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SWOT was developed by Ken Andrews in the early 1970s. An assessment
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of strengths and weaknesses occurs as a part of organizational analysis; that is, it is an
audit of the company’s internal workings, which are relatively easier to control than
outside factors. Conversely, examining opportunities and threats is a part of

environmental analysis—the company must look outside of the organization to
determine opportunities and threats, over which it has lesser control.
Andrews’s original conception of the strategy model that preceded the SWOT
asked four basic questions about a company and its environment: (1) What can we
do? (2) What do we want to do? (3) What might we do? and (4) What do others
expect us to do?
Strengths and Weaknesses
A good starting point for strategizing is an assessment of what an organization
does well and what it does less well. In general good strategies take advantage
of strengths and minimize the disadvantages posed by any weaknesses. Michael
Jordan, for instance, is an excellent all-around athlete; he excels in baseball and golf,
but his athletic skills show best in basketball. As with Jordan, when you can identify
certain strengths that set an organization well apart from actual and potential
competitors, that strength is considered a source of competitive advantage. The
hardest thing for an organization to do is to develop its competitive advantage into
a sustainable competitive advantage where the organization’s strengths cannot be
easily duplicated or imitated by other firms, nor made redundant or less valuable by
changes in the external environment.
Opportunities and Threats
On the basis of what you just learned about competitive advantage and
sustainable competitive advantage, you can see why some understanding of the
external environment is a critical input into strategy. Opportunities assess the external
attractive factors that represent the reason for a business to exist and prosper. These
are external to the business. What opportunities exist in its market, or in the
environment, from which managers might hope the organization will benefit? Threats
include factors beyond your control that could place the strategy, or the business, at
risk. These are also external—managers typically have no control over them, but may
benefit by having contingency plans to address them if they should occur.
SWOT Analysis of Flat World Knowledge
Flat World Knowledge is a college textbook company (and the publisher of this
POM text!) that operates with the tagline vision of “Personalization and Affordability
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Changes Everything.”
Strengths
1. Great management team.
2. Great college business textbooks.
3. Experienced author pool.
4. Proprietary technology.
Weaknesses
1. Limited number of books.
2. New technology.
3. Relatively small firm size.

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