Strength weakness, Opportunities and Threat Analysis

1. SWOT ANALYSIS
Job Thomas
MBA (PT), sem-6
SMS, CUSAT
Feb 2013

2. WHAT IS SWOT?
 It is a planning tool used to identify Strengths,
Weaknesses, Opportunities and Threats involved in
a business.
 It is used as part of Strategic Planning Process
 A SWOT analysis generates information that is
helpful in matching an organization’s goals,
programs, and capacities to the social environment
in which they operate

3. SWOT
 Factors affecting an organization can usually be
classified as:
Helpful Harmful
 Internal factors
 Strengths (S) Strengths Weaknesses
 Weaknesses (W)
 External factors
 Opportunities (O) Opportunities Threats
 Threats (T)

4. SWOT
 Strengths- Internal attributes that
are helpful to the organization to
achieving its objective
 Weaknesses – Internal attributes
that are harmful to the organization
to achieving its objective
 Opportunities – External factors that help the
organization achieve its objective
 Threats - External factors that are harmful to the
organization to achieving its objective

5. STRENGTHS: INTERNAL FACTOR
 Strengths are positive tangible and
intangible attributes, internal to an
organization.
 They are within the organization’s
control
 Strengths are
 Things a business is good at
 A characteristic giving a business an
important capability
 Sources of clear advantage over rivals
 Distinctive competencies and resources
that will help the business achieve its
objectives

6. STRENGTHS
Examples Examples
 High market share  Technological
 Achieving economies leadership
of scale  Brand reputation
 High quality
 Protected IP
 Leadership &
 Distribution network
management skills
 Employee skills
 Financial resources
 Research and  High productivity
development  Flexibility of production
capabilities

7. STRENGTHS
Importance
 Strengths help to build up competitive advantage
and serve as a cornerstone of strategy
 Strengths should be protected and built upon.

8. INTEL – SWOT ANALYSIS
Favourable Unfavourable
Internal Strengths Weaknesses
• Strong market position • Customer
and brand image concentration
• Advanced
technological
capabilities
External Opportunities Threats
• Launch of Atom • Increasing
processor competition
• Partnerships and • Litigations
alliances
• Growing global
semiconductor market
• Expanding PC market

9. WEAKNESS- INTERNAL FACTOR
 Factors that are within an organization’s control that
detract from its ability to attain the core goal. In
which areas might the organization improve?
 Weaknesses are:
 A source of competitive disadvantage
 Things the business lacks or does poorly
 Factors that place a business at a disadvantage
 Issues that may hinder or constrain the business in
achieving its objectives

10. WEAKNESS
Examples Examples
 Low market share  Cash flow problems
 Inefficient plant
 Undifferentiated products
 Inadequate distribution
 Outdated technology
 Low productivity
 Poor quality
 Skills shortages
 Lack of innovation  De-motivated staff
 A weak brand name  Products at the decline
stage of product life cycle
 High costs

11. WEAKNESS
Importance
 Management should
seek ways to reduce or
eliminate weaknesses
before they are
exploited further by the
competition.
 Weakness should be
seen as areas for
improvement.

12. SWOT-ANALYSIS
APOLLO TYRES LTD
Favourable Unfavourable
Internal Strengths Weaknesses
•base in three countries with three • not invested in two and three
product brands
•Extensive distribution
wheeler tyre segment
•Leading player in commercial •In Africa, manufacturing facilities
vehicle segment are sub-optimal
•Ultra high performance in car tyre •Company unable to pass cost
segments in Europe
•Largest producerand exporter in escalations to customers
Indian car tyre segment
External Opportunities Threats
• first mover in truck & bus radial • slow downs in India economy
segments •Increased competitions from global players
•Apollo brand car tyres in Europe will • redundant capacities needing investments
make sizable leverage •Raw material price volatility
•Dunlop in Africa can explore more •Unpredictable political, economical and
geographical advantages currency fluctuations at S. Africa
•Market in A. America, Australia, •Decline in demand in Europe
Russia S-E Asia yet to be explored

13. OPPORTUNITIES – EXTERNAL FACTOR
 External attractive factors that
represent the reason for an
organization to exist and develop.
What opportunities exist in the
environment which will propel the
organization?
 Identify opportunities by their “time
frames”
 An opportunity is any feature of the
external environment which creates
positive potential for the business to
achieve its objectives.

14. OPPORTUNITIES
Examples Examples
 Technological  Cash flow problems
innovation  Undifferentiated products
 New demand
 Inadequate distribution
Market growth  Low productivity
 Skills shortages
 Demographic change
 De-motivated staff
 Social or lifestyle
 Products at the decline
change stage of product life cycle
 Government spending
programmes

15. SWOT-ANALYSIS
KINGFISHER AIRLINES
Favourable Unfavourable
Internal Strengths Weaknesses
•Strong brand value and reputation in • Still in RED (still to Break Even)
the minds of the consumer (An outstanding of 950crs only to oil marketing
•UB group as the parent company cost till may end )
•First Indian airline to have a new •High ticket pricing (KF First & Class)
fleet of planes •Tough competition from Indian as well as
•Quality service and innovation international players
•More than 80 destinations
•Less than 100 people (employees)
per aircrafts
External Opportunities Threats
• If able to survive for a couple • Falling demand
of years, then can have a big •Over capacity in the skies
market share •ATF prices
•Untapped International Markets •Economic slowdown
•Untapped cargo market •Infrastructure issues
•Expanding tourism business

16. THREATS – EXTERNAL FACTOR
 Threats are any external development that may hinder
or prevent the business from achieving its objectives

17. THREATS
Examples Examples
 New market entrants  Economic downturn
 Change in customer  Rise of low cost
tastes or needs production abroad
 Demographic change  Higher input prices
 Consolidation among  New substitute
buyers products
 New regulations  Competitive price
pressure

18. THREATS
Importance
 The organization may
prepare contingency
plans to address
threats.
 Classify them by their
“seriousness” and
“probability of
occurrence”.

19. SWOT-ANALYSIS
BJP PARTY
Favourable Unfavourable
Internal Strengths Weaknesses
•A strong support base with an •Poorly defined ideological position.
all-India presence •Inability to promote talent internally.
•Active support from a large •Lack of creativity and intellectual depth
worldwide base of supporters in the organization.
•A large number of fulltime •Internal contradictions and conflict of
workers spread across the interests within Sangh Parivar..
country •Top leadership is increasingly seen to
•Support of the vast network of be old and weak, physically as well as
RSS and related organizations politically
(Sangh Parivar) •Growing Infighting and Factionalism
•Absence of any credible
national political alternative
except Congress
•BJP is the only all-India level
political formation in the
ideological segment, which can
be loosely described as "Hindu
Nationalist Political Stream".

20. SWOT-ANALYSIS
BJP PARTY
Favourable Unfavourable
External Opportunities Threats
• The party is in power in three •There is an impression among general
states and in Centre. public that BJP is a sinking ship.
•The party is the main •A new generation of Congress leaders
opposition party in a large in the age group of 40 -55 is in control in
number of states. many states. This leadership is dynamic,
•There have been no major innovative and sharp.
charges of corruption against •The image of Sonia Gandhi has been
any minister of Central improving. She is often seen as better,
Government. younger and more dynamic alternative.
•Party has substantial financial •Rising unemployment is leading to
resources at its command. frustration among youth. Party is being
•The number of people who are seen as pro-rich, pro-multinational, anti-
inclined to be pro-Hindutva is small-business, anti-small-industry. This
increasing almost everyday. image combined with large
•Sonia Gandhi's Italian descent unemployment can wreak havoc.
makes her unacceptable to
many Indians.

21. POTENTIAL USE OF SWOT ANALYSIS
 Set Objectives– defining what the organization is
intending to do
 Environmental Scanning– internal appraisals of the
organizations SWOT, this needs to include an
assessment of the present situation as well as a
portfolio of products/ services and an analysis of the
product/ service life cycle
 Analysis of existing strategies, this should determine
relevance from the results of an internal/external
appraisal. This may include gap analysis which will look
at environmental factors.
 Strategic issues defined– key factors in the
development of a corporate plan which needs to be
addressed by the organization

22. POTENTIAL USE OF SWOT ANALYSIS
 Develop new/revised strategies– revised analysis
of strategic issues may mean the objectives need to
change
 Establish critical success factors– the
achievement of objectives and strategy
implementation
 Preparation of operational, resource, projects
plans for strategy implementation
 Monitoring results– mapping against plans,
taking corrective action which may mean amending
objectives/strategies

24. SWOT MATRIX
Strength Weakness
GOOD NOW BAD NOW
Maintain, build, leverage Remedy, stop
Opportunity Threat
GOOD FUTURE BAD FUTURE
Prioritize, optimize Counter

25. ANY QUESTIONS?

26. THANKYOU FOR YOUR KIND
ATTENTION