Critique Of SWOT Analysis And Porter’s Five Forces

Critique of SWOT Analysis and Porter’s Five Forces. SWOT Analysis. Porter’s Five Forces. Usefulness of SWOT analysis and Porter’s Five Forces on analyzing competitive environment and strategic decision making. Reference.

Identifying the environment where the organisation works at is a critical part in strategic planning process. SWOT analysis is a tool which is used by many firms to evaluate the environment that they operate in. The framework which identifies strengths, weaknesses, opportunities and threats to decide the competitive position of the company is known as SWOT analysis (Seth, 2015). Through carrying out a SWOT analysis the advantages and disadvantages of the industry for the company can be identified. To build up a competitive nitch in the market, SWOT analysis helps. It is a major measurement which helps for the organisation to identify what is the best for the organisation and what is not good.

Through the SWOT analysis the company as a whole is analyzed. It provides a comprehensive analysis of the organisation, as it analyses both internal and external environments of the organisation (Velez Corzo, 2016). The direction of the organisation can be identified through the SWOT analysis as this shows the current position of the company and where it will be in the future. The goals and objectives can be established based on this analysis while evaluating what is best strategy to gain the set objectives.

An insight of the company’s position is provided to the company. As this is easily understandable, the company can implement the strategy effectively. With the insight provided through the analysis, company can develop the organisation as it will provide a holistic view of the organisation (Jeyarathmm, 2008).

When the SWOT analysis is used to identify the strategy and the competitive environment, the organisation has to be balanced on both positive and negative points. The analysis should maintain the positive and negative points and it should not be used in uncertain and turbulent environments. This should not be complex. It should be understood by every person (Velez Corzo, 2016). It should not be analyzed over the limit. The SWOT analysis should be used as a map which shows the route to the successful implementation of strategies of the company.