Alternatives to swot analysis

Week Three Lecture

Chapter Five – Assessing the Company Itself

In Chapter Five we are introduced to a very important tool in business, referred to as the SWOT analysis. SWOT stands for strengths, weakness, opportunities, and threats. A SWOT analysis looks at both internal and external aspects. The strengths and weaknesses will apply to the internal part of the organization, whereas the opportunities and threats apply to the external part of the organization. One may use a SWOT analysis as a tool to look at the current situation of a company and evaluate the possibilities in forecasting the future. According to Goodrich (2013), “the SWOT analysis enables companies to identify the positive and negative influencing factors inside and outside of a company or organization” (Para 5). Below is a brief review of how to conduct a SWOT analysis.

· Strength – First, the company must identify what they are doing right. What is working for the company and helping the organization to meet its goals.

· Weakness – Second, the company needs to identify what areas need improvement. The ultimate goal is to take a weakness and turn it into a strength.

· Opportunities – Third, the organization needs to identify what opportunities are available that would help the company. As stated before, this typically comes from outside the company. It is an external element in which the company is seeking opportunities to help the business. This could entail working with new vendors, using new software, or expanding into new markets.

· Threats – Finally, the company must be aware of the threats that are out there. Threats are not the same as weakness, as many often confuse the two. A threat is something the company has no control over, but is aware it is there. For example, competition is a threat. A company cannot control what their competitors do, but need to be aware of them. Another threat could be a natural disaster. One can prepare with insurance, but you have no control over that. Another example might be economical situations in which the market shifts; again, there is little a company can do about this. All of these factors and many others can threaten a company. When it comes to threats, you cannot control them, but can have a strategic plan in place in terms of how to manage them.

Another important element in Chapter Five is identifying the competitive strength of the organization. Please take a look at Table 5.3, which highlights the competitive strength matrix. Another tool that is often used with organizations is the Value Chain Analysis. There are two parts to this analysis. The first is internal, in which the company identifies the various value added stages. This may include purchasing materials, selling and/or servicing the product, etc (Abraham, 2012). The second part looks at the external elements in terms of value added stages. This may include material received from a distributer, the manufacturer process, etc. (Abraham, 2012). Below are three videos that all relate to the Value Chain Analysis. The first is a dynamite video that helps explain Porter’s Value Chain Analysis. The two remaining are examples of a Value Chain analysis with Starbucks and Coke. Porter's Value Chain (Links to an external site.)Links to an external site.(http://youtu.be/hkisCzFHx80) A Behind the Scenes Look at Starbucks Global Supply Chain – Starbucks Coffee (Links to an external site.)Links to an external site.(http://youtu.be/ElYNhGbOTOQ) Coke value chain analysis (Links to an external site.)Links to an external site.(http://youtu.be/gN8bhTfwpdQ)