SWOT ANALYSIS

              THE SWOT ANALYSIS





A SWOT analysis is a very effective way of recognizing what the strengths and weaknesses of an organisation are and also what opportunities might be available, along with the threats it might have to face. Therefore a Swot analysis helps the organisation to carve a sustainable niche in the market. Strengths and weaknesses suggest the internal environment of the organisation. For example, factors relating to products, pricing, costs, profitability, performance, quality, reputation, infrastructure e.t.c. All these factors usually tend to be in the present. While on the other hand Opportunities and Threats suggest the external environment within which the business operates. For example, factors relating to markets, sectors, audience, fashion, trends, competition e.t.c. All these factors however tend to be in the future.

The main advantage of conducting a SWOT analysis is that it has little or no cost, any one who understands the business can perform the analysis. A SWOT analysis concentrates on the most important factors affecting the business, therefore using SWOT a manager can understand the business better, address the weaknesses of the business, avoid the apposing threat to the business, work according to the opportunities going to be available, therefore develop business goals and strategies in order to achieve them.

When conducting a SWOT analysis the following limitations should be kept in mind. A SWOT analysis only covers issues that can definitely be considered as a strength, weakness, an opportunity or a threat. As a result it is difficult to assess uncertain factors, that are factors could be a strength or a weakness or maybe even both. As a result making the SWOT analysis not of much use in making complex decisions. As the analysis may be limited because it does not priorotise issues , or ot does not provide solutions for alternative decisions e.t.c.
Below can be seen a SWOT analysis for Apple;

Apple SWOT analysis 2013
Strengths	Weaknesses
Customer loyalty combined with expanding closed ecosystem Apple is a leading innovator in mobile device technology Strong financial performance ($10,000,000,000 cash, gross profit margin 43.9% and no debt) Brand reputation Retail stores Strong marketing and advertising teams	High price Incompatibility with different OS Decreasing market share Patent infringements Further changes in management Defects of new products Long-term gross margin decline
Opportunities	Threats
High demand of iPad mini and iPhone 5 iTV launch Emergence of the new provider of application processors Growth of tablet and smartphone markets Obtaining patents through acquisitions Damages from patent infringements Strong growth of mobile advertising market Increasing demand for cloud based services	Rapid technological change 2013 tax increases Rising pay levels for Foxconn workers Breached IP rights Price pressure from Samsung over key components Strong dollar Android OS growth Competitors moves in online music market

 Therefore through this example it can be seen and clearly understand what Apple has to do to avoid the threats that might be coming the companies way and get a grasp of the opportunities. For instance a rapid change in technology would man that the company would have to design new products accordingly, before its competitors do so. Like wise an opportunity such as a strong growth expected from the mobile advertisement market suggests that Apple should invest more towards its advertisement, which is expected to therefore increase sales automatically.  Such steps essential to be taken by a firm in order to do well or survive in the future can easily be projected through the SWOT analysis.