Definition and limitations of SWOT analysis, Porter’s five...

Definition and limitations of SWOT analysis, Porter’s five forces analysis and Ratio analysis SWOT Analysis All companies need certain strategy analysing tools to assess their ability or inability to do something. To be more precise, SWOT is an acronym, where S means Strengths, W means Weaknesses, O means Opportunities and T means Threats (Management study guide, 2009). This model suggests what strengths a company has which can help it prosper and what weaknesses it contains which might diminish its performance. Both strengths and weaknesses are internal factors of a company, which are easier to work on since company has control over it. Opportunities and threats are external†¦show more content†¦Ã¢â‚¬ ¢ SWOT cannot be reliable all the time because although it does put emphasis mainly on what might be strength and what might be a weakness but it does not explain it for the businesses as to how to evaluate what factor would go into what category (Firth, 2013). †¢ SWOT analysis can produce quite a lot of ideas but many of them are not usable (Queensland Gov, 2012). Porter’s five forces analysis â€Å"Competitive Strategy: Techniques for Analyzing Industries and Competitors† (Porter, 1980), a book by Michael E. Porter where he has explained how certain five competitive forces can help an organisation change its position in industry positively (Recklies, 2001). These five forces are: bargaining power of suppliers, bargaining power of customers, competitive rivalry within the industry, threat of new substitutes and threat of new entrants (Porter, 1980). This model has proven to be not only applicable in industry but market sector too (Berry, 2007). If these forces are highly intense then the ability of an organisation to generate profits can be in jeopardy to the extent it might be hard for it to continue. Thus management can use this analysis to identify what competitive force needs a particular strategy to make sure company is profitable and this way theyShow MoreRelatedRap Acca Obu8880 Words   |  36 PagesOXFORD BROOKES UNIVERSITY RESEARCH AND ANALYSIS REPORT â€Å"AN EVALUATION OF THE BUSINESS AND FINANCIAL PERFORMANCE OF D.G. KHAN CEMENT COMPANY LIMITED (DGKCC) BETWEEN 1 JULY 2004 AND 30 JUNE 2007† (Word count: 6,498) Presented by: KAMRAN KHALID ACCA reg. # 1431751 September 2008 CONTENTS Page No. 1. 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