What is SWOT analysis? Explanation, Features and Use

What is SWOT analysis?

SWOT analysis is an analysis method used in various aspects such as the business strategy of a company or business and marketing decision-making. It’s a very simple framework, and if you don’t use it well, you’ll only get ambiguous analysis results.

Here, SWOT analysis Explanation is explained in an easy-to-understand manner, from features such as advantages and disadvantages to points for effective use and usage.

SWOT analysis

  • Weakness
  • Strength
  • Opportunity
  • Threat

Four elements of the SWOT analysis method

It is an analysis method consisting of four elements.

  1. “SWOT” is an acronym for each element.
  2. Let’s take a look at each element.
  3. Here are some examples to help you better understand.
  4. Here, each element of Starbucks, a representative of foreign-affiliated cafes, is cited.

What is Strength?

This is one of the strengths of the company when it comes to the strategy and marketing of companies and businesses.

  • Strong brand power
  • Staff morale is high

 What is Weakness?

Strength is the opposite of the company’s weaknesses.

  • The product unit price is high
  • The low utilization rate of elderly people

 What is Opportunity?

This is the part that is a factor that gives your company an opportunity.

  • Coziness
  • Genuine orientation for coffee

 What is a Threat?

This is a factor that negates the strengths of the company.

  • Increase in competitors
  • Increased health consciousness

Purpose of SWOT analysis

SWOT analysis can be used to analyze the current situation of your company such as business strategy and marketing by combining four elements.

It is an effective framework for creating and rediscovering your company’s business opportunities by looking at the environment surrounding your company from both internal and external perspectives.

It may also be used to make an ex-post evaluation that improves a problem.

For example, it is a positive factor for the company

  • “Strength”
  • “Opportunity”

By multiplying these, you can consider measures to take advantage of your strengths and proactively seize opportunities.

Considering that the measures cannot be implemented well after implementing the measures, the negative factors

  • “Weakness”
  • “Threat”

It is also possible to consider defense measures by multiplying.

By combining these four elements in this way, it becomes easier to consider and share in what direction your company should move.

Why SWOT analysis is so important

The reason why many entrepreneurs and business owners attach great importance to SWOT analysis is that the competition for survival is fierce in modern society where it is difficult to differentiate.

How do you approach the environment and factors that you cannot control? Isn’t that what the management wants to know?

When a company formulates a strategy, it finds issues from the information it collects and thinks about how to realize them and how they implement them.

SWOT analysis “How to make it happen

It is useful in the part of.

It can be said that the reason why SWOT analysis is regarded as important in various aspects is that problems and issues can be found at a glance and lead to speedy decision-making.

Advantages and disadvantages of SWOT analysis

Benefits or advantages of SWOT Analysis

The advantage of SWOT analysis is that you can derive ideas with a simple method from the current situation to the future.

Furthermore, SWOT analysis can objectively grasp the situation by analyzing both the internal environment and the external environment.

Since you can grasp the pluses and minuses of the analysis target at once, it is also useful for unifying your intentions.

Disadvantages of SWOT analysis

In SWOT analysis, things are considered in a polarized manner.

For example, in the internal environment, it divides the strengths and weaknesses of the company.

In SWOT analysis, you have to classify it into either element.

In this case, you will need to define your strengths and weaknesses.

Three points to make effective use of SWOT analysis

1. Determine the purpose of SWOT analysis

If you want to make effective use of the results of SWOT analysis,

“What are you analyzing for?”

It is important to clearly define the purpose. In addition, it is essential to share it with all consideration members. By discussing and analyzing after that, you can obtain results that can lead to the next action.

2. Organize the prerequisites required for SWOT analysis

It is important to always organize the prerequisites required for SWOT analysis. Different assumptions have different strengths and weaknesses, as well as opportunities and threats.

By clarifying the preconditions according to the purpose, such as what the analysis target is, what goals it has, and the attributes of competitors and customers, everyone’s perception can be unified.

3. Selection of consideration members to prevent bias in the analysis

When performing a SWOT analysis with multiple people, the selection of participating members is also an important point. If owners with similar perspectives come together, the analysis will be biased.

To perform analysis from a broad perspective, select people from different positions according to the purpose and target of the analysis.

SWOT analysis method

1. Analysis of the external environment

In SWOT analysis, first of all, we will focus on the opportunities and threats of our company and proceed with the investigation and analysis.

Group answers to questions related to your company’s opportunities and questions related to your company’s threats.

By doing so, you can read the market size and business growth potential.

At this time, the SWOT analysis framework alone may cause omissions, omissions, and duplications.

Actively use other frameworks as needed for a comprehensive analysis.

  • PEST analysis
  • Five force analysis
  • PLC (Product Lifecycle)
  • Innovator theory
  • Value chain
  • VRIO
  • 7 S

 2. Analysis of internal environment

Next, we will proceed with the investigation and analysis of the internal environment. In particular, the internal environment is a part where subjectivity is easier to enter than the external environment. At this time, refrain from judging trivial opinions that you think are not enough to be taken up. Also, for opinions that cannot be divided into strengths and weaknesses, writing out the scene together makes it easier to understand the pattern. After the analysis is completed, the exported contents are summarized in each SWOT frame. Checking for omissions or omissions here will increase the usefulness of the next cross-analysis.

3. Cross analysis

Based on the results of surveys and analyses under each environment, we will analyze to formulate strategies and incorporate measures into plans. It is called “cross-analysis” because it analyzes by multiplying the four elements of SWOT.

Cross-analysis is an effective analysis method for deriving a realistic response to achieve the purpose of the SWOT analysis listed at the beginning. Since it analyzes from multiple sides, it widely us from strategy and marketing to personal activities. Here, we summarize what kind of situations each cross-analysis is effective for and how to think about it. Even if it is the same event, some things can be converted into strengths and weaknesses by changing the viewpoint.

By interpreting each event from multiple perspectives and identifying the potential of your company, you can formulate a plan that can achieve your goals. For each scene, we have prepared questions for the answers to be derived. Try to arrange these questions according to your company’s challenges.

Questions can arrange your company’s challenges

Strengths (S) x Opportunities (O) | Effective combinations when considering your company’s growth strategy

  • How can you take advantage of your company’s strengths and opportunities?
  • What kind of measures will be taken for the growth opportunities of the company and business?

Weakness (W) x Opportunity (O) | Effective combination to capture the weaknesses of your company and seize the opportunity

  • How can you overcome your weaknesses and take advantage of opportunities?
  • What are some ways to reinforce your weaknesses and take advantage of opportunities?

Strengths (S) x Threats (T) | Effective combination of countermeasure strategy against your company’s threat and avoidance of opportunity loss

  • How can we take advantage of our strengths to counter threats?
  • What are the workarounds for threats that leverage the strengths of the company?
  • What kind of opportunities do you have when a threat that affects your company strikes?

Weakness (W) x Threat (T) | Effective combination when considering workarounds and defenses against threats

  • How can I understand my weaknesses and avoid threats?
  • How can you minimize the impact of threats from your weaknesses?

4. Incorporate into the plan

After completing the cross-analysis, we will finally incorporate it into the action plan.

Here, first of all, we will decide what kind of action to take concretely based on whether or not we can contribute to the achievement of the goal.

The actions you should pick up are the ones that are most effective in achieving your goals and the ones that are easiest to perform.

We will prioritize them and execute them.

SWOT analysis and cross-analysis are also effective for evaluation after execution.

If there are any problems or issues, review the plan again and improve the accuracy of the action to achieve the goal.


SWOT analysis is an effective analysis method for understanding the external environment and internal situation of a company.

Cross-analyzing each element of SWOT allows companies to better utilize their resources and derive strategies for opportunities and threats.

The environment and circumstances surrounding a company are constantly changing. Therefore, it is advisable to perform a SWOT analysis regularly.

In addition, SWOT analysis is a framework that can be used not only for businesses but also for individuals. It can be used in various situations such as allocating human resources in the right places.