Background: SWOT Analysis

SWOT analysis helps identify an organization’s Strengths, Weaknesses, Opportunities and Threats. It encourages organizations to step back from day-to-day operations in order to look at the big picture. SWOT analysis was originally developed at the Stanford Research Institute in the 1960’s. The SWOT process was devised to help solve a problem: many of the Fortune 500 companies had found that their corporate planning efforts failed. In general, efforts to manage change and set realistic objectives endorsed by those responsible for achieving them had been unsuccessful. SWOT analysis was designed to engage all staff who affect a company’s success in systems for positive change.

The first step in SWOT analysis involves formulating a goal to help focus thinking and problem-solving. Then the facilitator introduces the SWOT matrix, which is divided into four quadrants, labeled “Strengths,” “Weaknesses,” “Opportunities,” and “Threats.” This tool allows a group to conceptualize and focus on areas of strength and weakness and to identify where the greatest opportunities lie within a realistic context. SWOT analysis encourages proactive thinking, rather than reacting to events in habitual ways.

Strengths and weaknesses can be defined as internal to the setting; opportunities and threats are external. Filling in the matrix provides a scan of the internal and external environment.