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IB Business Management: 
6.1 SWOT analysis
A SWOT analysis is a strategic planning tool used to identify and evaluate the internal Strengths, and Weaknesses, and external Opportunities, and Threats involved in a project, business venture, or in a business as a whole. It is a framework used to assess a company's competitive position and to develop strategic planning. 
Key learning outcomes:
  • Prepare a SWOT analysis for a business situation– BMT
  • Analyse an organisation's position using a SWOT analysis – BMT

IB Business Management Toolkit
​SWOT Analysis

SWOT analysis (strengths, weaknesses, opportunities, and threats) is a framework used to evaluate an organisation's competitive position and to develop strategic planning. SWOT analysis assesses internal and external factors, as well as current and future potential.

A SWOT analysis is designed to facilitate a realistic, fact-based, data-driven look at the strengths and weaknesses of an organisation, initiatives, or within its industry. The organisation needs to keep the analysis accurate by avoiding pre-conceived beliefs or grey areas and instead focusing on real-life contexts. Businesses should use it as a guide and not necessarily as a prescription.

Strengths. Strengths describe what an organisation excels at and what separates it from the competition: a strong brand, loyal customer base, a strong balance sheet, unique technology, and so on. For example, a hedge fund may have developed a proprietary trading strategy that returns market-beating results. It must then decide how to use those results to attract new investors.

Weaknesses. Weaknesses stop an organisation from performing at its optimum level. They are areas where the business needs to improve to remain competitive: a weak brand, higher-than-average turnover, high levels of debt, an inadequate supply chain, or lack of capital.

Opportunities. Opportunities refer to favorable external factors that could give an organisation a competitive advantage. For example, if a country cuts tariffs, a car manufacturer can export its cars into a new market, increasing sales and market share.

Threats. Threats refer to factors that have the potential to harm an organisation. For example, a drought is a threat to a wheat-producing company, as it may destroy or reduce the crop yield. Other common threats include things like rising costs for materials, increasing competition, tight labor supply. and so on.

​How to Use a SWOT Analysis

Internal. What occurs within the company serves as a great source of information for the strengths and weaknesses categories of the SWOT analysis. Examples of internal factors include financial and human resources, tangible and intangible (brand name) assets, and operational efficiencies.

Potential questions to list internal factors are:
  • (Strength) What are we doing well?
  • (Strength) What is our strongest asset?
  • (Weakness) What are our detractors?
  • (Weakness) What are our lowest-performing product lines?

External. What happens outside of the company is equally as important to the success of a company as internal factors. External influences, such as monetary policies, market changes, and access to suppliers, are categories to pull from to create a list of opportunities and weaknesses.

Potential questions to list external factors are:
  • (Opportunity) What trends are evident in the marketplace?
  • (Opportunity) What demographics are we not targeting?
  • (Threat) How many competitors exist, and what is their market share?
  • (Threat) Are there new regulations that potentially could harm our operations or products?

Example SWOT analysis: Starbucks

An example SWOT analysis for the Paper 1 case study

SWOT analysis explained

Example SWOT analysis: Tesla

An example SWOT analysis for the Paper 1 case study

SWOT Case Study Example: IKEA

IB Business Management 6.1 SWOT analysis
SUMMARY NOTES

IB Business Management toolkit: 6.1 SWOT analysis teaching and learning PowerPoint notes for HL and SL IB Business Management

PROGRESS CHECK  – Test your understanding by completing the activities below

You have a range of practice activities, interactive flash cards, exam practice questions, interactive quizzes and classroom games to ensure you and your students have complete mastery of the IB Business Management requirements for the 1.1 Introduction to business topic.

USE THE FLASHCARDS IN ALL STUDY MODES

IB Business Management
6.1 SWOT analysis
Student learning activity A
IB Business Management
6.1 SWOT analysis
Student learning activity B
IB Business Management
6.1 SWOT analysis
Exam practice questions I
IB Business Management
6.1 SWOT analysis
Exam practice questions II
IB Business Management interactive quizzes and classroom games
Test how well you know the IB Business Management toolkit 6.1 SWOT analysis topic with the interactive self-assessment quizzes below. Each interactive quiz selects 30 questions at random from a larger question bank so keep on practicing! Aim for a score of at least 80 percent.
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