What does SWOT analysis stand for in strategic planning?

SWOT analysis is a strategic planning tool that helps organizations identify and understand internal and external factors that could impact their success. It encompasses an evaluation of four key components: Strengths, Weaknesses, Opportunities, and Threats.

Strengths and Weaknesses pertain to internal factors, where strengths are the resources and capabilities that provide an advantage, and weaknesses are areas where the organization may be at a disadvantage. Opportunities and Threats, on the other hand, focus on external factors; opportunities are favorable situations in the environment that the organization can exploit for growth or improvement, while threats are challenges or obstacles that could hinder the organization’s performance.

This framework allows businesses to create strategies that leverage their strengths, address their weaknesses, capitalize on opportunities, and mitigate threats, providing a comprehensive view that is essential for strategic planning.