As you know SWOT analysis is used to help a person or organization identify strengths, weaknesses, opportunities, and threats related to business competition or project planning. So, what are the limitations of SWOT analysis(es)?
I agreed SWOT is a good analytical tool. Following are just my personal experience on the limitations of SWOT:
It is only a snapshot tool i.e. the SWOT will change as time passes or surrounding environments / dynamics shift - SWOT can't be used as a deterministic tool to identify / measure the progress of a person or organization based on time passage (multiple SWOT snapshots are needed when want to identify / measure SWOT according to time passage)
Some SWOT factors can be intangible that need certain mechanism to quantify them objectively e.g. reputation / good will, workplace politics etc.
Some SWOT factors can be both e.g. strength & weakness / threat & opportunity as well i.e. how to classify them correctly e.g. a person that think fast can be productive and at the same time might jump into conclusion / over-reacted etc. Another example is frienemy (friend + enemy) etc.
The limitations always exist, because it depends on the depth, the greater or lesser accuracy of the analysis, as well as some subjectivity of the analysis.
In any case, it is an excellent element of analysis and strategic self-reflection that gives us pointers and guidance that may be relevant to achieving personal or business success ...
I agreed SWOT is a good analytical tool. Following are just my personal experience on the limitations of SWOT:
It is only a snapshot tool i.e. the SWOT will change as time passes or surrounding environments / dynamics shift - SWOT can't be used as a deterministic tool to identify / measure the progress of a person or organization based on time passage (multiple SWOT snapshots are needed when want to identify / measure SWOT according to time passage)
Some SWOT factors can be intangible that need certain mechanism to quantify them objectively e.g. reputation / good will, workplace politics etc.
Some SWOT factors can be both e.g. strength & weakness / threat & opportunity as well i.e. how to classify them correctly e.g. a person that think fast can be productive and at the same time might jump into conclusion / over-reacted etc. Another example is frienemy (friend + enemy) etc.
For background information, what is now commonly referred to as SWOT, is called the LCAG Model (1969). LCAG stands for Learned, Christensen, Andrews and Guth.
In its original version, it was meant to balance two broad views; 1) the internal strengths and weaknesses of a firm as well as the opportunities and threats outside the firm. What got lost in translation somewhere along the way, I guess, is; 2) balancing the personal values of those running the firm and the societal expectations. You could argue that the two are one and the same thing, but the second nuance is very instructive.
In modern times, the internal vs external view morphed into two (2) schools of thought; 1) the positioning school - closely associated with the work of M. Porter and; 2) the resource based view - associated with the work of Edith Penrose and others.
Without going into too much detail, the underlying idea in strategy analysis to conduct an external analysis as well as an internal analysis is a given, whether people go through the process of classifying things as strengths and weaknesses and opportunities and threats or not.
Net, SWOT is a short hand or a map in the strategy language. Some people conduct in depth internal analysis (7 S's Framework, Value Chain Analysis, Resources & Capabilities etc.,) and external analysis (5 Forces, Integration Vs Fragmentation, Growth Vs Decline, Consolidation Vs Fragmentation) as well as the broader macro analysis (Geo-politics, economic, technological, environmental) and I guess, you could add global dynamics as well.
It helps to provide a framework for organizing one's argument about an organization. It is not comprehensive and other framework has come out - PESTLE, DIAMOND and etc. Don't be constrained by the framework of SWOT.
Conducting the so-called "pure" SWOT, the list of strengths and weaknesses includes only those aspects of the activity that are known to the consumer (which requires additional research).
in practice, the formulation of the list of S,W,O,T is one of the main problems that determines the quality of the analysis.
A SWOT analysis may be limited because it: doesn't prioritise issues. doesn't provide solutions or offer alternative decisions. can generate too many ideas but not help you choose which one is best.
Moreover, categorizing aspects as strengths, weaknesses, opportunities and threats might be very subjective as there is great degree of uncertainty in market.
The SWOT analysis is a useful technique for understanding all sorts of situations in business and organizations. ... SWOT analysis is one very effective tool for the analysis of environmental data and information – for both, internal (strengths, weakness) and external (opportunities, threats) factors.
Most of the planners that I have dealt with do not even know the difference between external (OT) and internal (SW) factors that are the basis of SWOT. They just pull some SWOT from the air through "brainstorming" missing out key issues when the "capabilities & capacities" framework; the comparative framework and lastly the degree of "opportunities/impacts" using the Ansoff analytical framework (for weighting & scoring of the SWOT factors) to come to an objective and prioritized set of SWOT.....that is basically the issues most of the others blame on the "subjectivity" of SWOT as they do not use it properly in conjuntion with the other framework that is raised above.
The limitations of this analysis are justified by the conclusions drawn from this analysis. These conclusions are based, in most cases, on the general knowledge of the results available at that time. This weakness can be eliminated if the analysis is based on research results. realized, for the four basic factors of SWOT analysis.
I fully agree with what Mr. Moremi and Mr. Ping say. SWOT was one of the first ways to analyze strategy in organizations, but that was many years ago, before Porter for instance.
According to that, if you are dealing with a small company that has never done strategic planning and does not have the ressources to make deep analysis, then SWOT may work. But, if you are talking about a big and modern company, then Swot may be a weak analysis.
Which are its weaknesses?That in Swot things are either good or bad, white or black, without greys. In real life, the same thing can be good and bad, depending on how you look at it, and also it can be neutral.
• From my own experiences I think that SWOT is irrespective of time and change, and is a static approach that loses or decreases its effectiveness as the change intensifies. Second, recognizing weaknesses and strengths or threats and opportunities rather than being objective is subjective, referring to the abilities and personality traits of a planner or strategy analyst and differentiating their individual differences.
In my viewpoint , SWOT analysis provides overview of a company's situation, but it is based on information provided to the analytical team ,which, if wrong or false , impacts the results of the analysis.
Hey, since analysts are human beings who communicate with the outside world based on their mental models and differentiate what is out there based on their knowledge, attitude, values and tendencies, and What may be considered one strength for another weakness or what is an opportunity for one may be threatened by another, and vice versa.
SWOT is a comparative static analysis tool. It does not a provide a dynamic path on how an organization goes through over time to achieve its goals. As expectations are more demanding, SWOT is no longer as popular though it is still used to teach the fundamentals.
I consider that the use of the SWOT matrix for managerial diagnosis is a fudamental tool mainly for public or proven organizations; Unfortunately, this matrix is used for all subjects, which require a very particular or specific treatment; In this sense, in order for the results of the diagnosis and the definition of strategies, other actions to be successful, it is necessary to elaborate with the participation of all members, from top management to the lower levels of the organization, because all have their reality, different from when a group of experts from the organization meet to develop the SWOT matrix. Based on this experience, I wrote in my last book published by Amazon entitled "Local Sustainable Human Development: A strategic look", what I called the FLOR Matrix (Strengths, Limitations, Opportunities and Risks) for sustainable communities, which applied with the participation of the communities and other actors involved, allowed to define more real and local strategies and actions. I invite you to read in my book and I will appreciate your comments.