Management

1. Topic: SWOT Analysis
Malaviya
National Institute of Technology
Jaipur
Report
Submitted by:
Bhavanish Kumar Singh
2012UMT1402
B. Tech.
Metallurgical and Materials
Eng. Dept.
November 2015

2. 1
Contents
 Preface
 Introduction
 Definition of SWOT analysis
 Internal and External Factors
 Guidelines
 How to Use SWOT Analysis?
 Advantages
 Disadvantages
 Potential Uses of SWOT Analysis
 Case Studies
 References

3. 2
Preface
India is going through very interesting and challenging times both economically and
socially. This phenomenon makes us work towards social entrepreneurship. India is
creating its own new grounds of global learning and practice out of its own diversity,
complexity and philosophy. India's engagement with the world is dynamic and
constantly evolving. It is our responsibility to create managers who develop a
sustainable model leading to inclusive development.
The Department of Management Studies in MNIT Jaipur was started in the year
1996 as a Centre of Management Studies and Industrial Collaboration under self-
finance scheme. Since then, DMS has been playing a seminal role in the growth of
corporate sector and management education in India. We groom future business
leaders by following a judicious blend of theory and practice, using highly
innovative teaching pedagogy. The Department offers flagship MBA and Doctoral
programmes. It offers regular two year full-time Postgraduate degree in
Management to graduate engineers, architects, pharmacists and commerce
graduates. During last 16 years, around 600 students have completed their MBA
from this Department. The Department also offers full-time and part-time Doctoral
programme in Management. The Department of Management Studies would be in
line with premier B-Schools in the country. DMS aims at creating its own position
in the field of Management. The DMS will develop a separate Corporate Interaction
cell which will be responsible for regular interaction with industry, organizing
industry-specific development programmes, sponsorships and seminars. DMS is
looking towards tie-ups with the world’s renowned management schools for
interdisciplinary interaction, course development and student-exchange
programmes.

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SWOT Analysis
Strengths, Weaknesses, Opportunities, Threats
Principle: “Discover new opportunities. Manage and eliminate threats.”
Introduction
21st
century organizations find themselves operating in an environment that is
changing faster the ever before. The process of analyzing the implications of these
changes and modifying the way that the organization reacts to them is known as
business strategy. Strategy is the direction and scope of an organization over the long
term, which achieves advantage in a changing environment through its configuration
of resources and competences.
The role of a manager is unlikely to require to make decisions at the strategic level,
he may be asked to contribute his expertise to meetings where strategic concerns are
being discussed. He may also be asked to comment on the pilot schemes,
presentations, reports, or statistics that will affect future strategy. Whether he works
in a large MNC or a small organization, a good understanding of the appropriate
business analysis techniques and terminology will help him to contribute to the
strategic decision-making processes.
Fig.1- Strategic Planning Process

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The diagram above shows strategic planning process. Various tools are used in this
process. This knowledge will enable managers to take active and productive role
when asked to participate in the strategic decision-making process.
SWOT Analysis is a useful technique for understanding your Strengths and
Weaknesses, and for identifying both the Opportunities open to you and the Threats
you face. What makes SWOT particularly powerful is that, with a little thought, it
can help you uncover opportunities that you are well placed to exploit. And by
understanding the weaknesses of your business, you can manage and eliminate
threats that would otherwise catch you unawares. More than this, by looking at
yourself and your competitors using the SWOT framework, you can start to craft a
strategy that helps you distinguish yourself from your competitors, so that you can
compete successfully in your market.

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Definition of SWOT
“The SWOT analysis is a business analysis technique that an organization can
perform for each of its products, services, and markets when deciding on the
weaknesses of the organization, and opportunities and threats present in the market
that it operates in. The first letter of each these four factors creates the acronym
SWOT.”
As a manager, his role in any strategic planning is likely to involve providing
operational data to help assess the internal capabilities, and (depending on his job
function) he may also be asked to provide market intelligence.
The completion of a SWOT analysis should help to decide which market segments
offer the best opportunities for success and profitable growth over the life cycle of
the product or service. By specifying clear objectives and identifying internal and
external factors that are either helpful or not, a short and simple SWOT analysis is a
useful resource which may be incorporated into an organizations strategic planning
model.

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Strengths- Internal attributes that are helpful to the organization to achieving its
objective
Weaknesses – Internal attributes that are harmful to the organization to achieving
its objective
Opportunities – External factors that help the organization achieve its objective

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Threats - External factors that are harmful to the organization to achieving its
objective.
After identifying the SWOT’s, identification of the factors and their interdependence
helps clarify the steps needed to achieve the ending objectives

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Internal and External Factors
The aim of any SWOT analysis is to identify the key internal and external factors
that are important to achieving the objective. SWOT analysis groups key pieces of
information into two main categories:
Internal factors – The strengths and weaknesses internal to the organization.
The internal factors may be viewed as strengths or weaknesses depending upon their
impact on the organization's objectives. What may represent strengths with respect
to one objective may be weak-nesses for another objective. The factors may include
all of the 4P's; as well as personnel, finance, manufacturing capabilities, and so on.
External factors – The opportunities and threats presented by the external
environment. The external factors may include macroeconomic matters,
technological change, legislation, and socio-cultural changes, as well as changes in
the marketplace or competitive position. The results are often presented in the form
of a matrix.
Guidelines
Before carrying out a SWOT analysis, consider the following guidelines...
 Be realistic about strengths and weaknesses. When performing a SWOT
analysis on your business, be neither modest nor overly optimistic.

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 Consider answers from the company’s point of view and from the point of
view of customers, vendors, distributors, and others who do business with
them.
 Distinguish between where the organization is today and where it could be in
the future.
 Note that the SWOT is subjective. No two people will come up with the same
SWOT.
How to Use SWOT Analysis
Originated by Albert S Humphrey in the 1960s, SWOT Analysis is as useful now as
it was then. You can use it in two ways - as a simple icebreaker helping people get
together to "kick off" strategy formulation, or in a more sophisticated way as a
serious strategy tool.
Tip: Strengths and weaknesses are often internal to your organization, while
opportunities and threats generally relate to external factors. For this reason the
SWOT Analysis is sometimes called Internal-External Analysis and the SWOT
Matrix is sometimes called an IE Matrix.
A SWOT analysis can be used for:
 Workshop sessions
 Brainstorming meetings
 Problem solving
 Product evaluation
 Strategic planning
 Competitor evaluation
 Personal development planning
To help you to carry out a SWOT Analysis, write down answers to the following
questions.
Strengths:
 What advantages does your organization have?
 What do you do better than anyone else?

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 What unique or lowest-cost resources can you draw upon that others can't?
 What do people in your market see as your strengths?
 What factors mean that you "get the sale"?
 What is your organization's Unique Selling Proposition (USP)?
Consider your strengths from both an internal perspective, and from the point of
view of your customers and people in your market. You should also be realistic -it's
far too easy to fall prey to "not invented here syndrome. “Also, if you're having any
difficulty with this, try writing down a list of your organization's characteristics.
Some of these will hopefully be strengths! When looking at your strengths, think
about them in relation to your competitors. For example, if all of your competitors
provide high quality products, then a high quality production process is not a strength
in your organization's market, it's a necessity.
Weaknesses:
 What could you improve?
 What should you avoid?
 What are people in your market likely to see as weaknesses?
 What factors lose you sales?
Again, consider this from an internal and external basis: Do other people seem to
perceive weaknesses that you don't see? Are your competitors doing any better than
you? It's best to be realistic now, and face any unpleasant truths as soon as possible.
Opportunities:
 What good opportunities can you spot?
 What interesting trends are you aware of?
Useful opportunities can come from such things as:
1. Changes in technology and markets on both a broad and narrow scale.
2. Changes in government policy related to your field.
3. Changes in social patterns, population profiles, lifestyle changes, and so on.
Local events.
Tip: A useful approach when looking at opportunities is to look at your strengths
and ask yourself whether these open up any opportunities. Alternatively, look at your
weaknesses and ask yourself whether you could open up opportunities by
eliminating them.

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Threats
 What obstacles do you face?
 What are your competitors doing?
 Are quality standards or specifications for your job, products or services
changing?
 Is changing technology threatening your position?
 Do you have bad debt or cash-flow problems?
 Could any of your weaknesses seriously threaten your business?
Tip: When looking at opportunities and threats, PEST Analysis can help to ensure
that you don't overlook external factors, such as new government regulations, or
technological changes in your industry.
Further SWOT Tips
If you're using SWOT Analysis as a serious tool (rather than as a casual "warm up"
for strategy formulation), make sure you're rigorous in the way you apply it:
 Only accept precise, verifiable statements ("Cost advantage of US$10/ton in
sourcing raw material x", rather than "Good value for money").
 Ruthlessly prune long lists of factors, and prioritize them, so that you spend
your time thinking about the most significant factors.
 Make sure that options generated are carried through to later stages in the
strategy formation process.
 Apply it at the right level -for example, you might need to apply SWOT
Analysis at product or product-line level, rather than at the much vaguer whole
company level.
 Use it in conjunction with other strategy tools (for example, USP Analysis
and Core Competence Analysis) so that you get a comprehensive picture of
the situation you're dealing with.
Advantages
1. Low cost
2. Simplicity
3. Flexibility
4. Collaborative
5. Quickness
6. Since it’s qualitative, it can be used as a discussion tool

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7. A good first step before a more in-depth analysis or a good summary of
detailed findings
8. Takes into consideration of external business environment as well as internal
capabilities
Disadvantages
1. It may tend to persuade companies to compile lists rather than think about
what is actually important in achieving objectives
2. No suggestions for solving disagreements
3. Can become too focused on the short term
4. No obligation to verify statements or aspects based on the data or the
analysis
5. It also presents the resulting lists uncritically and without clear prioritization
Example SWOT
A start-up small consultancy business might draw up the following SWOT Analysis:
Strengths:
 We are able to respond very quickly as we have no red tape, and no need for
higher management approval.
 We are able to give really good customer care, as the current small amount of
work means we have plenty of time to devote to customers.
 Our lead consultant has strong reputation in the market.
 We can change direction quickly if we find that our marketing is not working.
 We have low overheads, so we can offer good value to customers.
Weaknesses:
 Our company has little market presence or reputation.
 We have a small staff, with a shallow skills base in many areas.
 We are vulnerable to vital staff being sick, and leaving.
 Our cash flow will be unreliable in the early stages.
Opportunities:
 Our business sector is expanding, with many future opportunities for success.
 Local government wants to encourage local businesses.

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 Our competitors may be slow to adopt new technologies.
Threats:
 Developments in technology may change this market beyond our ability to
adapt.
 A small change in the focus of a large competitor might wipe out any market
position we achieve.
As a result of their SWOT Analysis, the consultancy may decide to specialize in
rapid response, good value services to local businesses and local government.
Marketing would be in selected local publications to get the greatest possible market
presence for a set advertising budget, and the consultancy should keep up-to-date
with changes in technology where possible.
Key Points
SWOT Analysis is a simple but useful framework for analyzing your organization's
strengths and weaknesses, and the opportunities and threats that you face. It helps
you focus on your strengths, minimize threats, and take the greatest possible
advantage of opportunities available to you.
SWOT Analysis can be used to "kick off" strategy formulation, or in a more
sophisticated way as a serious strategy tool. You can also use it to get an
understanding of your competitors, which can give you the insights you need to craft
a coherent and successful competitive position. When carrying out your SWOT
Analysis, be realistic and rigorous. Apply it at the right level, and supplement it with
other option-generation tools where appropriate.
Potential Uses of SWOT Analysis
 Set Objectives– defining what the organization is intending to do
 Environmental Scanning– internal appraisals of the organizations SWOT, this
needs to include an assessment of the present situation as well as a portfolio
of products/ services and an analysis of the product/ service life cycle
 Analysis of existing strategies, this should determine relevance from the
results of an internal/external appraisal. This may include gap analysis which
will look at environmental factors.

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 Strategic issues defined– key factors in the development of a corporate plan
which needs to be addressed by the organization
 Develop new/revised strategies– revised analysis of strategic issues may mean
the objectives need to change
 Establish critical success factors– the achievement of objectives and strategy
implementation
 Preparation of operational, resource, projects plans for strategy
implementation
 Monitoring results– mapping against plans, taking corrective action which
may mean amending objectives/strategies
Case Studies:
1. British Airways
SWOT Analysis
Weaknesses
 Declining profitability
 Unfunded employee post-
retirement benefits
 Sluggish revenue growth
from key geographic
region
Strengths
 International operation
 Employee productivity
 Strong presence at London
Heathrow International
Airport
Opportunities
 Global airline market
 Increase in trans-pacific
cargo
 Growing Asia Pacific
market
Threats
 Rising aviation fuel prices
 Increasing competition
from low cost airlines
 Weak economic outlook
for the US and Eurozone
(Source: British Airways PLC)

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2. NOVOCULI
About the Company:
NovOculi, Inc. is a startup company that has designed—and plans to develop and
market ophthalmological surgical tools and a unique method of incisionless
refractive correction dubbed NICS (Non-Invasive Corneal Sculpting). Current
refractive techniques, like LASIK, require destruction of a portion of the protective
epithelial layer overlying the cornea of the eye and are accompanied by
complications resulting from this loss of protection. NovOculi employs a method
Weaknesses
Lack of funding: We require equity
investments in order to fund the first
two years of operation.
Lack of strategic relationships: We
don’t have relationships with the close-
knit group of medical device
distributors.
High costs: The refractive laser
required for NICS procedures is
expensive and difficult to obtain.
Strengths
Patented technology: We have
patents on NonInvasive Corneal
Sculpting (NICS) and two novel
devices.
FDA approval: No need to wait for
FDA approval.
Principal expertise: Our principals
have extensive experience with
refractive correction techniques.
Opportunities
Untapped market: Only 0.6% of the
available market has had laser
refractive surgery.
Fast growth: The demand for laser
refractive surgery has been doubling
each year.
R&D: Several potential partners,
including Stanford University, have
expressed strong interest in
conducting research with us.
Threats
Competition: External visual aids
(contacts and eye glasses), LASIK, and
non-surgical procedures are strong
competitors to the market.
Price erosion: The premium we can
charge is based on the price of existing
surgery options.

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involving iontophoresis, an ionic dye, and a wavelength-specific laser to accomplish
effective refraction without the troublesome destruction of epithelium.
Potential Strategies for Growth:
NovOculi needs to investigate its options for obtaining capital. Specifically, because
NovOculi is seeking equity investments, the company needs to look into venture
capital funding and angel investments. A weakness that may deter investors is
NovOculi’s lack of relationship with the medical device distribution community. A
great idea is worth nothing if it can’t be implemented well, and a key to
implementation in this case is a strong sales and distribution channel. NovOculi is
going to have to figure out how to build relationships with medical device
distributors, whether that means attending expensive industry conferences,
leveraging research relationships with institutions like Stanford University, or
developing incentives for the distributors.

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References
www.bplans.com
www.free-management-ebooks.com
Cadle, J, Paul, and Turner (2010), Business Analysis Techniques, 72 Essential
Tools for success, BCS The Chartered Institute for IT
Creative HRM website