Chapter II - Internal and Resource

Analysis

SWOT Analysis
Resource analysis

Jude Bringuela
Internal Analysis
An internal analysis is the thorough
examination of a
company's internal components, both tangible
and intangible, such as resources, assets and
processes.
• Any analysis of company strengths
should be market oriented/customer
focused because strengths are
only meaningful when they assist the
firm in meeting customer needs.
• Weaknesses should also be examined
from a customer perspective because
customers often perceive weaknesses
that a company cannot see.
Resource Analysis
Analyze and filter the resources to keep the right amount of skills and
competencies at your firm.
 Resource

The resources are the means by which an

organization generates value. A resource can
be an asset, skill, process or knowledge
controlled by an organization.
4 categories of
Resources
- Physical resources
which include plant and machinery, land and
buildings, production capacity, etc.
- Financial resources
which include capital, cash, debtors, creditors, etc.
- Human resources
which include knowledge skills, adaptability of
human resources
- Intellectual capital
which is an intangible resource and includes the
knowledge that has been captured in patents, brands,
business systems customer databases and relationships
with partners.
• A good starting point to identify company resources is to look at tangible,
intangible and human resources.
• Intangible resources are largely invisible, but over time become more
important to the firm than tangible assets because they can be a main
source for a competitive advantage.
 • SWOT stands for strengths,
weaknesses, opportunities and
threats. SWOT analysis is a widely
used framework to summaries a
company’s situation or current
position.
SWOT • Factors internal to the firm usually can
Analysis be classified as strengths (S) or
weaknesses (W), and those external
to the firm can be classified as
opportunities (O) or threats (T). It is
an instrument within strategic
planning. When combined with
dialogue it is a participatory process.
 • Strengths Strength is something a
company possesses or is good at
doing. They are within the
SWOT: organization’s control.
• Examples include a skill, valuable
Internal asset, alliances, or cooperative
Factors ventures, experienced sales force,
easy access to raw materials, brand
reputation, etc.
 • Weaknesses A weakness is something
a company lacks or does
SWOT: poorly. Factors that are within an
organization’s control that detracts
Internal from its ability to attain the core goal.
• Examples include lack of skills or
Factors expertise, deficiencies in assets,
inferior capabilities in functional areas,
etc.
 • Opportunities an area of “need” in
which a company can perform
profitably. These are external
attractive factors that represent the
reason for an organization to exist
SWOT: and develop.
• Examples include market growth;
External favorable changes in competitive or
regulatory framework,
Factors technological developments or
demographic changes, increase in
demand, opportunity introduce
products in new markets, turning
R&D into cash by licensing or selling
patents etc.
 • Threats A threat is a major unfavorable
situation in a firm’s environment. These
are challenges posed by an
unfavorable trend or development that
would lead to deterioration in
SWOT: profits/ sales.
• Examples include increase in competition,
External slow market growth, increased power of
buyers or suppliers, changes in
Factors regulation, etc. These factors pose serious
threats to company because they may
cause lower sales, higher cost of
operations, higher cost of capital, inability
to make break-even, shrinking margins or
profitability etc.
Thank you!