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What is SWOT Analysis?

SWOT Analysis is a strategy method that is used to evaluate the focus areas involved in a project or business for strategic planning. It is also known as a SWOT matrix and is an acronym for:

Strengths – Weaknesses – Opportunities – Threats

In order to create a SWOT Analysis, users must first ask questions and get answers, to be able to generate meaningful information to enter into the main four focus areas.

Internal and external factors

This powerful strategic tool is used to identify the internal and external factors that can affect your business or project. The internal factors are the strengths and weakness of the evaluation. Some examples of internal factors are financial resources, business location, assets and business processes. The external factors are the opportunities and threats. Some examples of external factors are the market, demographic and economic trends, competition and legal regulations.

A Business SWOT template

Drawing up of a SWOT Analysis will always start with a desired final objective. Therefore, an excellent tool which forms part of any strategic planning. Any preparation of strategic planning can require a great deal of research and sometimes will be very costly. You will find a short explanation of the four elements below:


The strengths of your business or project that can contribute to achieving your intended objectives. To determine what they are, the following questions could be asked:

Your Unique Selling Points?

Something you do better than your competitors?

Why do customers choose you over your competitors?

Are there any advantages do you offer your customers?

What influences the buying behaviour of your customers?

When formulating the strengths, it is important to approach these from an internal perspective as well as from the perspectives of the customer and the market. It is necessary to remain realistic.


These are weaknesses of your business or project that may have a negative effect on achieving the intended objectives. To determine what these weaknesses are, the following questions could be asked:

Factors that make you lose customers or market share?

Things that be avoided within the business or project?

Any improvements required by the business?

What are customers likely to see as your weaknesses?

They can be difficult questions to answer and the answers may be quite confronting. Have other and external people assess your weaknesses so that you can work on these.


There are times when certain opportunities present themselves for the business or project. To determine what these opportunities are, the following questions could be asked:

What are the opportunities for the business or project?

Interesting trends that the business or project could respond to?

The following matters might be of influence in some way, for example, technological developments, new hardware or software, changes in the market trends or new suppliers.


Possible obstacles that can negatively influence the business or project. To determine what these threats are, the following questions could be asked:

Can new technologies pose a threat to the business or project?

The financial situation of the business or project?

What possible obstacles can be identified for the business or project?

Can bad weather affect the business or project?

Do the identified weaknesses pose a threat to the business or project?

Practical SWOT tips

SWOT Analysis is a serious method. Ensure when you start to work on this, that there is a commitment from all interested parties. This is crucial to the follow-up of any development of strategic planning. See to it that the intended objectives are realistic and achievable so that people can still support them afterwards in terms of decisions and policies. In addition, the SWOT Analysis is often used to identify any areas for development. This is useful when it concerns any exploration of opportunities such as a feasibility study. A SWOT Analysis can contribute to any decision-making when there is a defined situation or objective that has been defined.

Benefits and limitations

The SWOT Analysis has a practical approach, which has the advantage that you can apply it anywhere at any time. It also helps to give direction (objective- and goal setting) and start the conversation about the possible further steps (priority, impact and resources). However, there are also limitations using this strategy method. By applying this method, you will get a “photo” of a certain moment in strategic planning. This can have consequences in the later stages of strategy deployment. In addition, it is how quick it can be established, which can lead to quick conclusions and sometimes misleading outcomes.

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