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Definition

SWOT analysis

SWOT is an acronym for the internal Strengths and Weaknesses of a firm and the environment opportunities and Threats facing that firm. SWOT analysis is a historically popular technique through which managers create a quick overview of a company’s situation. It is based on the assumption that an effective strategy derives from a sound fit between a firms internal resources and its external situation. A good fit maximizes a firms strengths and opportunities and minimizes its weaknesses and threats. Accurately applied, this simple assumption has sound, insightful implications for the design of a successful strategy.


SWOT analysis is the SWOT is an acronym for strengths, weaknesses, opportunities, and threats. By systematically evaluating all four of these factors, a firm can then develop the best strategies for gaining a competitive advantage.

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