Lecture 12

Interrelation of Strengths,
Weaknesses with external
environment and SWOT model
 Contents
1. Introduction of SWOT and TOWS
2. Identification of Strengths and Weaknesses
3. Identification of Opportunities and Threats
4. Interrelation of Strengths, Weaknesses with Opportunities and
Threats
5. Link to the Requirements of P5 and P6
6. Link to the Requirements of M4(2)
7. Link to the Requirements of D2
1. Introduction of
SWOT and TOWS
 SWOT

• Systematically analyzing the organization’s internal factors (strengths and

weaknesses) and its external factors (opportunities and threats) is
commonly known as “SWOT” (or TOWS)

• The analysis of opportunities and threats cannot be absolute

• The true value of the SWOT approach is in their contribution to

formulating strategies
 SWOT Table

• What advantages does your • What could your organization

organization have? improve?
• What are the organization’s • What should your organization
competitive advantages?
S W avoid?

• What is the latest trend in the

O
T
• What are potential challenges?
industry?
• How would the competitors affect
• How does the change in the rule
your organization’s market share?
affect your organization?
 TOWS Matrix

External

Opportunities Threats

SO ST
Strengths
Strategies Strategies
Internal

WO WT
Weakness
Strategies Strategies
 TOWS Strategies

• SO: Use strength to take advantages of opportunities

• ST: Use strength to avoid threat

• WO: Take advantage of opportunity by overcoming

weaknesses

• WT: Minimize weaknesses and avoid threats

SWOT and TOWS =
Corporate strategy
2. Identification of Strengths
and Weaknesses
(From Internal environments)
 Internal factors

• Refers to all the factors that are within an organization

which impart strengths or cause weaknesses of
strategic nature.

• Controllable factors
 Internal factors

1. Core value or Mission or Vision; Core

2. Organizational structure; Competencies
3. Human resources; / Distinctive
4. Brand name or brand equity;
5. Financial strength/ factors;
6. Fix/physical assets; Market resources;
7. Technology base or Research and
Development.
 Suggestion for Cor value;
Mission, Vision
Criteria - Strengths identified - Weaknesses identified

CORE VALUE, - Are they suitable for the - They are NOT strong or
characteristics of the company? practical to lead the company to
MISSION or
- Will they lead the company to success
VISION
contribute much to the society?
(Giá trị cốt lỗi/ Sứ mệnh hoặc - They are NOT suitable for the
Tầm nhìn)
- Wil they help the company to
characteristics of the company
define how far it develop?
*Evidences to prove the
* Evidences to prove the
statement
statement
 Suggestion for Brand name
or Brand equity
Criteria - Strengths identified - Weaknesses identified

BRAND NAME - Is brand name famous and - The brand name is not famous.
or BRAND easy to be recognized by the - Some current scandals which reduce
EQUITY customer? the belief of customer
(Giá trị thương hiệu)
- The Value of brand equity? - Easy to be copied → name some
- Market share of the business similar brand names if so
* Evidences to prove the * Evidences to prove the statement
statement
 Suggestion for
Organizational structure
Criteria - Strengths identified - Weaknesses identified

Organizational - The type of structure is aligned - Is there any department in the

STRUCTURE with the objectives of the
(Cấu trúc quản trị của tổ company
chức)
- The structure is economical
and effective
* Evidences to prove the
statement
structure not working well or not
necessary?
- The link between different
departments is not strong and
effective?
* Evidences to prove the statement
 Suggestion for Human
Criteria - Strengths identified
HUMAN - Number of employees, number of
managers → How are these numbers,
RESOURCES
comparatively to the current competitors?
(Nhân sự)
- The good qualification and good skills of
the employees
-The international awards of managers or
employees.
*Evidences to prove the statement
resources
- Weaknesses identified
- The employees are not big
enough to develop the company or
the employees are much bigger
than the actual needs.
- The qualification and the skill are
not high
* Evidences to prove the statement
 Suggestion for Fiancial
structure
Criteria - Strengths identified - Weaknesses identified

FINANCIAL - Present the Structure of the capital: total assets, - Net profit this year increases not

STRUCTURE total owner equity and total liabilities → Will
(Cấu trúc về tài chính) they be strong, comparatively to the current
competitors?
- Is the company a Strategic customer of any
banks?
- The price of the company stock in the market?
→ Is this higher than its competitors?
➔ Evidences to prove the statement
much more than it were last year
- Profit before tax is not as
expected
- Liabilities is too much
- In fact, there exists some loss
investment or loss project
→Evidences to prove the statement
 Suggestion for Marketing
resources
Criteria - Strengths identified - Weaknesses identified

MARKETING - Marketing campaign is - Marketing strategy is not effective

RESOURCES effective to increase number or too much investment but not
(Tài nguyên về phát triển of customers much effective
thị trường) - Distribution network is - Management of distribution
large. network is not good.
* Evidences to prove the * Evidences to prove the statement
statement
 Suggestion for Fix Assest

Criteria - Strengths identified - Weaknesses identified

2.7. FIX/ - Number of fix asset of the - Management of physical

PHYSICAL company→ Is this larger than the asset is not strict and
ASSETS other competitors? effective which leads to
(Tài sản hữu - Name some big assets: factories, waste of using
hình) machines, robots… * Evidences to prove the
* Evidences to prove the statement statement
 Suggestion for Technology/
Research and Development
Criteria - Strengths identified - Weaknesses identified

TECHNOLOGY - Does the company apply the 4.0 - Not yet apply 4.0
based or technology? → What are they? technologies.
RESEARCH and - How much the companies invest - Application of 4.0 is not
DEVELOPMENT for research and development? → effective
(Nền tảng công nghệ hoặc
Nghiên cứu và phát triển) What is the success? - Research and development is
* Evidences to prove the statement not invested much
* Evidences to prove the
statement
 3. Identification of
Opportunities and Threats
(From External environments)
 Types of Environment

General environment
(PESTLE)

<TITLE>
Economic Non-economic

External
Internal environment
environment
The company

Immediate environment Public

Competitors
(Competitive environment)
Customers
Marketing
Suppliers intermediaries
22
 External environments

1. External environment: Immediate environment

(competitive/ operational/ micro)

2. External environment: General environment

(contextual/ macro)
 How to identify Opportunities and
threats

Conclude
Conclude
 Example: Toyota

• Japan to offer up to ¥800,000 in subsidies for electric vehicles

Opportunities or Threats ????

Source: https://www.japantimes.co.jp/news/2020/11/25/business/subsidies-electric-vehicles/
 Example: Lichi Vietnam

• Bac Giang's outbreak of Covid coincided with the lychee

harvest season
Opportunities or Threats ????

The companies
buying Lichee

Source: https://congthuong.vn/bac-giang-5-doanh-nghiep-thu-mua-xuat-khau-vai-thieu-sang-thi-truong-nhat-ban-156734.html
4. Interrelation of Strengths,
Weaknesses with
Opportunities and Threats
 Interrelation

Business decisions to deal with the

Impacts impacts

Impacts
 Interrelation

• The Opportunities and Threats are Uncontrollable factors. So the

companies needs to react/ adapt/ transform to deal with the impacts
• The Strengths and Weaknesses are the power/ resources for the
company to deal with the impacts
• After a time for adaption, the Strengths and Weaknesses even change
dramatically or transform because they are Controllable factors
• The key interrelations are the business decisions and the transformation
of Strengths and Weaknesses
 Interrelation
Example: Toyota

• Japan to offer up to ¥800,000 in subsidies for electric vehicles

Opportunities

Increase Market
Business decision
share in Europe:
5,3%
Toyota to invest $2.8bn for
R&D hub in green-car push Products
5. Link to the Requirements
of P5 and P6
 Link to Requirements of P5

Marketing
Technology based structure
To be continued with the or R and D
Selected company in P4: Fix assets
structure
Point out Main Requirement of P5 Brand name,
Brand equity
Financial
Human structure
resources

Core value, Organizational

= Mission and structure
Vision
Core distinctive/ 1
(At least, strength and 1
competencies Come from weaknesses must be fingered
(Năng lực vượt trội, điểm khác biệt) out)
 Link to Requirements of P6

To be continued with the

selected company in P4 (P6)
Requirement 1 Find and Present

Facts/ Findings of the business

(Business Decision)
General
environment
(Macro)

Impacts of Coming
Current Strengths and from Competitive
external
Weakness (Pointed out in P5) environment
environment (Micro)
6. Link to the Requirements
of M4(2)
 Remind of Requirements of M4

General To be continued with the Selected company in P4:

Main Requirement of M4(1) Main Requirement of M4(2)

Opportunities and Threats Strengths and Weaknesses

SWOT

Justify how SWOT influences

business decision making
Main requirement of M4(3)
Business decision making
 Link to Requirements of M4(2)
Marketing
Technology based structure
or R and D
Fix assets
To be continued with the
structure
Selected company in P4:
Brand name,
Brand equity
Requirement of P5
Financial
Human structure
resources

Organizational
= Core value,
Mission and structure
Vision
Core distinctive/
Requirement of M4(2)
competencies Come from
(Năng lực vượt trội, điểm khác biệt) if analyze many criteria well
7. Link to the Requirements of D2
 Link to Requirements of D2

To be continued with the General

environment
Selected company in P4 (Macro)

Present a Fact or Findings of Requirement 1

Competitive
1 Opportunity or 1 Threat environment
(Micro)

Various Business Changing

decisions objectives
THE END