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MGT

MGT

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Published by Scha Yayang

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Published by: Scha Yayang on Jun 03, 2010
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UNIVERSITI TEKNOLOGI MARA
DIPLOMA IN ACCOUNTANCY
DEFINITION OF SWOT &EXAMPLE
NAME : SHAHRIDAH BINTI SAIDIHLECTURER NAME :MATRIX NO. : 2008511033IC NO. : 900201125138GROUP : ACD3A2COURSE : MGT 215
 
Strengths, Weaknesses,Opportunities, and Threaths(SWOT) Analysis
SWOT
is an abbreviation for
Strengths, Weaknesses,Opportunities and Threats.
The SWOT involves analysingthe strengths (
S
) and weaknesses (
W
) of the business’s internalfactors and the opportunities (
O
) and threats (
T
) of its externalfactors of performance. SWOT analysis is an important tool forauditing the overall strategic position of a business and itsenvironment. It is the first stage of planning and helpsmarketers to focus on key issues.
 
 The following lists show theSOWT:
Strengths: attributes of the person or company thatare helpful to achieving the objective.
Weaknesses: attributes of the person or company thatare harmful to achieving the objective.
Opportunities:
external 
conditions that are helpful toachieving the objective.
Threats:
external 
conditions which could do damage tothe objective.
In SWOT, strengths and weaknesses are internal factors:For example: A
strength
could be:
 Your specialist marketing expertise.
A new, innovative product or service.
Location of your business.
Quality processes and procedures.
Any other aspect of your business that adds value to yourproduct or service.A
weakness
could be:
Lack of marketing expertise.
Undifferentiated products or services (i.e. in relation to yourcompetitors).
 
Location of your business.
Poor quality goods or services.
Damaged reputation.In SWOT, opportunities and threats are external factors:For example: An
opportunity
could be:
A developing market such as the Internet.
Mergers, joint ventures or strategic alliances.
Moving into new market segments that offer improved profits.
A new international market.
A market vacated by an ineffective competitor.A
threat
could be:
A new competitor in your home market.
Price wars with competitors.
A competitor has a new, innovative product or service.
Competitors have superior access to channels of distribution.
 Taxation is introduced on your product or service.
Example how SWOT can be used to create a strong businessstrategy :
McDonald states that the
“SWOT device…whilst potentially a very powerful,analytical device is rarely used effectively” 
. Moreover, he recommends using asummary from the marketing audit to arrive at a good SWOT as well as keeping itfocused on the critical factors only and to maintain a list of differential strengthsand weaknesses in comparison to competitors, focusing mainly on competitiveadvantages. Additionally, only critical external opportunities and threats should belisted with a focus on the real issues. Finally, the reader of the SWOT analysisshould be left with the main issues encompassing the business to the extent thatthey are able to derive and develop marketing objectives from them. A
“good SWOT analysis is characterized by the rigorous process of analysis, whichreduces the number of external and internal issues to those that are of paramount importance.” 
At the end of the analysis, the organisation is left with reasons behindtheir choices as well as their potential impacts, which provides them with astronger basis from which to form future strategic decisions.

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