The SWOT analysis is a diagnostic tool used by a variety of organizations from advertising agencies to clinical laboratories. This tool is commonly used within the framework of an overall strategic management initiative designed to enable the organization to develop and maintain a sustainable competitive advantage. The SWOT method examines an organization’s strengths, weaknesses, opportunities and threats. A clinical laboratory might choose to use a SWOT analysis to identify and take advantage of a variety of strengths and opportunities while also combating its weaknesses and threats.


Strengths consist of internal factors the organization may exploit in order to build a competitive advantage. These core competencies include those things that the organization does best. The organization’s strengths are what add value to the organization’s product or services. In a clinical laboratory setting, these strengths may include the existence of diagnostic equipment not available within a competitor’s laboratory. Or, the laboratory staff may possess a unique mixture of expertise not easily obtainable within the industry. A strong reputation or brand might also provide a strength for the organizations. These strengths add value to the services provided by the individual clinical laboratory and are not easily copied by competitors.


Weaknesses are also internal factors. These include any areas in which the organization should improve its processes, products and services. For example, if the clinical laboratory lacks expertise in a certain area, it may lose business to a competitor. Additionally, the failure of a clinical laboratory to obtain a patent on newly developed equipment may provide an opening to competitors to replicate its processes. In either situation, the competitor may use the lab’s weaknesses to its own advantage and surpass the organization, taking a greater share of the market.


Opportunities are external factors over which the organization has no control. These factors provide an opportunity for the organization to expand or grow. For a clinical laboratory, this may include the development of new technology that would improve efficiency within the organization. The clinical lab might also identify resources or a niche customer base of which no competitor has previously taken advantage.


Like opportunities, threats are external factors. Threats include a variety of factors including political, economic, social and technological threats that might be identified using a PEST analysis. For example, within a clinical laboratory setting, new regulatory legislation may require more stringent standards than previously required. The organization may be compelled to implement new processes and procedure to maintain compliance. Changing insurance plans might also lead to increasing costs for the organization.