Is SWOT analysis an effective strategic planning method?
Answers
SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis is an effective method, but one that should probably be used in conjunction with other methods. SWOT analysis is ideal for simplifying large quantities of complicated situational factors into more manageable categories. But, SWOT analysis can also oversimplify these factors. Also, the classification in this analysis can be somewhat arbitrary. In fact, some factors can be categorized as both a Strength and Weakness.
Remember, SWOT is designed to assess the enterprise capabilities among its competitors. This is very top-line benchmarking to arrive at, or validate a Positioning Strategy that is defensible and profitable. The last comment made by M Dunn is noteworthy. Objective analysis is critical to the process. Know what you know; Know what you don't know; and Know that there is information you don't know that you don't know.