An organization is an establishment that is formed to achieve a set goal. It requires various resources, including workforce, financial resources, assets, land, raw materials, etc., to deliver the promised outcome, i.e., demand. More often, organizations get so engrossed in meeting the day-to-day business requirement that it underestimates or underutilizes the resources and relinquishes potential opportunities without realizing it. Hence, from time to time, assessment of the organization can bring enormous benefits in the long run. For such assessments, most firms rely on external auditing tools and firms to evaluate their business operations.
The evaluation of an organization is to assess the factors, i.e., positive and negative, that influence the business operations. SWOT is the popular analysis tool that aids firms in assessing such factors. The factors include both internal as well as external. SWOT stands for S â€“ Strength W- Weakness O- Opportunities T- Threat
Strength â€“ Strength factors summarize overall organizations’ strong elements that are not found in competitors. It is an internal analysis of the organizationâ€™s core proficiencies and resources. Weakness â€“ No organization is perfect; no matter how large or established the entity is, they still lack some things. SWOT analysis can unleash some factors which are affecting or impacting the overall performance of an organization. Some could be the organizationâ€™s location, poor leadership, poor cost management, noncompliance to audit, etc. Opportunities – This analysis helps organizations to unveil potential and feasible business opportunities that exist in the road map. Some of them are up-gradation to the modern tools and technology to increase efficiency, uplifting hiring criteria for skills and qualification to increase production, Business expansion, effectiveness and efficiency in cost management, etc. Threats – Threats are the most vital and critical analysis that a firm cannot ignore. They are important to evaluate reason, and they are large contributors that are directly or indirectly hampering business activities or have the potential to do so. Some factors call fall into one or more categories of SWOT. For example, competition, regulations, and norms by government, labor laws, location of the organization, etc.
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