SWOT Analysis means simply to examine: Strengths, Weaknesses, Opportunities, and thus to conduct an analysis of a product, organisation or the possible outcomes of a potential strategy via these criteria.
The great attraction of the SWOT analysis is the simplicity of the concept with headings that layout a solid framework for reviewing the position and direction of a company, product, project or a person.
It can provide insights into the internal and external factors that need to be considered in the decision making process.
The great weakness of SWOT is that it is only as useful or powerful as the context in which it is conducted and applied. Conducted in isolation it is a meaningless exercise. It is sometimes even referred to as a “Significant Waste of Time.”
However, used as a tool for developing a big picture perspective of the major ideas that impact success and issues that can lead to failure, and as longs the output of the analysis subsequently feeds into a detailed and structured strategic review or detailed evaluation and analysis, it can be very useful.
SWOT analysis emerged during research into the failure of long range corporate planning, conducted at Stanford Research Institute from 1960-1970.
During this period corporate planning was the current “big idea” (or fad) that consumed the corporate world at that time. Most companies had expensive teams of long-range strategic planners. Trouble was it didn’t work!
It didn’t work because management teams just didn’t buy into nor agree nor support and commit to the long-range plans. This was especially true where these long-range plans involved any form of significant change!
I find it particularly ironic, if not amusing, that one of the key findings if this research was that strategic planning should be conducted by the CEO and corporate directors and “fed down” into the organisation. The very centralised command control that is now so ill equipped to handle the current environment of constant change.
I find it even more ironic that this tactical and limited tool was conceived as a tool to get management teams engaged in the basics of an embryonic change management process.
As a tactical tool and used as part of a wider process and used in conjunction with other tools, SWOT is a valuable technique.
I have included below links to some extensive resources that will show you eveything you need to know about uses and applicains of SWOT.