3.

Why the organizations analyze the internal strength and weakness and external
threat and opportunities. How and what managers are trying to solve problems &
exploit the opportunities available in the environment?

The process an organization analyze the internal strength and weakness and external
threat and opportunities is called SWOT analysis.
A situation analysis is often referred to by the acronym SWOT, which stands for strengths, weaknesses, opportunities,
and threats.
Essentially, a SWOT analysis is an examination of the internal and external factors that impact the organization and its
strategies. The internal factors are strengths and weaknesses; the external factors are opportunities and threats. A SWOT
analysis gives an organization a clear picture of the “situation” in which it operates and helps it identify which strategies to
pursue.
Internal factors
Strength and weakness include the resources and capability within the organization now.since the company has the most
control over internal factors..it can craft strategies and objectives to exploit strengths and address weaknesses.
Examples of internal factor include the following:

 Financial resources
 Technical resources and capabilities
 Human resources
 Product lines
All of these are controlled by the organization. Competitive positioning can also be a strength or a weakness. While
competitors’ strategies and tactics are external to the company, the company’s position relative to the competitors is
something that it can control.
External factors:
External factors include opportunities and threats that are outside of the organization.These are factors that the company
may be able influence—or at least anticipate—but not fully control. Examples of external factors include the following:

 Technology innovations and changes

 Competition
 Economic trends
 Government policies and legislation
 Legal judgments
 Social trends
While a company can control how it positions itself relative to the competition, it can’t control competitors’ actions or
strategies.
Benefits of SWOT Analysis
A SWOT analysis benefits organizations in two key ways:
Encourages Realistic Planning
Imagine a growing company that is able to attract new customers more easily than the competition because it has a strong
reputation and visible leader. These strengths should be considered and exploited in the strategy. Now imagine that the
company also has a poor history of delivering on customer commitments. If this weakness is not addressed,it will not only
make it difficult to retain customers but also likely damage the reputation of the company and its leader—which would
eliminate key strengths. By conducting a situation analysis, the company is more likely to consider both of these factors in its
planning.
Improve Ability to forecast Future Events
What’s the worst thing that could happen to your business? Most organizations can answer this question because they have
assessed the environment in which they operate. For instance, perhaps they know of pending legislation that
might adversely affect them. Or perhaps they recognize legal risks, or unique challenges from past economic cycles. By
considering threats and “worst-case scenarios” during the planning process, organizations can take steps to avoid them, or
minimize the impact if they do they occur.
Managers are trying to solve problems and exploit opportunities by using various tools and framework such a
- SWOT analysis
-Porter’s five forces
-PESTEL analysis etc.