SWOT (TOWS) ANALYSIS (Strength, Weakness, Opportunity, Threat)

SWOT (TOWS) ANALYSIS
(Strength, Weakness, Opportunity, Threat)




INTERNAL

EXTERNAL



EXTERNAL INTERNAL OPPORTUNITY THREAT
STRENGTH “S-------------------O”Maxi----------------Maxi(Growth) “S-------------------T”Maxi----------------Mini(Stability)
WEAKNESS “W-------------------O”Mini----------------Maxi(Stability) “W-------------------T”Mini----------------Mini(Retrenchment)

STRATEGIES:

1. Growth (Direct Growth)
2. Stability (Think & Move)
3. Retrenchment (Joint Venture or Merge or Liquidate)


Ø The above figure shows the following strategies:

1. SO: The most desirable situation occurs when a company can use its strength to take advantages of opportunities. Indeed, it is the aim of enterprise to move from other positions in the matrix to this one.

2. ST: This is based on the organizational strength to deal with threats in the environment. The aim is to maximize the Strength and minimize the Threat. Thus, a company may use its technical, financial, managerial skills to avoid threats.

3. WO: In this, attempt to minimize the weakness and maximize the opportunities. Thus, a firm with certain weakness in some areas may either develop those areas within the enterprise or acquire the need competencies from outside and make it possible to take advantages of opportunities in the environment.

4. WT: This aims to minimize both weakness and threats. It may require the company to form a Joint Venture, Retrench or even Liquidate.