What Is a SWOT Analysis?

by Barbara Thompson; Updated September 26, 2017

A SWOT analysis is a strategic planning technique that involves scanning the internal and external business environment to determine whether a specific goal is attainable and what needs to be involved in achieving that goal.

Strengths

The "S" in SWOT stands for strengths, internal factors that are favorable to achieving the desired outcome. Strengths may include product patents, trade secrets, exclusive access to resources and company reputation.

Weaknesses

The "W" in SWOT stands for weaknesses, internal factors that may interfere with achieving the desired result, including high overhead, lack of supplier relationships and poor reputation.

Opportunities

The "O" in SWOT stands for Opportunities; these are external factors that may help in reaching the desired outcome, including new technologies, increased customer demand and loosened regulations.

Threats

The "T" in SWOT stands for threats, external factors that may hinder the achievement of the desired goal; these include changes in customer preferences, intense competition in a particular market and governmental regulations.

Using the SWOT Analysis

Once a SWOT analysis has been completed, it should be reviewed to determine whether the desired outcome is feasible. Management should focus on how to capitalize on each strength and opportunity, and how to mitigate each weakness and threat.

About the Author

Barbara Thompson has a Bachelor's degree in Information Technology from Clayton State University and more than 10 years experience developing print and web-based training materials for various industries. For the last seven years, Barbara has worked in a public university system designing online college courses and developing training materials for faculty and students.