SWOT analysis is a procedure that a team management uses to identify strengths and weakness in the organization

SWOT analysis is a procedure that a team management uses to identify strengths and weakness in the organization. SWOT stands for: strengths, weaknesses, opportunities and threats. SWOT analysis is used for the strategic planning, to that the organization is on target to meet their aims and objectives. When the organization practices SWOT analysis they have to be truthful about their bad points and good points. Strengths and weakness are internal, whereas opportunities and threats are external.
Strengths?
Strength is basically, that makes any specific organization different from others. Like powerful brand, unique technology, highly qualified work source, loyal consumer base and efficient production leading to low cost. For example, if I take Apple products and Lenovo products into consideration, People will tend to buy more apple products over Lenovo one’s because apple is a powerful brand and has loyal consumer base.
Weaknesses
?Weakness mainly indicates insufficiency of a source, which basically stops the business from functioning at the maximum level. There are some areas that the businesses need to develop to remain competitive. For example, inefficient production leading to high cost. Moreover, less qualified work source.
Opportunities?
Opportunity refers to external factor. This is the factor which organization can use to practice to give competitive advantage. Competitive advantage is linked to a key source, which is the cost advantage. Where a business is able to produce its products at lower cost than the competition. Competitor can go bankrupt if bills not paid or heavy amount not given.
Threats?
Threat is related to those factors, which have potential to destroy an organization. For example, there are many cheap products appearing in the world, which allows people to buy products that are cheap and look exactly like a branded product. This eventually brings down the profit of a branded company.
Conclusion
SWOT analysis is a valuable method for judging the organizations strengths and weaknesses while recognizing the opportunities and problems that an organization has.
PEST analysis looks at the external environment of an organization. PEST stands for: political, economic, social and technological factors. This analysis is really important for an organization because here an organization looks at factors that they have no control over but still trying to achieve their goals.
Political
Political factor basically tell the organization that up to what extent government involvement can affect the business economy. The factor includes labour law, tax, change management and restrictions. Political controls are not in the control of organization they are unpredictable. For example, if the government increases the minimum wage. The costs for employees go up. Then the organization owner will either increase prices or higher fewer employees so can pay more to the employees. Though, if prices are raised there will be few customers buying the product. So most of the business will find a way to operate with fewer workers or reduce the work hours for the employees.
Economic
Economic factor includes the exchange rates, economic growth. For example, exchange rates affect the cost of importing raw material and machinery and also it can affect the competiveness of businesses. If the exchange rates are gone down in the country this can affect the organization. If an organization has imported or exported goods. Inflation also affects the organization. For example, if an individual’s monthly income doubles this will allow the individual to afford more stuff. But what if everyone’s income also doubles. The individual will no longer be able to buy more stuff. Because every one else also earns double the amount .so people will be earning more money but chasing the same amount of goods. So, if there is an overall increase in the price of goods then an individual should earn more money than the previous year to avoid becoming poor.
Social
Social factor includes the cultural factors and some other factors such as: standard of living, level of education, gender differences, and religious factors. These factors influence people to be aware of the product.
Technological?
Factors will include productivity of machinery, Research, development facilities, maturity of technology, and higher range of capacity. These factors have influence on the quality, quantity and the cost. For example if an advanced machinery is used in an organization to make product it will make more product than the organization which has the old machinery.so the quantity of the products will be more and the quality of the products will be outstanding.
Conclusion?
According to the PEST analysis the business organization can identify which factors are they being affected from .so they can be full aware and be up-to-date. PEST analysis is one of the comprehensive ways to study the effect of various factors and then utilize them for opportunities and by defending against the threats.
Current factors that might affect business now and in the future.
Current factor that might affect the business is Brexit. Brexit is basically, whether Britain should exit the European union. If the Britain exits it will be tougher for people to move across borders and also it will be tough for trade like export and Import. For example: if the price of a specific good increases for about 30% this will be bad for both the good makers and the British consumers. On the other hand, uncertainty will affect the investments. Moreover, trump’s protectionism can also affect the business. This is about relationship between Donald trump and the American business in his opinion; if trade partners behave unfairly he is willing to put up tariffs. The problem is he wants to impose tariffs on companies that ship any jobs offshore. This would actually hurt American consumers and will end up leaving America poorer.

x

Hi!
I'm Dora

Would you like to get a custom essay? How about receiving a customized one?

Check it out
x

Hi!
I'm Barry!

Would you like to get a custom essay? How about receiving a customized one?

Check it out