What is Swot Analysis?

Swot Analysis

Swot Analysis refers to the systematic order companies and institutions follow to manage the process efficiently before a project or commercial venture. In order to carry out this process correctly and efficiently, it is essential to evaluate the techniques and methods they use by determining their strengths and weaknesses and being careful in understanding and solving the opportunities and threats arising from internal and external environments.

Evaluating the strengths and weaknesses or opportunities and threats for their projects by following the techniques and methods is very effective in revealing the competitive aspects of these companies.

Who Invented Swot Analysis?

When we look at the history of Swot Analysis, it can be said that it was first revealed in the 1960s by Albert Humphrey, who specialized in business management.
Swot Analysis techniques, which Albert Humphrey first created, were developed by different business experts in the following years and took their current form and continue to be developed.

When Should You Perform a Swot Analysis?

After determining the current situations related to a project, the strengths, weaknesses, opportunities, and threats are determined, and with this data, the Swot Analysis is formed. After this Swot Analysis is evaluated, a strategic plan is made, and the work begins.
In short, it’s very significant to form this analysis before starting the project in order to make it effective.

How to Do a Swot Analysis?

Researching and Exchanging of Views:

The first point to focus on before doing a Swot Analysis for your project; you should use the data you have objectively by getting the ideas of everyone involved in the project. These evaluations you make before starting the Swot Analysis help give much more accurate results.

Identifying the Strengths of the Project:

The first stage of Swot Analysis is to analyze and evaluate your work’s strengths and reach clear results. Examples of the strengths of your work or project are your employees’ contributions to the project, providing the necessary financial expenses, your competitive environment, and the advantages of your location.

Identifying the Weaknesses of the Project:

In order to determine the weaknesses of the project you have prepared, you should evaluate the opposite situations. Examples of weaknesses are financial inadequacies, problems arising from the customer portfolio, or inadequate marketing strategies. The most important purpose here is to produce new solutions by knowing your weaknesses.

Evaluation of Opportunities for Your Project:

You should always seize opportunities for your project or business. While evaluating the internal advantages and disadvantages of the business, the changes arising from the external environment should always be taken into account. It can be given many examples such as technological developments, various market areas, changing customer portfolios, and training programs.

Evaluation of Threats for Your Project:

Everything that may have a negative impact on the project you have created should be carefully analyzed, and a solution should be sought to eliminate. At the beginning of the threats that may arise, examples such as financial problems for the project, lack of workforce, and excess in the competitive environment can be given.

Swot Analysis Example

For a clear understanding of Swot Analysis:

Consider an architecture company; they plan to construct several houses successively, and their plan consists of many trees; their main aim is to feel them inside a forest. But they have only two years to construct all of them. So;

Firstly, they should analyze the strengths. They can ask themselves their budgets for this job or qualified workers that can construct these houses.

Secondly, they should analyze the weaknesses. They should analyze their time for this construction. They should ask themselves, is this time enough for both the construction of these houses and the plantation?

Thirdly, they should seize the opportunities; in order to complete all of the work, they should use the technological advantages, and then they should announce their project with the right marketing strategy.

Lastly, they should analyze the threats raised for their project. They should ask themselves, is there enough workforce or budget? Or are there any similar projects close to the location where the project will be held before, and does this affect the project negatively?

Why is Swot Analysis Important?

The first reason Swot Analysis is vital to companies is its versatility; regardless of the subject, all projects or new applications can be evaluated with this analysis, and beneficial results for the company can be achieved.

Another reason can be stated as; Swot Analysis is not only applied to projects or plans, but you can also benefit from this analysis of the company’s current situation. For example, the efficiency of the company’s current employees, the budgetary situations, or the situation concerning competitor companies can be evaluated with Swot Analysis, and important arrangements can be made for the company.

What are the Biggest Swot Analysis Mistakes?

One of the most severe mistakes that can be made while performing Swot Analysis is the failure of the company to approach it with an objective point of view while identifying its weaknesses.

Another mistake that can be made is the inability to reach a definite conclusion when evaluating the strengths and weaknesses of your own company by not having a good grasp of the current situation of rival companies.
Both these situations prevent Swot Analysis from being done correctly, which makes it impossible to do accurate planning for your current projects.

What is a Swot Analysis Used For?

Swot Analysis is one of the ways for companies to create and maintain their current projects and plans correctly so they can go towards strategic growth. This analysis method, which allows companies to evaluate their plus and minus aspects, and also helps to examine internal and external factors in detail, is very important for the growth and development of the companies.