What is a SWOT analysis?

SWOT organizes factors into an internal/external and positive/negative grid, giving a structured snapshot of where a business stands.

The four quadrants

• Strengths (internal, positive) — what the business does well, like a strong brand or loyal customer base
• Weaknesses (internal, negative) — internal limitations, like limited cash flow or outdated technology
• Opportunities (external, positive) — favorable outside conditions to exploit, like a growing market or new technology trend
• Threats (external, negative) — outside risks, like new competitors or changing regulations

Teams typically use a SWOT analysis at the start of strategic planning — before launching a new product, entering a new market, or setting yearly goals — to ground decisions in an honest assessment of the current situation.