What is a SWOT analysis?

A SWOT analysis is a strategic tool used to identify an organization's Strengths, Weaknesses, Opportunities, and Threats. This framework allows organizations to assess both internal factors (strengths and weaknesses) and external factors (opportunities and threats) that can impact their journey. The process involves analyzing strengths such as resources and capabilities that give the organization an advantage in the marketplace, exploring weaknesses that may hinder performance, identifying opportunities in the environment that the organization can capitalize on, and recognizing threats that could pose challenges or obstacles to success.

Utilizing this analytical method encourages strategic planning and decision-making by helping organizations to make informed choices based on a holistic view of their current position and potential future scenarios. By focusing on these four critical aspects, companies can better align their strategies with their capabilities and market realities, leading to improved performance and competitiveness.