Convenience

Mission
An organization’s fundamental purpose
Good Strategies
SWOT Analysis
To formulate strategies that support the mission
Those that support the mission and
•
exploit opportunities and strengths
•
neutralize threats
•
avoid weaknesses
Internal Analysis
Strengths
(distinctive
competencies)
Weaknesses
Threats
External Analysis
Opportunities
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F I G U R E 3 . 2
SWOT Analysis
SWOT analysis is one of the most important steps in formulating strategy. Using the
organization’s mission as a context, managers assess internal strengths (distinctive
competencies) and weaknesses as well as external opportunities and threats. The
goal is then to develop good strategies that exploit opportunities and strengths,
neutralize threats, and avoid weaknesses.
SWOT
An acronym that
stands for strengths,
weaknesses,
opportunities, and
threats
organizational
strength
A skill or capability
that enables an
organization to
create and
implement its
strategies
Chapter 3:
Planning and Strategic Management
7 3
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purpose of SWOT analysis is to discover an organization’s distinctive competencies so
that the organization can choose and implement strategies that exploit its unique organi-
zational strengths.