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



S-O strategies W-O strategies


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.



Anonymous said...

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