What are the differences between the internal and external factors associated with the SWOT analysis?
You asked for differences between the internal and external factors associated with SWOT analysis.
Internal factors (strengths and weaknesses) are much more under the control of the organization. The organization can move people around, provide training, change how it uses other resources, and do other things internally to strengthen its ability to achieve objectives.
External factors (opportunities and threats) are far less under the organization's control and can have an impact on the internal factors. Keep in mind that a threat to one organization is often an opportunity for another organization.
For example, the current economy is a threat to many organizations. How do you motivate employees when you are laying them off because consumers cannot afford to buy your products? It is an opportunity for organizations that can position themselves to provide services for people who are laid off or can outsource services to organizations that have undergone a layoff.
the term SWOT is an acronym formed from first letters of four words - strengths, weaknesses, opportunities and threats. This term is used for an analytical technique involving identification and analysis of strengths, weaknesses opportunities and threats for a firm to help the firm formulate its strategy.
The four factors of the swot analysis consist of two factors that are internal to the firm engages in the strategic planning process. These are strengths and weaknesses of the firm. The other two factors, that is, strengths and weaknesses, are environmental factors. They represent some characteristics of the environment faced by the company rather than the characteristics of the company it self.
SWOT analysis (Strength-Weakness-Opportunity-Threat) is actually a technique that can identify strengths and weaknesses and there could be examined opportunities and threats of a project, or of an action, or of an individual.
Generally, there are two ways that SWOT analysis can be used: for business or for personal reasons. For personal reason, SWOT analysis can be used to monitor a person's career, noting the skills and the problems the person has. In the professional context, SWOT analysis can be used to measure the profitability of a business or project.
If SWOT analysis is made for a company,the first two acronyms (S.W.) concern the company and reflects it's position, and the last two (O.T.) concern the environment and reflect it's impact on activity of the company analyzed.
Strengths of a company are characteristics or distinguishing skills that it possesses at a higher level, compared with other companies, especially competitors, which assures it a certain advantage.
The weaknesses of the company are its characteristics that determine a performance level below of those of competitors.
Opportunities are positive external environmental factors for the company, ie chances offered by environment, to the firm, to establish a new strategy or to reconsider the existing strategy, in order to exploit arising profitable opportunities.
Threats are negative external environmental factors for the firm, ie situations or events which may affect adversely, in significant measure, the firm capacity to fully achieve the set targets, the result being the drop of its financial and economical performances.