What method can be used to examine both internal and external factors for a company?

The use of SWOT analysis is particularly effective for examining both internal and external factors that affect a company. The acronym SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. In this framework, strengths and weaknesses pertain to internal factors, referring to the company's resources, capabilities, and operational efficiencies or deficiencies. Conversely, opportunities and threats are oriented toward external factors, such as market trends, economic conditions, competitive dynamics, and regulatory influences.

By combining these internal and external perspectives, SWOT analysis provides a comprehensive overview of the business environment, helping managers to develop strategies that capitalize on strengths and opportunities while addressing weaknesses and mitigating threats. This dual-focus approach is why SWOT analysis is a widely utilized strategic planning tool among organizations.