DECA Entrepreneurship Practice Exam

A SWOT analysis is a strategic planning tool that helps businesses identify their internal strengths and weaknesses, as well as external opportunities and threats. This framework serves as a comprehensive way to assess both the internal environments of an organization and the external factors that could influence their strategic planning.

Strengths refer to the attributes that give a company an advantage over others. This could include strong brand recognition, skilled workforce, or proprietary technology. Weaknesses are areas where a company may be lacking compared to competitors, such as limited resources or gaps in expertise.

Opportunities encompass external factors that the organization can capitalize on for growth or improvement, such as emerging markets, technological advancements, or shifts in consumer behavior. Threats are external challenges that could negatively impact the organization, like increased competition, regulatory changes, or economic downturns.

This holistic view provided by a SWOT analysis assists in strategic decision-making, allowing businesses to align their resources and capabilities with the realities of the competitive landscape. Ultimately, it fosters a better understanding of where to focus efforts for future success and sustainability.