eco 2

• Opportunity


  A situation or condition favorable for attainment of a goal
• When entering into any opportunity, it is highly encouraged that we have a plan
• Behind the scenes, there is planning happening in the background for businesses
• Part of this planning process is evaluating the business to put it in the best position to succeed
• SWOT Analysis


  One of the most popular tools used in evaluating a business, taking into account strengths, weaknesses, opportunities, and threats
• SWOT analysis is typically done during the initial stages of the planning process
• SWOT analysis gives an opportunity to assess the situation, as well as identify external factors that might affect it
• Strengths


  Internal factors that focus on the positive characteristics of the organization, representing advantages one has over competitors
• Weaknesses


  Internal factors that focus on the negative characteristics of the organization, representing points of improvement that they need to work on
• Opportunities


  External factors that could potentially give the organization an advantage, different from strengths as these are external and potential advantages
• Threats


  External factors that could potentially harm the business or organization, not points for improvement and are outside of the control of the business
• The elements of a SWOT analysis are summarized in a table with internal/external and positive/negative factors
• SWOT analysis is popular among organizations because of its flexibility. It can be used to evaluate companies, businesses, or even events and initiatives
• SWOT analysis can also be used by managers to get the ball rolling in the earlier stages of planning
• The value of the SWOT analysis is dependent on how it is conducted, typically done internally and benefits from having multiple perspectives and reliable data
• A SWOT analysis done in a sloppy or uninformed manner could lead a business in the wrong direction or give them a false sense of security
• TOWS Matrix


  An external and internal factor from the SWOT analysis can be paired together to form a TOWS matrix, each pairing representing a different strategy the company can pursue
• Growth Strategies


  Focuses on the strengths of a business and how it helps it maximize an upcoming opportunity, yielding short-term positive gain
• Defusing Strategies


  Using the strengths of an organization to minimize the severity of a foreseen threat, does not yield positive growth but keeps negative impact of threats to a minimum
• Re-orientation Strategies


  Strategies that identify weaknesses that need to be addressed in order to maximize upcoming opportunities, timeline is typically more long-term and yields positive growth
• Defensive Strategies


  In situations where weaknesses and threats coincide, this strategy identifies how to address the situation and minimize damage, does not yield positive growth, but may be what keeps a business alive
• Porter's Five Forces


  Another common tool for analysis used by businesses to evaluate the competitive environment of a company, specifically with regards to its profitability
• Porter's Five Forces


  • Competition in the industry
  • Potential for new entrants into the industry
  • Power of suppliers
  • Power of consumers
  • Threat of substitute products