Monday, 8 August 2011


SWOT is the acronym for strength, weakness, opportunities and strengths whereas tows is the acronym for threats, opportunities, weakness and strengths Both refers to the same thing. SWOT or TOWS analysis use by the firm to develop strategies or We can say the set of possible strategies. Strategist prefer SWOT or TOWS MATRIX Because it Gives an alternative set of strategies the which help the firm to choose the strategies suit the firm in terms of available resources.

SWOT analysis is not only the part of strategic management, it's also the part of marketing, human resources and other business areas. In this tutorials We Will discuss the way to develop the TOWS matrix and its attributes in detail and also give examples to show firm develop strategies using a SWOT or TOWS matrix.

What are the Things need to be included in the SWOT or TOWS matrix?

SWOT or TOWS matrix as discussed above consist of strength, weakness opportunities and threats, using variety of these strategies are developed. The most common tabular form of the SWOT or TOWS is shown in the figure below.

I would like to explain strengths, weakness opportunities and threats before going into details to Make Easier for the readers unfamiliar to this topic.
Strengths are the strong areas or attributes of the company, the which are used to Overcome weakness and capitalize to take advantage of the external opportunities available in the industry.Weakness
Weakness are painful for the company means these are the weak factors, the which needs to be Improve in Future Otherwise if They exposed to the competitors They can take the advantage of it.
OpportunitiesOpportunities are the chances exist in the external environment, firm it depends whether the firm is willing to exploit the opportunities or may be They ignore the opportunities due to lack of resources.
Threats are always twisted for the firm, the minimum number of threats in the external environment of open many doors for the firm. Maximum number of threats for the firm Reduced Their power in the industry.
How to identify strengths, weakness, opportunities and threats for the TOWS Matrix?
Well, if you have Them Same question its a good one, finding strengths, weakness, opportunism and threats is deep thinking process. The best thing to do ask the decision maker, employee, strategic partners and customers as well about your good and bad points. The other way out to use some statistical and mathematical tool.In strategic management strengths and weakness are extracted from the IFE Matrix, opportunities and threats from EFE matrix.
Example of Wal-Mart Strengths, Weakness, Opportunities and ThreatsWal-Mart Strengths

* Customer oriented
* SAM'S Club customers Able to buy in bulk
* Super centers offer one stop shopping
* Satisfaction guaranteed programs promoting customer goodwill
* Buy from local merchants Pls possible
* Stock ownership and profit-sharing with employees
* Leads industry in information technology
* Ongoing development of its employees Strong community involvement

Wal-Mart Weakness

* No formal mission statement
* Membership only for SAM'S Club
* Keep poor performing employees on hand
* Old fashioned store policies
* Few women in top management and Minorities
Wal-Mart Opportunities

* Consumers want ease of shopping
* Internet shopping growing
* Dollar value Increasing
* Similar shopping patterns worldwide
* Retail sales expected to increase of
* Environment conscious consumers
* Elderly population growing
* The Asian market is virtually untapped by retail
* European Market untapped by retail

Wal-Mart Threats

* Regulation of Wal-Mart Pharmacies
* Small towns do not want the entry of Wal-Mart
* Bad media exposure for Kathie Lee Brand
* Variety of competition nationally, regionally and locally
* Substitute products more easily Because of intense competition

What type of strategies are the part of the TOWS Matrix?
The SWOT Matrix is ​​an Important matching tool that helps managers develops four types of strategies:

1. -SO strategies use a firm's internal strengths to take advantage of external opportunities.
2. WO-strategies are aimed at Improving Internal Weaknesses by taking advantage of external opportunities.
3. -ST strategies use a firm's strengths to avoid or Reduced the impact of external threats.
4. -WT strategies are defensive tactics directed at reducing internal Weaknesses and avoiding external threats.

Example of Pakistan State Oil TOWS Matrix

The TOWS matrix above shows the four types of strategies, SO PSO strategies are developed using the strengths to exploit external opportunities, WO strategies are developed to Overcome Weaknesses by utilizing the opportunities. ST strategies are developed by a PSO to minimize or Eliminate the threats using the internal strengths and last WT strategies are developed to avoid threat and minimize Weaknesses.


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