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The Matching Stage
The Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix helps managers develop four types of strategies:
SO (strengths-opportunities) Strategies
WO (weaknesses-opportunities) Strategies
ST (strengths-threats) Strategies
WT (weaknesses-threats) Strategies
The Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix is an important matching tool that helps managers develop four types of strategies.
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SO Strategies
use a firm’s internal strengths to take advantage of external opportunities
WO Strategies
aim at improving internal weaknesses by taking advantage of external opportunities
SO strategies use a firm’s internal strengths to take advantage of external opportunities. All managers would like their organization to be in a position in which internal strengths can be used to take advantage of external trends and events.
WO strategies aim at improving internal weaknesses by taking advantage of external opportunities.
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ST Strategies
use a firm's strengths to avoid or reduce the impact of external threats
WT Strategies
defensive tactics directed at reducing internal weakness and avoiding external threats
ST strategies use a firm’s strengths to avoid or reduce the impact of external threats. This does not mean that a strong organization should always meet threats in the external environment head-on.
WT strategies are defensive tactics directed at reducing internal weakness and avoiding external threats. An organization faced with numerous external threats and internal weaknesses may indeed be in a precarious position.
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SWOT Matrix
List the firm’s key external opportunities.
List the firm’s key external threats.
List the firm’s key internal strengths.
List the firm’s key internal weaknesses.
Match internal strengths with external opportunities, and record the resultant SO strategies.
The process of constructing a SWOT Matrix can be summarized in eight steps.
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Match internal weaknesses with external opportunities, and record the resultant WO strategies.
Match internal strengths with external threats, and record the resultant ST strategies.
Match internal weaknesses with external threats, and record the resultant WT strategies.