Situation analysis: SWOT & PEST - MyLeanMBA Blog
Six Steps to a Strategic Situation Analysis with SWOT deepens understandings of the factors and uncovers relationships between them. Discover the Benefits of Situation Analysis for Business Success your business's strengths and weaknesses, and any opportunities and threats (SWOT) that. The SWOT Analysis method, developed by Albert Humphrey in the s, uses a broad-based approach to help a company develop strategic plans for the.
What Is the Relationship of the SWOT Analysis to Strategic Planning in Budgeting?
These indicate to an organization the strength of the business model, whether there are areas for improvement, and how well an organization fits the external environment.
An analysis on the mission of the business, the industry of the business and the stated goals required to achieve the mission.
An analysis on the Marketing strategy and the Marketing mix. An analysis on how effectively the business is achieving their stated mission and goals. An analysis on the products manufactured by the business and how successful it is in the market.
The main purpose of the competitor analysis is for businesses to analyze a competitor's current and potential nature and capabilities so they can prepare against competition. The competitor analysis looks at the following criteria: Businesses must be able to identify competitors within their industry. Identifying whether competitors provide the same services or products to the same customer base is useful in gaining knowledge of direct competitors.
Both direct and indirect competitors must be identified, as well as potential future competitors.
What Is the Connection between Situation Analysis and SWOT Analysis?
The competitor analysis looks at competitor goals, mission, strategies and resources. This supports a thorough comparison of goals and strategies of competitors and the organization. Predict future initiatives of competitors: An early insight into the potential activity of a competitor helps a company prepare against competition.Episode 139: Introduction to the SWOT Analysis: The Art of Conducting a Situational Analysis
Some of the important areas that a company analyzes includes: Quantity and frequency of purchase Income level of customer Collaborators[ edit ] Collaborators are useful for businesses as they allow for an increase in the creation of ideas, as well as an increase in the likelihood of gaining more business opportunities. Agencies are the middlemen of the business world.
When businesses need a specific worker who specializes in the trade, they go to a recruitment agency.
Relationships Between PEST and SWOT
Suppliers provide raw materials that are required to build products. There are 7 different types of Suppliers: Manufacturers, wholesalers, merchants, franchisors, importers and exporters, independent crafts people and drop shippers. Each category of suppliers can bring a different skill and experience to the company. Strengths often encompass resources, competitive advantages, the positive aspects of those within your workforce and the aspects related to your business that you do particularly well, focusing on all the internal components that add value or offer you a competitive advantage.
Business Analyst | Six Steps to a Strategic Situation Analysis with SWOT
Weaknesses - Factors that are within your control yet detract from your ability to obtain or maintain a competitive edge such as limited expertise, lack of resources, limited access to skills or technology, substandard services or poor physical location. Weaknesses encapsulate the negative internal aspects to your business that diminish the overall value your products or services provide.
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This category can be extremely helpful in providing an organizational assessment, provided you focus on an accurate identification of your company's weaknesses. Opportunities - Summary of the external factors that represent the motivation for your business to exist and prosper within the marketplace. These factors include the specific opportunities existing within your market that provide a benefit, including market growth, lifestyle changes, resolution of current problems or the basic ability to offer a higher degree of value in relation to your competitors to promote an increase in demand for your products or services.
One element to be aware of is timing. For example, are the opportunities you're catering to ongoing or is there a limited window of opportunity?
Threats - External factors beyond the control of your organization that have the potential to place your marketing strategy, or the entire business, at risk. The primary and ever-present threat is competition. However, other threats can include unsustainable price increases by suppliers, increased government regulation, economic downturns, negative press coverage, shifts in consumer behavior or the introduction of "leap-frog" technology that leaves your products or services obsolete.
Though these forces are external and therefore beyond your control, SWOT analysis may also aid in the creation of a contingency plan that will enable you to quickly and effectively address these issues should they arise.
Turning SWOT Analysis into a Strategic Plan Once you've established specific values related to your business offerings within the four quadrants of SWOT analysis, you can develop a strategic plan based on the information you've learned.