What does a SWOT analysis evaluate?

A SWOT analysis evaluates an organization’s internal strengths and weaknesses, as well as external opportunities and threats. This framework is widely used in strategic planning to help organizations gain insights into their current situation and inform decision-making processes.

Strengths refer to the internal attributes or resources that give the organization a competitive advantage. Weaknesses are the internal factors that may hinder the organization’s performance. Opportunities are external factors that the organization can potentially exploit to its advantage, while threats are external challenges that could pose risks to the organization's success.

Understanding these four elements allows organizations to align their strategies with their capabilities and the external environment, making this analysis essential for effective risk management and strategic planning.