Internal analysis.

Week Six. Internal Analysis
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For each of the weekly discussion forums:

Research and review sources, articles/books/etc.., which speak to the listed topics.

Attach the citation, PDF, or working URL of your source material, to the initial posting.

Answer and discuss the following questions pertaining to the assigned topics by mid-week Thursday. Remember to also comment on at least two other postings for full credit, by end of the week Sunday. See the Syllabus for more detailed instructions.

Compare and contrast SWOT analysis with Porter’s Value Chain.

Which method seems more useful for:

A new company
An established company
A company in distress

(POST 1 )

Compare and contrast SWOT analysis with Porter’s Value Chain.

Both SWOT and Porter’s Value Chain (PVC) focus on looking at how an individuals business can create value. SWOT appears to focus on the broader aspects of how a business creates value, where as Porter’s appears to focus on the more in depth aspects of a business. This is best seen when comparing the two and seeing that SWOT focus on the aspects of Strengths, Weaknesses, Opportunities, & Threats . Where as PVC is broken down into specifics sections which fall into two categories: Primary activities & Supporting activities. The Primary activities are Inbound logistics, Operations, outbound logistics, Marketing and sales, & Service. While the Supporting activities are Procurement, Human resource management, Technological development, & infrastructure.

Which method seems more useful for:

A new company
In my opinion SWOT appears to be more useful for a new company. This is because it allows for a company to take a good look at its self and come up with honest answers about there business model. If you can find your weaknesses early, fix them while maintaining your strengths then a business can only grow when new opportunities arise and stay strong under new threats.

An established company
In my Opinion , PVC would be more useful for an establish company. This is because once a brand has been established i would assume a company would have a good understanding on the values being taught in SWOT. Thus, it is time to make sure a business has crossed all their T’s and dot all their I’s. To do this, PVC would be more useful since it will allow for a in-depth view on all there processes and what is their current states.

A company in distress
For this, i would say SWOT is once again the most useful tool. If a company is in distress it is because it is either A) is not aware of its weakness hurting it B) Is not seeking out new opportunities or C) Is unaware that a new threat to their market has appeared. All three are identified and brainstormed in SWOT, thus it is the perfect model to follow for a company in distress. Once all of that has been established then if the company is still failing I would recommend PVC.

https://www.mindtools.com/pages/article/newTMC_05.htm
(Links to an external site.)

https://www.mindtools.com/pages/article/newSTR_66.htm

(POST 2)

Porter’s Value Chain and SWOT analysis are strategic management tools. Porter’s Value Chain focuses on various components for creating products or services. The SWOT analysis examines a company’s internal potential. Each method serves a specific purpose; however, both models are used in strategic decision-making and are beneficial for a thriving business.

Michael Porter breaks down the value chain into five primary activities. These primary activities are inbound logistics, operations, outbound logistics, marketing and sales, and service (Tarver, 2019). The main goal is to increase profitability across all activities. It is important to note that there are secondary activities that assist the primary. The supporting activities are procurement, human resource management, infrastructure, and technological development. This approach provides a company with a competitive advantage (Tarver, 2019).

The SWOT analysis, which stands for Strengths and Weaknesses (internal) and Opportunities and Threats (external), is a strategic tool that helps determine the success of a business, industry, product, or person (Hall, 2020). This approach focuses on internal potential but does compare elements of existing solutions and competitions. Essentially, the SWOT analysis helps identify competitive advantages and disadvantages (Hall, 2020).

Regarding which method is more useful for a company, it truly depends on the circumstances. The SWOT analysis is under criticism for using ambiguous terminology and no logical link to strategic implementation, among other issues (Wheelen, 2010). Moreover, Porter’s Value Chain is for companies that manufacture goods; however, most companies can adopt this analysis (Tarver, 2019). Because of this, a company (new, established, or distressed) should utilize both methods to obtain a structured and deliberate analysis. In either instance, a company is focusing on competitive advantage, which both models emphasize.

References

Tarver, E. (2019, May 26). What Are the Primary Activities of Michael Porter’s Value Chain?. In Investopedia. Retrieved from https://www.investopedia.com/ask/answers/050115/what-are-primary-activities-michael-porters-value-chain.asp
(Links to an external site.)

Hall, M. (2020, August 1). Porter’s 5 Forces vs. SWOT Analysis: What’s the Difference?. In Investopedia. Retrieved from https://www.investopedia.com/ask/answers/041015/whats-difference-between-porters-5-forces-and-swot-analysis.asp
(Links to an external site.)

Wheelen, Thomas J., Hunger J. David. (2010). ‘Environmental Scanning and Industry Analysis’ [PowerPoint presentation]. Available at: https://canvas.wayne.edu/courses/143760/pages/weekly-readings?module_item_id=2753248