What is SWOT Analysis ?
SWOT stands for strengths, weaknesses, opportunities, and threats. It is sometimes referred as SLOT analysis with liabilities coming in place of weaknesses.
SWOT analysis evaluates a company against its peers, while GAP analysis is an internal evaluation to identify performance deficiencies.
SWOT analysis is done for long-term planning while GAP analysis is often done to reach short term goals.
SWOT analysis is often a comprehensive study evaluating many aspects and many competitors. GAP analysis can be very simple targeted towards fine-tuning one process.
Strengths – Advantages the company has over other competitors
Weaknesses – Areas that need improvement compared to competitors
Opportunities – Trends and market gaps to take advantage of
Threats – External factors that can threaten your business
Both SWOT analysis and GAP analysis are used to evaluate businesses, but different aspects of businesses. However, the output from one can be used as input for another and vice verse.
For example in the case of SWOT analysis, you need input from many people so the process should be transparent to everybody.