INTERNAL ANALYSIS

INTERNAL ANALYSIS
An internal analysis is a process where all the components that
interact within an organization are evaluated in order to identify
failures and areas of opportunity.
The main objective of this type of analysis is to find out the strengths
and weaknesses of your organization. It helps management in making
decisions for the development of corporate strategy, formulation, and
implementation procedures.
The internal analysis analyzes internal factors which are controllable.
This means that the company can influence and control these
elements. The company itself can adjust and modify internal aspects.
Types of internal analysis

Gap Analysis
Gap analysis finds out the gap between “where we are” (the existing
condition) and where “we want to be” (the target state). It identifies
the difference between a company’s goal and the existing condition of
operations. It also highlights the company’s weak areas. This
in-depth analysis helps to plan a sequence of actions to bridge the
gaps.
Strategy Evaluation
The strategy evaluation examines the outcomes and execution of
strategic plans.
It is beneficial to conduct a strategy evaluation on a regular basis to
ensure everyone’s understanding and their acts according to business
strategic plans.
You can review your company’s performance every six months or after
implementing a new business strategy.
An excellent strategic strategy is useless if it is not implemented.
 SWOT ANALYSIS
The SWOT analysis is a well-known and widely used business analysis
tool. It provides both internal and external company analysis. The analysis
is defined as
Strengths
Weaknesses
Opportunities
Threats.
Strengths and weaknesses are considered as internal factors of a
commercial firm in this research. It refers to the organization’s own
strengths and weaknesses. External elements analyzing the firm’s
performance are opportunities and threats. It focuses on the potential
profit and market sales.
 VRIO Analysis

VRIO analysis is an excellent method for examining the internal

environment analysis of a business. It is defined as valuable, rare,
inimitable, and Organized. It facilitates the organization of company
resources. VRIO is a framework that can assist you in creating long-term
competitive advantages.
If you want to build a plan to get a comparative benefit, you should think
about implementing the VRIO analysis tool. It will help you gain a better
knowledge of your assets and the added value of your organization.
OCAT
OCAT stands for Organizational Capacity Assessment Tool. It evaluates
internal performance across a variety of separate areas.
OCAT investigates the organizational structure in depth.
Its strength is to transform organizational capabilities into strategies. This
analysis increases the performance of the organization to new heights.
McKinsey 7S framework
The McKinsey 7S framework is a well-known business tool. It determines the level of
synchronization between departments and processes. This framework can be used
to identify the discrepancy between the present situation and the proposed future
state. It helps to investigate seven internal aspects of the company to achieve its
objectives. These are as follows:
Staff
Skill
Style
Shared values
Structure
System
Strategy
The McKinsey 7S framework provides an effective description of the organization’s
internal alignment.
Core competencies internal analysis
The core competencies analysis assists companies in developing their
market advantage. This may assist in beating their competitors. This
analysis helps to identify core strengths such as talents, information,
and resources that provide significant benefits to clients.
This one emphasizes intangibles rather than tangible resources. It
focuses on significant benefits that are also strategic and operative.
Why Conduct Internal analysis
It can help businesses strengthen their core activities. It assists corporate
executives in identifying methods to enhance their operations. Identifying
opportunities is one of the most essential reasons for conducting an
internal analysis.

Strengths of the company

Employee quality, the availability of critical resources, or customer brand
familiarity are all examples of strengths. Strengths aid a company’s overall
performance and sustainability, and finding strengths through an internal
study is useful.
Why Conduct Internal analysis
Weaknesses in the structure
Internal studies may assist in identifying a company’s weaknesses, which
could include issues such as ineffective training, outdated technology, or
inadequate interdepartmental communication. Weaknesses can have
modest effects on the firm, such as limiting the dissemination of internal
knowledge, or large implications, such as revenue loss.
Why Conduct Internal analysis
Opportunities for business
An internal examination may also be used to uncover commercial
prospects. A company’s opportunities generally involve both internal and
external growth. Upgrading the software system or launching a new
product are two examples.
Why Conduct Internal analysis
To Identify Future Threats
External risks are frequently encountered. Identifying future external risks
as part of an internal study. On the other hand, they may help businesses
react to them by maximizing corporate strengths, fixing weaknesses, and
opening up new growth prospects.
Why Conduct Internal analysis
Determining market viability
A market viability study can assist you in deciding whether or not
launching a firm in that market is financially viable. Finding a specialized
niche within the bigger market to set the firm apart from rivals is one of
the most beneficial advantages of an internal investigation. This is
frequently the long-term aim of an internal examination
How To Conduct Internal Analysis
1. Set your goals.
To start an internal analysis, you need to set a goal and reason first. You
must know what you want to achieve from internal analysis from the
beginning. Once you have a specific purpose or goal, it is easier to identify
the relevant data. The goal could be to identify new and creative
company opportunities.
2. Select an appropriate framework
After setting your goal, you should select the appropriate framework to
perform an internal analysis. Some frameworks are suitable to identify a
company’s weak areas and others are good at development. So it is
necessary to choose the right one to meet the needs. This will help you to
reach your goals or objectives
How To Conduct Internal Analysis

3. Conduct your research.

Do some research and collect data from all internal sources. You should
gather data from multiple sources, such as the company’s performance,
abilities, and assets.
4. Stick to the framework
Use the chosen framework to present the data. If you conduct a SWOT
analysis, you will be able to determine the company’s strengths,
weaknesses, opportunities, and threats based on your analysis. Present
all the findings separately.
How To Conduct Internal Analysis
5. Establish your priorities.
After implementing the information, analyze the framework. Identify and
compare it with the goals and objectives you set earlier. Find out all the
data that will help you in making a decision to achieve the goals. If you
want to improve your technological capacity, look for what equipment
needs to be updated.
6. Implement the findings.
Now implement your findings based on your analysis. If you want to meet
your objectives, then you should apply the changes you need. If
purchasing something is required, you should do so.