SWOT Analysis and example.doc

SWOT Analysis and sample/benefits-of-swot-analysis/SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. Almost everybody in the business world is aware of SWOT. While aSWOT analysisis mainly used by the management, it can be effectively used formarketing and brandingas well. The analysis focuses on identifying the external and internal factors that might affect the future performance of any business. The four factors mentioned in a SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats) aim to evaluate the balance between the internal resources and capabilities of a company and external possibilities and threats.SWOT identifies the strategies used for creating a specific business model according to the companys available resources and capabilities, including the environment in which the company operates. It views positive and negative factors both inside and outside the firm, thataffect its success. The analysis helps the company forecast or predict changing trends that benefit the decision-making process of any organization.Heres a main overview of SWOT:StrengthsStrengths are the qualities that determine the success of any organization. They enable a firm to accomplish its mission. However, in the business world, strengths can either be tangible or intangible. Strengths include the traits and qualities your employees possess and their flair that offers your organization consistency. Strengths of an organization may include huge financial resources, committed employees, and no debt, etc.WeaknessesYou must be aware that weaknesses are the qualities that hinder an organizations productivity and prevent an organization from accomplishing its mission and reaching its full potential. However, weaknesses are controllable and the magnitude and impact of the damage can be reduced but to do so, you will first have to identify your companys weaknesses. SWOT is an effective means of not only identifying a companys weaknesses but providing an opportunity to reverse said weaknesses. Examples of common weaknesses include narrow production range, incompetent employees and lack of funds.OpportunitiesThere are countless opportunities that are present in the environment within which the organization operates. Companies can always benefit from suchopportunities. The opportunities may arise from the market, competition or technology. Existing opportunities might be the use of new technology, the failure of any one of your competitors, or taking advantage of the companys existing resources which remain untapped as of yet.ThreatsThreats are elements of vulnerability that may jeopardize the reliability and profitability of any business. Threats are inevitable and uncontrollable but they need to be addressed in order to find a viable solution. Some examples of threats include declining industry profits, increasing competition or economic crisis.Benefits of a SWOT AnalysisSome benefits of performing a SWOT analysis include:Cost-effectiveYou do not require extensive training nor any form of technical skill for conducting a SWOT analysis. In addition, you dont require an external consultant. All you need is a staff member who has prior knowledge of business.Wide Range of ApplicationsSWOT analysis can be used toconduct competitive analysis,strategic planningor any other study. This is because, through a SWOT analysis, a business can identify any environmental factor that plays a favorable or unfavorable role in any particular objective.Promotes DiscussionSWOT analysis promotes discussion. It is important that you have your employees on the same page. Every single employee plays an important role in driving an organization to success. Discussing the core strengths and weaknesses of a company helps identify threats and capitalize on opportunities.Provides Visual OverviewA SWOT analysis is usually presented as a square, each quadrant representing one factor. This visual arrangement provides a quick overview of the companys position and encourages dialogue. While each quadrant may not be of equal importance, the quick overview helps an organization determine its success and progress, maximizing their strengths and diminishing their weaknesses.Offers InsightSWOT can be used to gain insight about the market, giving youa better understanding of your competition. This gives you the opportunity to formulate a planto craft a coherent and competitive position in the market.Integration and SynthesisSWOT analysis gives the analyst the opportunity to integrate and synthesize diverse information, despite it being qualitative or quantitative in nature. SWOT analysis organizes information that is already known, as well as information that has just been acquired or discovered. SWOT analysis deals with a wide diversity of information sources. This makes it easier for a company to transform information diversity from a weakness into a possible strength.Fosters CollaborationSWOT analysis fosters collaboration and encourages open information exchange between a variety of functional areas in a firm that would otherwise not collaborate or interact much. It benefits a company when the analysts understand what their counterparts know, think, feel and do. This allows the analyst to solve problems, eliminate disagreements and foster a better working environment.Other benefits include: SWOT analysis provides an organization a clear view of its strengths, allowing it to build on them and meet business objectives Highlights weaknesses and provides analysts a chance to reverse them Showcases possible opportunities that lie ahead. This gives the firm an opportunity to draft strategic growth plans for the future accordingly Helps an organization recognize possible threats and take necessary measures to deal with them. Companies can introduce new policies and establish growth plans to eliminate any possible threats. SWOT analysis allows a company to create matching and converting strategies SWOT analysis sheds light on the companys existing resources which may have been ignored or have not been used to their full potential Provides motivation to upgrade business plans SWOT focuses on the skills, capabilities, attitudes, abilities and capacitiesMany firms considerSWOT analysis an effective toolfor analyzing marketing data and information. The simple and straightforward framework provides a sense of direction and works as a catalyst for the development of futuremarketing plans. If performed correctly, a SWOT analysis not only organizes information and data but also uncovers competitive advantages that a business can use to gain leverage over its competitors in the market.A SWOT example on UBER/swot-analysis-for-uber/Uber is a high-tech company that was founded in 2009. It brilliantly connects the transportation industry with technology via its ride-sharing app. In 2014, it was stated as the highest valued venture-supported company. Uber offered its service in over 200 cities in 53 countries by 2014.Uberis valued at over US $40 billion. This means, its value is more than the full U.S. taxi and limousine industry. It is expected that the startup will have yearly revenue of $10 billion by 2015.There are many reasons why the users love Uber. It allows a more convenient, easier and less costly way to reach a location. However, the firm evokes some contrasting emotions too. The local government, traditional taxi drivers, and a small group of Uber drivers are against the practices that the startup engages in.Because of these differing views, Uber should make some changes. Many are raising questions about the companys ability to rule the transport industry in 2015. ASWOT analysisseems like the best option, in this case. It will help you explore the opportunities and threats the company might face. It will also contribute to finding out what the strengths and weaknesses of Uber are.Strengths and weaknesses are internal factors. Uber has control over these elements. Opportunities and weaknesses are the external factors in SWOT. Uber does not have any control over these. However, it must take measures to exploit opportunities and avoid the threats. Below, I have added theSWOT analysis of Uber.Strengths: It is a well-recognized brand It has a high standard of service, verified drivers and cars.Uber Blackusers enjoy very high standard of service. Has an unlimited fleet of vehicles. Regular Taxi service regulations are not applicable for Uber. Uber has no full-time drivers. As it does not hire drivers, there are no responsibilities toward employees. Operational cost is quite low. As it relies on customer-to-driver interaction, a dispatcher is not needed. Very little competition. A major competitor is Lyft. As cashless payment system is used, Uber can track and choose highly rated drivers. It has many other features like getting a car easily and having record of the spending. Dual rating system boosts trust and safety. The system is convenient for the drivers. They can work flexible hours and even choose to be a part-time employee. Drivers can also reject unwanted clients. The prices are lower compared to traditional taxi operators. High valuation of Uber. Many people are ready to invest on it.Weaknesses: The idea can be easily imitated. Nothing will prevent competition from presenting the same product. The relationship between Uber and the drivers is ethically questionable. It lacks the real connection. So, it is expected that loyalty between Uber and its drivers is quite low. Also, company and its customers have no bonding. Incentive to remain with Uber is low. Costs of operating vehicles are very high. But, the drivers do not earn so much. Very Unpredictable business model. There are privacy concerns. Uber records where customer gets the taxi from. It also notes where he goes with it.Opportunities: Customers are often dissatisfied with traditional cab companies because of high prices and long waiting time. It can exploit new and big markets in countries likeIndiawhere taxi services are inconvenient and expensive. Can tap growing markets in suburban areas where taxi services are not available. Rise in number of Uber drivers will reduce the Estimated Time of Arrival. This will make Uber more liked. The startup will get more revenue and drivers will be profited as well. Uber can increase the valuation. This might appeal more investors. As a result, Uber will have more money to operate. Cheaper electric cars can be used. It will reduce the cost and increase the drivers profit margin. Additional services like transporting older patients to hospital, transporting children to school and transporting pets to the vet can be offered.Threats: Drivers arent happy with the low-profit margins. This might lead to bad publicity. This can in turn discourage the new drivers from joining Uber. Some new legal regulations in countries likeGermanywill ban Uber from operating. Problems with local authorities can lead to fines. It will also earn a bad PR. Increasing competition will ultimately decrease prices. This will discourage drivers from joining the startup in new markets. This will result in loss of customers. Ubers revenues will decline. As