Sunday, November 22, 2009

The SWOT Matrix

A firm should not necessarily pursue the more lucrative opportunities. Rather, it may have a better chance at developing a competitive advantage by identifying a fit between the firm's strengths and upcoming opportunities. In some cases, the firm can overcome a weakness in order to prepare itself to pursue a compelling opportunity.

To develop strategies that take into account the SWOT profile, a matrix of these factors can be constructed. The SWOT matrix (also known as a TOWS Matrix) is shown below:

SWOT / TOWS Matrix


Strengths
Weaknesses

Opportunities

S-O strategies W-O strategies

Threats

S-T strategies W-T strategies


  • S-O strategies pursue opportunities that are a good fit to the company's strengths.

  • W-O strategies overcome weaknesses to pursue opportunities.

  • S-T strategies identify ways that the firm can use its strengths to reduce its vulnerability to external threats.

  • W-T strategies establish a defensive plan to prevent the firm's weaknesses from making it highly susceptible to external threats.

source: http://www.quickmba.com/strategy/swot/

1 comments:

salman ali said...

strengths and weaknesses are internal factors while opportunities and threats are external factors which affect Strategy makings.