SWOT Analysis: Management Funda; Nov'07

What does it mean

SWOT Analysis is a powerful but simple strategic planning technique used for evaluating the Strengths, Weaknesses, Opportunities and Threats of any context - a business venture, a project or any activity. Strengths and weaknesses are often internal, while opportunities and threats often relate to external factors. Hence the SWOT Analysis is sometimes called Internal-External Analysis and the SWOT Matrix (refer below) is called an IE Matrix. This tool can even aid in your career planning by helping you utilize your talents, abilities and opportunities in the best possible way. How? Let’s find out!

How does one use SWOT

  • You need to start by defining a desired objective like choosing between two business ventures that you want to work on or determining your firm’s business strategy.

  • Then create a SWOT matrix as illustrated below. We have taken as an example here a small internet business that mostly employs contractors.

  • Strengths need to be maintained, built upon or leveraged. So maintain low overheads by changing pay structure to include performance bonus.
  • Weaknesses need to be remedied or stopped. We can consider implementing project planning system.
  • Opportunities need to be prioritized and optimized. Testing new market with one existing service would be a good idea.
  • Threats need to be countered or minimised. Maybe we can look at including contractors in performance based bonus schemes.
  • Next review your SWOT matrix in order to create an action plan to address each of the four areas. Determine what needs to be done on a priority basis or what is a better option between two options. Let’s consider our example.

  • You can then use another decision making tool to help you plan further.

Effectively using SWOT analysis

Some key points to remember while using SWOT Analysis are:-

  • It is easy to get lost in compiling lists rather than thinking about what is actually important in achieving objectives. If the desired end state is not defined, the participants doing SWOT analysis may have different end states in mind and the results will be ineffective.

  • SWOT also presents lists without prioritization. For example, weak opportunities may appear to balance strong threats. Just remember only SWOT items that produce valuable strategies are important.

  • SWOT analysis may limit the strategies considered. You might conclude that you have done adequate planning and ignore aspects like calculating ROI for alternate strategies.

  • SWOTs are sometimes confused with possible strategies. SWOTs are descriptions of conditions, while possible strategies define actions.


Where can I use it

You would be surprised to know that apart from using it for business planning there are many ways you can use SWOT analysis for professional and personal effectiveness.

To construct your own SWOT analysis for your career planning, examine your strengths and weaknesses. How can you capitalize on your strengths and overcome your weaknesses? What are the external opportunities and threats in your career field?  

Think of the times you wanted to change an existing practice. Wouldn’t SWOT analysis have helped you determine the best course of action? In fact it is a good way of involving other people in a change process. Or think of the times when you started a project and in the middle of the project encountered problems. If you had done a SWOT analysis identifying threats at the beginning you could possibly have avoided the problems.

People have found SWOT useful for determining strategic directions for their team and department. You are faced with umpteen situations where you have to choose between two options right? Next time you have to choose between 2 job applicants who both seem to fit the bill try using SWOT. I guess by now you have ideas of your own as to where you can use SWOT analysis. Happy analyzing!



  • SWOT analysis, http://en.wikipedia.org/wiki/SWOT_analysis.
  • Swinton, L, “How To Do A SWOT Analysis: Strategic Planning Made Easy”, http://www.mftrou.com/how-to-do-a-SWOT-analysis.html.
  • SWOT analysis, http://www.managementresources.org/universal.php?c=11&a=46.
  • S. Hansen,R and. and Hansen,K “Using a SWOT Analysis in Your Career Planning”, http://www.quintcareers.com/SWOT_Analysis.html.