What components does a SWOT analysis assess?

A SWOT analysis is a strategic planning tool made up of four key components: strengths, weaknesses, opportunities, and threats. This method allows businesses to evaluate their internal strengths and weaknesses alongside external opportunities and threats in their market environment.

Strengths refer to the internal attributes and resources that support a successful outcome, such as unique capabilities or a strong brand reputation. Weaknesses, on the other hand, highlight areas where the business may be lacking or could fall short in achieving its objectives.

Opportunities are external factors or trends that a business can capitalize on to gain a competitive advantage or expand its market share. Threats encompass external challenges or obstacles that could hinder the business's performance or profitability.

By examining each of these components, a SWOT analysis helps businesses formulate strategies that leverage their strengths, address their weaknesses, seize opportunities, and mitigate threats, thereby guiding better decision-making and planning processes.

The other options, while they may contain relevant business concepts, do not accurately capture the components of a SWOT analysis.