SWOT analysis (or SWOT Matrix) is a business strategic planning technique that a person or organization use to identify the Strengths, Weaknesses, Opportunities and Threats in a concept or project before executing it.

There are, however, advantages and disadvantages associated with this type of analysis so before using SWOT to judge a business idea or proposal, here are the pros and cons of this process you should consider and what they mean to your business.


Zero cost: One of the biggest advantages of SWOT analysis is that it has no associated costs. It is an analysis that anyone in the business can reasonably complete and, therefore, do not require any engagements of specialists or consultants. It is an effective method for analyzing projects and proposals within a company in any function or industry.

Important results: The premise behind the SWOT analysis is to identify the strengths, weaknesses, opportunities and threats in the analyzed concept. The ideal outcome, which can be very important for a company, is to maximize strengths and minimize weaknesses so that the company can take advantage of the external opportunities listed above to overcome identified threats. In this sense, there is great value in the results that can produce a SWOT analysis for a business.

New ideas: Another benefit of SWOT analysis is that it can help create new ideas for the business. By examining the issues that appear in the columns and rows of a SWOT analysis, as a society, it not only increases awareness of potential advantages (or disadvantages) and threats, but can also help us to respond more effectively in the future, the formation of plans to counteract as they occur.


Submission not critical: Since the typical SWOT analysis is simple on premise, it is not usually subjected to criticism. If the company focuses only on the preparation of records, it may not be sufficiently focused on the means to achieve its objectives. There are other drawbacks to approaching the list as well as items that may not be properly prioritized by the company. A long list of shortcomings, for example, may seem to have been endorsed by an even longer list of strengths, weaknesses, but they are important and must be addressed.

Additional research needed: In order for a SWOT analysis to be truly successful, it must extend beyond a simple list of strengths, weaknesses, opportunities and threats. For example, a company should consider what degrees of strengths and weaknesses it has compared to competitors to determine how strong those strengths really are. A thorough SWOT analysis should look at an opportunity or size of threat to see how it is related to the strengths and weaknesses of the company.

So bearing in mind, while a SWOT analysis can be simple and straightforward, more research and analysis is generally needed to get a complete picture.

Subjective Analysis

For an analysis to impact a company’s performance, business decisions must be based on reliable, relevant and comparable data. However, SWOT data collection and analysis can be a subjective process that reflects the bias of the individuals who conduct the analysis. In addition, the data input to the SWOT analysis can also become outdated fairly quickly.

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