company.

External environment

This profile scans the industry and business environment outside the company or corporation.

Opportunities

This scan of the world beyond the organization's walls looks at elements of the environment that the company can capitalize on, based on what's happening within the industry.

Threats

Its competitors must be understood, and management should feel secure in that special niche it wants to carve out in the market.

Copyright © Marilyn Shaw and Merri Incitti

This page last updated November 1995

The ideas for a semester-long research project of a company are based on Strategic Management Project Modules in "Strategic Management An Integrated Approach," Third Edition, by Charles W. L. Hill and Gareth R. Jones, published by Houghton Mifflin, 1995. The suggestion to do this preliminary research on the Internet is ours.

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