Business Strategy: SWOT Analysis

Decent Essays
To answer question 1, an analysis of the business performance, and question 2, an analysis of business strategy: SWOT analysis
SWOT analysis is a tool that is used to identify the strategic positioning of the company. It does this by identifying the strengths, weaknesses, opportunities and threats facing a business, which can then be summarised in table form and used for management information [Kaplan Publishing UK, 2015, p.91]. An example of SWOT analysis is below.
• What the company is doing well at and what resources are fruitful? Weaknesses:
• What the company is doing poorly at, and what resources are in short supply?

• What the company could benefit from in the external environment? Threats:
• What the company needs to protect itself against in the external environment?

[Kaplan, n.d.]
There are however limitations of SWOT analysis, for example, the SWOT analysis can give a number of strengths, weaknesses, threats and opportunities, but what the SWOT does not do is give a solution as to which are most important to the success of the business. There are also opportunities whereby a strength could also be a weakness, and the SWOT analysis does not give a solution to this problem [Queensland government, n.d.].
To answer question 2, a review of the business strategy: Porter’s Five Forces
…show more content…
Secondly, the performance of the entity is based on historical data and therefore some of the industry figures used as a benchmark could be out of date. Finally, if the ratios calculated for the entity are used for comparison against industry norms, the norms will contain many companies each different sizes and therefore might not be a reliable comparison to use as a benchmark for
Get Access