The Benefits of SWOT Analysis
Alison Lipson

Alison Lipson
Engagement Manager
Proactive Worldwide, Inc.

Published: January 20, 2023

Don’t Overlook the Benefits of SWOT Analysis

While a SWOT analysis is not a novel concept, many companies do not perform this type of analysis as often as needed. A traditional SWOT (sometimes also known as TOWS) helps increase awareness and planning to help fine tune any company’s business strategies and create situational awareness. This analytical tool is often used in the early stages of decision-making to help evaluate the strategic positioning. SWOTs can be used for the overall business, a division of the organization or a specific project.

What Exactly is a SWOT?

A SWOT is an analytical tool that gets its name from the categories it assesses: strengths, weakness, opportunities, threats. The first step in examining operations is to identify strengths. The benefits of identifying strengths helps companies highlight what is working well and what can be used as a point of differentiation against competition. On the flip side, weaknesses also need to be identified to understand what is not working, where the company is lagging or perhaps where it experiences shortfalls vs. competitors. Once these internal factors are identified, external factors can be examined.

Threats are external and out of your control. This is critically important as often there are many known threats (competitors’ positioning, economic factors, etc.) which are fairly easy to predict, however other threats can appear at a moment’s notice, as evidenced by dramatic changes in business due to the COVID-19 pandemic. Though external threats can be hard to predict, with continued analysis, companies can work to create strategies to mitigate some of those threats. Identifying opportunities is also incredibly important, allowing companies to leverage its strengths to gain an edge over competition or areas where competitors do not appear to be active in.

The Exercise

When initiating a SWOT analysis, there are several questions you can ask to help identify each area of analysis. This is typically set up with each area as a quadrant, allowing space for responses in each area. Sample questions are shown below.


  • What do you do well?
  • What resources do you have access to?
  • What do other people view as your strengths?


  • What could you improve?
  • What do you not do well (currently)?


  • What are the opportunities facing you?
  • What are the interesting trends you are aware of? (Such as changes in technology and markets, changes in government policies, social dynamics, population or lifestyle changes)


  • What obstacles do you face?
  • What is your competition doing?
  • Is changing technology threatening your position?
  • Could any of your weaknesses seriously threaten your business?

Putting a SWOT into Action

This type of analysis can provide a solid framework for reviewing strategy, competitive positioning and for setting the strategic direction for a company or business plan. The SWOT provides an assessment of a business or a plan, whether that is your own or a competitor’s. However, once armed with that information, it is important to ask yourself, “what do I do next?”

SWOT essentially tells you what is good and bad about a business or a particular situation. If it’s a business, and the aim is to improve it, then work on translating…

  • strengths (maintain, build and leverage),
  • opportunities (prioritize and optimize),
  • weaknesses (remedy or exit),
  • threats (counter)

…into actions that can be agreed, planned, assigned, and delivered by a team or number of teams.

It can be difficult to translate the SWOT challenges into concrete actions that can be incorporated into a plan. It becomes manageable when the actions are divided into six categories (shown below) that define the context for how organizations operate. Once the SWOT framework has been completed and issues have been prioritized, actions must be prepared to solve the issues.

You can use the six business planning categories as a practical strategy to organize the information, define short- and long-term priorities, and assist in achieving the overarching goal of growth.

  1. Product or Service (what are we selling?)
  2. Process (how are we selling it?)
  3. Customer (to whom are we selling it?)
  4. Distribution (how does it reach them?)
  5. Finance (what are the prices, costs and investments?)
  6. Administration (and how do we manage all this?)

Strategic SWOT

Alternatively, a Strategic SWOT can be used to incorporate an action minded mentality upon initiating a traditional SWOT. Think of a Strategic SWOT as taking a traditional SWOT one step further. A Strategic SWOT is more action oriented in nature compared to a Traditional SWOT and builds the action plan into the analysis. Once you have identified the internal and external factors affecting your business, the Strategic SWOT helps answer questions such as how can you leverage strengths to seize an opportunity or blunt a threat? A Strategic SWOT emphasizes:

  1. The actions that can be taken at the intersections of strengths/opportunities and weaknesses/opportunities
  2. The mitigation plans needed at the intersections of weaknesses/threats and strengths/threat

The focus is on key actions or mitigation plans that are clearly supported by each SWOT. If you cannot clearly explain why you outperform your competitors on items in the strengths/opportunities category, you may be exaggerating either your strengths or your opportunities.

Benefits to Your Business

A traditional or Strategic SWOT can have many benefits to your business. A traditional SWOT analysis is a useful tool for understanding a firm’s competitive position and/or the competitive position of competitors which can help ground you or inform strategy. This can help provide an overall sense of where you currently are and where you need to be to gain a competitive advantage. For example, a PWW client recently used a SWOT analysis as part of a competitive assessment to more accurately identify its place in the market relative to a primary competitor. This helped the client determine plans for a new production facility and identify areas where it could differentiate vs. competitors in terms of production capacity, materials and more.

A Strategic SWOT is a tool for critically auditing your company and its competitive position and forces you to really hone in on specific actions to assess where your organization is today and where it could be in the future. Benefits of a Strategic SWOT analysis can help inform strategic business decisions such as introducing a new product or service offering, revised pricing strategies, a plan for counter moves against competitor’s activities, increased profit, reduction in operating costs and more.

Reach out to Nando Scola ( at Proactive Worldwide to learn more about how our expert SWOT analysis could benefit your business.