Importance-Performance Analysis based SWOT analysis
SWOT analysis, a commonly uese tool for strategic planning, is traditionally a form of brainstorming. Hence it has been criticised that it is likely to hold subjective views of the individuals who participate in a brainstorming session and that SWOT factors are not prioritized by their significance thus it may result in an improper strategic action.While most studies of SWOT analysis have only focused on solving these shortcomings separately,this study offers an approach to diminish both shortcomings by applying Importance-Performance Analysis (IPA) to identify SWOT based on customer satisfaction surveys which produces priortized SWOT corresponding to the customersrsquo; perception. Through the use of IPA based SWOT analysis, it is expected that a organisation can efficiently formulate strategic planning as the SWOT factors that should be maintained or improved can be clearly identified based on customersrsquo;viewpoints.The application of the IPA based SWOT analysis was illustrated and evaluated through a case study of Higher Education Institutions in Thailand. The evaluation results showed that SWOT analysis of the case study accuratelyreflected the organisations situations thereby demonstrating the validity of this study.
1. Introduction
Understanding the business environment is central to a strategic planning process. Among the most important tools to facilitate such understanding is the SWOT analysis. It helps organizations to gain a better insight of their internal and external business environment when making strategic plans and decisions by analysing and positioning an organizations resources and environment in four regions: Strengths, Weaknesses, Opportunities and Threats.
SWOT analysis has been praised for its simplicity and has been in continued use since the 1960s. However in practice it cannot offer an efficient result and sometimes may lead to a wrong business decision. This is because the traditional approach of SWOT analysis is based on qualitative analysis in which SWOT factors are likely to hold subjective views of managers or planner judgments. Besides, SWOT factors in each region are either not measurable or ranked by the significance towards an organizationrsquo;s performance. In addition, the SWOT analysis should be evaluated by considering the customers perspective rather than being evaluated solely on the organizationrsquo;s point of view to ensure that the capabilities perceived by the organization are recognized and valued by the customers.
This deficiency in the traditional approach of SWOT analysis motivated our research to exploit the Importance-Performance Analysis (IPA), a technique for measuring customersrsquo;satisfaction from customer satisfaction survey to systematically generate prioritized SWOT factors based on customers perspectives.This in turn produces more accurate information for strategic planning. Specifically, strengths and weaknesses of the organisation are identified through an IPA matrix which is constructed on the basis of an organisations performance and the organisations importance. Opportunities and threats are obtained by comparing the IPA matrix of the organisation with that of its competitor.
This paper is structured as follows. Section 2 reviews the relevant literature including SWOT analysis and IPA. Section 3 introduces a framework of IPA based SWOT analysis. Subsequently, Section 4 illustrates the implementation of the proposed IPA based SWOT analysis at one department of a leading university in Thailand. Section 5 concludes this paper.
2. Literature review
This section reviews the literature relating to two main topics of the work reported in this paper: SWOT analysis and IPAF or a review of SWOT analysis, a general introduction to SWOT analysis is described and the research studies involved with quantitative SWOT analysis and customer oriented SWOT are investigated. An overview of IPA is provided where the main focus is approaches that have been used for measuring attribute importance.
2.1. SWOT analysis
SWOT analysis is a commonly used method for analyzing and positioning an organizationrsquo;s resources and environment in four regions: Strengths, Weaknesses, Opportunities, and Threats. Strengths and Weaknesses are internal factors that support and obstruct organizations to achieve their mission respectively. Whereas Opportunities and Threats are the external factors that enable and disable organizations from accomplishing their mission. By identifying the factors in these four fields the organization can recognize its core competencies for decision-making, planning and building strategies.
SWOT analysis is one of many tools that can be used in an organizations strategic planning process. Other tools that are commonly used for strategy analysis are PEST analysiFive Forces analysis, and 3C (Company-Customer-Competitor) analysis. Regarding the surveyconducted bythe Competitive Intelligent Foundation which received responses from 520 competitive intelligent (CI) professionals SWOT is the second-most frequently used analytic tool with 82.6% of respondents.
It was ranked after competitor analysis with 83.2% ofrespondents. Additionally, the survey based on the answers supplied by the Chief Executive Officers of wide range organizations in the UK shows that SWOT analysis is the most widely applied strategic tool by organizations in the UK (Gunn amp;Williams 2007). Recentlya survey about analytical methods used by enterprise in South African for environmental scanning also shows that SWOT analysis is the most frequently used analytic tool with 87% ofr
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Importance-Performance Analysis based SWOT analysis
SWOT analysis, a commonly uese tool for strategic planning, is traditionally a form of brainstorming. Hence it has been criticised that it is likely to hold subjective views of the individuals who participate in a brainstorming session and that SWOT factors are not prioritized by their significance thus it may result in an improper strategic action.While most studies of SWOT analysis have only focused on solving these shortcomings separately,this study offers an approach to diminish both shortcomings by applying Importance-Performance Analysis (IPA) to identify SWOT based on customer satisfaction surveys which produces priortized SWOT corresponding to the customersrsquo; perception. Through the use of IPA based SWOT analysis, it is expected that a organisation can efficiently formulate strategic planning as the SWOT factors that should be maintained or improved can be clearly identified based on customersrsquo;viewpoints.The application of the IPA based SWOT analysis was illustrated and evaluated through a case study of Higher Education Institutions in Thailand. The evaluation results showed that SWOT analysis of the case study accuratelyreflected the organisations situations thereby demonstrating the validity of this study.
1. Introduction
Understanding the business environment is central to a strategic planning process. Among the most important tools to facilitate such understanding is the SWOT analysis. It helps organizations to gain a better insight of their internal and external business environment when making strategic plans and decisions by analysing and positioning an organizations resources and environment in four regions: Strengths, Weaknesses, Opportunities and Threats.
SWOT analysis has been praised for its simplicity and has been in continued use since the 1960s. However in practice it cannot offer an efficient result and sometimes may lead to a wrong business decision. This is because the traditional approach of SWOT analysis is based on qualitative analysis in which SWOT factors are likely to hold subjective views of managers or planner judgments. Besides, SWOT factors in each region are either not measurable or ranked by the significance towards an organizationrsquo;s performance. In addition, the SWOT analysis should be evaluated by considering the customers perspective rather than being evaluated solely on the organizationrsquo;s point of view to ensure that the capabilities perceived by the organization are recognized and valued by the customers.
This deficiency in the traditional approach of SWOT analysis motivated our research to exploit the Importance-Performance Analysis (IPA), a technique for measuring customersrsquo;satisfaction from customer satisfaction survey to systematically generate prioritized SWOT factors based on customers perspectives.This in turn produces more accurate information for strategic planning. Specifically, strengths and weaknesses of the organisation are identified through an IPA matrix which is constructed on the basis of an organisations performance and the organisations importance. Opportunities and threats are obtained by comparing the IPA matrix of the organisation with that of its competitor.
This paper is structured as follows. Section 2 reviews the relevant literature including SWOT analysis and IPA. Section 3 introduces a framework of IPA based SWOT analysis. Subsequently, Section 4 illustrates the implementation of the proposed IPA based SWOT analysis at one department of a leading university in Thailand. Section 5 concludes this paper.
2. Literature review
This section reviews the literature relating to two main topics of the work reported in this paper: SWOT analysis and IPAF or a review of SWOT analysis, a general introduction to SWOT analysis is described and the research studies involved with quantitative SWOT analysis and customer oriented SWOT are investigated. An overview of IPA is provided where the main focus is approaches that have been used for measuring attribute importance.
2.1. SWOT analysis
SWOT analysis is a commonly used method for analyzing and positioning an organizationrsquo;s resources and environment in four regions: Strengths, Weaknesses, Opportunities, and Threats. Strengths and Weaknesses are internal factors that support and obstruct organizations to achieve their mission respectively. Whereas Opportunities and Threats are the external factors that enable and disable organizations from accomplishing their mission. By identifying the factors in these four fields the organization can recognize its core competencies for decision-making, planning and building strategies.
SWOT analysis is one of many tools that can be used in an organizations strategic planning process. Other tools that are commonly used for strategy analysis are PEST analysiFive Forces analysis, and 3C (Company-Customer-Competitor) analysis. Regarding the surveyconducted bythe Competitive Intelligent Foundation which received responses from 520 competitive intelligent (CI) professionals SWOT is the second-most frequently used analytic tool with 82.6% of respondents.
It was ranked after competitor analysis with 83.2% ofrespondents. Additionally, the survey based on the answers supplied by the Chief Executive Officers of wide range organizations in the UK shows that SWOT analysis is the most widely applied strategic tool by organizations in the UK (Gunn amp;Williams 2007). Recentlya survey about analytical methods used by enterprise in South African for environmental scanning also shows that SWOT analysis is the most frequently used analytic tool with 87% ofr
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