FINRA Series 86 Research Analyst Practice Exam

SWOT analysis is a strategic planning tool used by organizations to identify their internal Strengths and Weaknesses, as well as external Opportunities and Threats. This framework allows analysts and decision-makers to systematically assess an organization's position in relation to its competitors and market environment.

The "Strengths" component focuses on the internal attributes that give the organization a competitive advantage, such as unique resources or capabilities. "Weaknesses" point out internal factors that may hinder the organization’s performance, like resource limitations or areas where competitors outperform it. "Opportunities" are external chances to improve performance or gain a competitive edge, such as emerging market trends or regulatory changes. Lastly, "Threats" encompass external challenges that could jeopardize the organization's success, like increased competition or economic downturns.

SWOT analysis is widely used not only in business but also in various sectors including healthcare, education, and non-profits, making it a versatile and valuable tool for strategic planning and decision-making.