# SWOT Analysis

> **Core Value**: Synthesize scattered analytical findings into structured strategic judgments
>
> **Creator**: Albert Humphrey, Stanford Research Institute (1960s)
>
> **One-liner**: The "synthesizer" of all analysis frameworks — consolidate internal and external factors into actionable strategic directions

---

> **Case Boundary**: Company/industry cases in this file are illustrative examples for framework structure and reasoning, not current factual claims by Alpha Insights. Before reusing any numbers, shares, dates, or conclusions in a live study, re-check sources and record them in the Evidence Claim Ledger.

## Overview

SWOT Analysis was developed by Albert Humphrey at Stanford Research Institute in the 1960s and is the most classic strategic synthesis tool in strategic management.

**Core Design Principles**:
- **Internal vs. External Separation**: Internal factors (S/W) and external factors (O/T) are strictly distinguished
- **Data-Driven**: Every element must be supported by data or evidence
- **Cross-Analysis**: Use the TOWS matrix to convert four quadrants into actionable strategies

**Best Use Cases**:
- **Final stage of all analyses**: SWOT is a "synthesizer," not the first analysis performed
- Comprehensive judgment before strategic decisions
- Competitive strategy formulation

**Output Value**:
- Structured summary of internal and external factors (Top 3-5 per quadrant)
- Four strategic directions generated through TOWS cross-analysis

---

## Framework Overview

```
              Internal Factors               External Factors
        ┌──────────────┐          ┌──────────────┐
  Favorable │  S trengths   │          │ O pportunities│
        │               │          │               │
        ├──────────────┤          ├──────────────┤
  Unfavorable│  W eaknesses  │          │  T hreats     │
        │               │          │               │
        └──────────────┘          └──────────────┘
              ↑                          ↑
         From Value Chain              From PESTEL
         BMC / Internal Data         Five Forces / SCP
```

**Key Insight**: SWOT is not the first analysis you do — it is the **final synthesis**. First conduct deep analysis using other frameworks (PESTEL, Five Forces, Value Chain, etc.), then use SWOT to consolidate conclusions.

---

## Why SWOT Is Often Done Poorly

SWOT is the most used and most poorly done strategic tool. 90% of SWOT analyses produce zero value — four quadrants are filled, readers finish with zero action direction.

### Four Fatal Problems

| Common Problem | Bad Example | Good Example | Consequence |
|---------|---------|---------|---------|
| **Empty, no data** | "Strong brand awareness" | "Brand aided awareness 92% (QuestMobile 2025Q1), ranked #1 in segment, leading second place Starbucks by 18 percentage points" | Cannot determine how "strong," cannot compare to competitors, cannot track changes |
| **Internal/external confusion** | Placing "coffee market growing fast" under S (Strengths) | Market growth is an external opportunity (O): "China per-capita coffee cups 16.7/year, only 1/12 of Japan, massive penetration upside" | Logical confusion causes cross-analysis to fail — internal strengths cannot "leverage" another internal factor |
| **No prioritization** | Listed 10 strengths and 10 weaknesses, flat narrative | Top 3-5 per quadrant, ranked by strategic impact, annotated "can this factor change the competitive landscape" | Nothing memorable, decision-makers cannot judge priorities |
| **No cross-analysis** | Four quadrants listed independently, done with "strengths outweigh weaknesses" | Mandatory TOWS cross-analysis, outputting 4 strategic directions (SO/WO/ST/WT), each with 2-3 specific actions | No strategic direction produced; SWOT becomes "advanced pros-and-cons list" |

### Detailed Comparison: Luckin Coffee Example

**Bad SWOT** (what you see in 99% of consulting reports):

> S: Strong brand awareness, many stores, strong digital operations
> W: Brand not premium, franchise control difficult
> O: Coffee market is large, lower-tier market potential
> T: Fierce competition, raw material price increases
>
> Conclusion: Luckin has clear advantages, should continue expanding strengths and addressing weaknesses.

**Problem**: Remove "Luckin" and replace it with any chain restaurant — it still works. **No data, no ranking, no cross-analysis, no action direction.**

**Good SWOT** (this framework's requirement):

> **S1**: 31,048 stores (end of 2025), world's largest freshly brewed coffee chain, 4.1x Starbucks China (~7,600 stores). Density advantage = convenience moat
> **O2**: Lower-tier coffee penetration <8%, Tier 3-4 city growth 35%+ (vs. Tier 1-2 <12%)
> **SO Strategy (Offensive)**: Use10,000-storescale + supply chain cost advantage to accelerate lower-tier layout, target 2026 Tier 3-4 store share from 38% to 50%
> - Action 1: Franchise model lowers toto county-level cities, single-store investment capped at RMB 250k
> - Action 2: Launch region-limited products (e.g., Osmanthus series) to boost localization penetration
> - Action 3: Partner with Meituan/Douyin local life, use "RMB 9.9 in-store pickup" to cultivate lower-tier user habits

**The gap is obvious**: good SWOT has data, ranking, cross-analysis, and specific executable actions.

### Four Enforcement Rules of This Framework

1. **Data riveting**: Every element must carry at least one quantitative data point (market share, revenue, growth rate, penetration, etc.). Pure qualitative descriptions are not accepted
2. **Source tracing**: S/W must annotatewhich upstream framework they come from (Value Chain / internal data / competitive comparison); O/T must annotatefrom PESTEL / Five Forces / industry data
3. **Ranking and focus**: Top 3-5 items per quadrant, ranked by "ability to change competitive landscape." No flat listing of 10+ items
4. **Cross-analysis mandatory**: TOWS matrix is the core output, not an appendix. Each cross strategy must have 2-3 specific actions, and actions must be measurable

---

## Execution Steps

### Step 1: Collect Inputs (Summarize from Upstream Frameworks)

| SWOT Dimension | Input Source |
|---------------|-------------|
| **S Strengths** | Value Chain analysis, internal data, areas of advantage in competitive benchmarking |
| **W Weaknesses** | Value Chain analysis, internal data, areas of disadvantage in competitive benchmarking |
| **O Opportunities** | Favorable trends from PESTEL, low-threat areas in Five Forces, market gaps |
| **T Threats** | Unfavorable trends from PESTEL, high-threat areas in Five Forces, competitor actions |

### Step 2: Structured Population (with Data Support)

Each element must include:
1. **Element description** (specific, not vague)
2. **Data/evidence support**
3. **Importance rating** (High/Medium/Low)

**Example**:

❌ Bad S: Strong brand awareness
✅ Good S: Brand recognition rate 92% (source: QuestMobile), ranked #1 in segment, leading second place by 40 percentage points

### Step 3: Priority Ranking

Retain **Top 3-5** most important elements per quadrant, ranked by importance. Do not list more than 5.

### Step 4: Cross-Analysis (TOWS Matrix) — **Core Step**

This is where SWOT generates strategic value. Cross-reference four quadrants pairwise to generate four strategic directions:

```
              Strengths (S)           Weaknesses (W)
            ┌─────────────────┬─────────────────┐
Opportuni-  │  SO Strategy      │  WO Strategy      │
ties (O)    │  Use strengths     │  Overcome weak-   │
            │  to seize          │  nesses to seize  │
            │  opportunities     │  opportunities    │
            │  (Offensive)       │  (Turnaround)     │
            ├─────────────────┼─────────────────┤
Threats (T) │  ST Strategy      │  WT Strategy      │
            │  Use strengths     │  Avoid weaknesses │
            │  to counter        │  being amplified  │
            │  threats           │  by threats       │
            │  (Defensive)       │  (Retreat/Exit)   │
            └─────────────────┴─────────────────┘
```

| Strategy Type | Core Logic | Applicable Scenario |
|--------------|-----------|---------------------|
| **SO Strategy** | Leverage strengths to capture opportunities | Best-case offensive strategy |
| **WO Strategy** | Seize opportunities to address weaknesses | Good market but self-improvement needed |
| **ST Strategy** | Use strengths to defend against threats | Defense when external environment deteriorates |
| **WT Strategy** | Minimize weaknesses, avoid threats | Baseline strategy in worst-case scenarios |

### Step 5: Strategic Recommendation Ranking

From the four strategies, select **1-2 primary offensive directions**, complemented by 1 defensive direction.

---

## Output Format

```markdown
## SWOT Analysis: [Analysis Subject]

### Four-Quadrant Summary

| | Favorable | Unfavorable |
|---|-----------|-------------|
| **Internal** | **S1**: [Strength 1] [data support] | **W1**: [Weakness 1] [data support] |
| | **S2**: [Strength 2] [data support] | **W2**: [Weakness 2] [data support] |
| | **S3**: [Strength 3] [data support] | **W3**: [Weakness 3] [data support] |
| **External** | **O1**: [Opportunity 1] [data support] | **T1**: [Threat 1] [data support] |
| | **O2**: [Opportunity 2] [data support] | **T2**: [Threat 2] [data support] |
| | **O3**: [Opportunity 3] [data support] | **T3**: [Threat 3] [data support] |

### Cross-Strategic Analysis (TOWS)

#### SO Strategy (Offensive): [Strategy Name]
- Leverage [S1/S2] to seize [O1/O2]
- Specific actions: [...]

#### WO Strategy (Turnaround): [Strategy Name]
- Use [O1/O2] to address [W1/W2]
- Specific actions: [...]

#### ST Strategy (Defensive): [Strategy Name]
- Use [S1/S2] to counter [T1/T2]
- Specific actions: [...]

#### WT Strategy (Baseline): [Strategy Name]
- Prevent [W1/W2] from being amplified by [T1/T2]
- Specific actions: [...]

### Recommended Strategic Priority
1. **Primary Offensive**: [SO/WO strategy name] — [rationale]
2. **Defensive**: [ST strategy name] — [rationale]
```

---

## Case Studies

### Case 1: Luckin Coffee SWOT-TOWS Deep Analysis (2025)

> **Why This Case**: Luckin is the best textbook for "SWOT done right vs. done wrong" — 31,048 stores making it the scale champion, yet facing a strategic dilemma of rising revenue without rising profit. All four quadrants have strong data anchors, and TOWS cross-analysis produces clear strategic directions.

#### Background Snapshot

- 2025 total net revenue RMB 49.288 billion (+43.0% YoY), net profit RMB 3.6 billion (+21.6%)
- Total stores 31,048 (net add 8,708, +39%), world's #1 freshly brewed coffee chain
- Fresh beverage sales 4.1 billion cups; self-operated revenue RMB 36.243B (+41.6%), franchise revenue RMB 11.594B (+49.7%)
- Q4 net profit RMB 518M (-39.1% YoY), delivery costs up RMB 4B YoY — "delivery war" eroding profit

---

#### Four-Quadrant Analysis (Data as of end-2025)

| | Favorable | Unfavorable |
|---|-----------|-------------|
| **Internal** | **S1**: Store scale 31,048, 4.1x Starbucks China (~7,600). Density = convenience moat; Tier 1-2 users >85% probability of reaching within 5-min walk | **W1**: Brand locked as "budget fast food" — business/gifting scenario penetration <5%, ASP RMB 15-20 (Starbucks RMB 40+), clear premium ceiling |
| | **S2**: Digital operations — 94% orders via APP, 67M+ monthly transacting customers, "thousands of faces" recommendation, per-cup marketing cost <RMB 1 | **W2**: Franchise QC risk — multiple franchise hygiene incidents trending 2024-2025; franchise revenue share rose to 23.5%, but QC investment didn't grow proportionally |
| | **S3**: Supply chain moat — Kunshan+Fujian self-built roasting factories (annual capacity >50k tons), global procurement + futures hedging, raw material costs 30%+ lower than independent shops, 10-15% lower than peers | **W3**: Product homogenization — 9.9 RMB hit strategy pushes product line "milk tea-ification" (Coconut Cloud/Cheese series), weak specialty coffee mindshare; 100+ new products/year but hit rate only ~15% |
| | **S4**: Innovation speed — data-driven product selection (200+ user taste tags), R&D to market 2-3 weeks (Starbucks 6-8 weeks) | **W4**: "Rising revenue, falling profit" structural issue — Q4 delivery costs surged RMB 4B (delivery war), operating margin dropped from 10.5% to 4.1% |
| **External** | **O1**: China per-capita coffee 16.7 cups/year, only 1/12 of Japan, 1/23 of US — penetration growth is highly certain | **T1**: Cotti Coffee 8.8 RMB price war + full-year loss-for-scale (>10,000 stores), directly attacking 9.9 RMB price tier |
| | **O2**: Lower-tier coffee penetration <8%, Tier 3-4 growth 35%+ (vs Tier 1-2 <12%), last incremental stronghold | **T2**: Mixue Bingcheng "Lucky Coffee" RMB 4 coffee + 40,000-store network, disrupting from even lower end |
| | **O3**: Tea-coffee fusion category growth 60%+, customer overlap >70%, Luckin first-mover advantage (Coconut Latte cumulative >1B cups) | **T3**: Arabica bean prices up 80%+ (2024-2025, climate + demand dual drive), continuous cost transmission |
| | **O4**: Overseas — Southeast Asia coffee culture compatibility high (Indonesia 280M population), Singapore 40+ stores validating model | **T4**: Delivery platform subsidy war — Meituan/Ele.me fighting for coffee delivery share, delivery costs becoming profit black hole (Q4 delivery cost ratio >15%) |

---

#### TOWS Cross-Strategic Analysis

**SO Strategy (Offensive): Scale + supply chain accelerate lower-tier**

Use S1 (10,000-store density) + S3 (supply chain cost) to capture O2 (lower-tier increment):
- Franchise model lowers toto county-level cities, single-store investment <RMB 250k, 6-8 month payback. Target 2026 Tier 3-4 store share from 38%→50%
- S4 (data-driven product selection) × O3 (tea-coffee fusion): Launch region-limited flavors (Osmanthus/Tangerine Peel series), already verified Coconut Cloud regional variant contributes 12% increment in South China
- S2 (digital) × O2: Use "RMB 9.9 in-store pickup" to cultivate lower-tier user habits, then membership system boosts ASP

**WO Strategy (Turnaround): Ride penetration upside to break brand ceiling**

Leverage O1 (low coffee penetration = upscale space) to address W1 (weak brand premium):
- Launch "Luckin Select" sub-brand, positioned at RMB 25-35 price tier, targeting business/social scenarios, independent store format
- O4 (overseas) × W1: Enter Southeast Asia as "Chinese specialty coffee" positioning (not budget), avoiding domestic brand impression becoming fixated
- Risk warning: Brand upward extension success rate historically <30%, requires independent team and channels

**ST Strategy (Defensive): Digital + membership build price-war moat**

Use S2 (digital operations) to counter T1 (Cotti price war) + T4 (delivery subsidy war):
- Membership subscription lock-in (monthly/quarterly cards), existing data: member repurchase rate >60% (vs non-members <25%)
- S3 × T3: Increase futures hedging ratio, sign 2-3 year long-term supply contracts, use scale to lock in price advantage
- Pilot self-operated delivery in high-density cities, reduce platform dependency, control T4 costs

**WT Strategy (Baseline): Tighten franchise, prevent weaknesses from being amplified**

Prevent W2 (franchise QC) from being squeezed by T1/T2 (competitive attacks):
- Franchise stores introduce "flight inspection" + AI operational compliance monitoring; non-compliant stores closed after 30-day rectification
- W4 × T4: Cut low-margin delivery SKUs, delivery radius 5km→3km, use "in-store pickup discount" to guide channel optimization
- Franchise store share cap at 40%, prevent scale expansion from spiraling out of control

---

#### Real-World Validation: What Did Luckin Actually Do in 2025?

| Strategic Direction | Actual Action | Outcome |
|---------|---------|---------|
| SO (Lower-tier expansion) | Net add 8,708 stores, 60%+ in Tier 3-4 | ✅ Broke 30,000 stores, but lower-tier single-store revenue 20-30% below Tier 1-2 |
| WO (Brand upscale) | No independent sub-brand launched yet | ⏳ Not substantially initiated |
| ST (Membership defense) | Membership system iterations, monthly card user growth | ✅ 67M+ monthly transacting customers, but price war continues |
| WT (QC tightening) | Franchise QC issues still trending | ⚠️ Shortcoming unresolved, Q4 margin decline partially attributed to this |

**Key Conclusion**: Luckin 2025 focused on SO+ST, WO brand upgrade not launched, WT QC still exposed — TOWS analysis can foreseestrategic blind spots in advance.

### Case 2: BYD SWOT-TOWS Deep Analysis (2025)

> **Why This Case**: BYD is the textbook case of "rising revenue, falling profit" — RMB 804B revenue global top 5, yet net profit declined 19%. Internal advantages are extremely strong (vertical integration), external threats are complex (tariffs + price war + ADAS competition). TOWS cross-analysis reveals core strategic tradeoffs.

#### Background Snapshot

- 2025 revenue RMB 803.965B (+3.46% YoY), first time exceeding RMB 800B
- Net profit attributable to parent RMB 32.619B (-18.97%), gross margin dropped from 19.44% to 17.74%
- Global sales 4.6M units (first time entering global top 5), NEV sales global #1
- Overseas sales 1.05M (+145% YoY), covering 119 countries, overseas revenue RMB 310.7B (38.6% share)
- Employees 970k→870k (100k layoffs), cash reserves RMB 167.8B

---

#### Four-Quadrant Analysis (Data as of end-2025)

| | Favorable | Unfavorable |
|---|-----------|-------------|
| **Internal** | **S1**: Vertical integration — self-developed battery (FinDreams), chips (IGBT), motors, controllers, BOM cost 15-20% lower than competitors. Still maintains 17.7% gross margin in price war | **W1**: Brand premium ceiling — Yangwang/Denza/Fangchengbao still cultivating, RMB 300k+ market share <5%. Yangwang U8 monthly sales <1,000 |
| | **S2**: Product + tech full coverage — RMB 79.8k to RMB 1.098M full price range; DM-i hybrid range 2,100km, fuel consumption 2.9L/100km, clear tech generation gap | **W2**: ADAS gap — "Tiangshen Eye" lags Huawei ADS 3.0/XPeng NGP by 1-2 generations, high-end AD adoption <15% (Huawei >50%) |
| | **S3**: Manufacturing scale — monthly capacity >460k units, scale suppressing per-unit costs. 100k layoffs show efficiency optimization determination | **W3**: Overseas brand from scratch — Western recognition extremely low, "Chinese brand discount" estimated 10-15%. Dealer network and after-sales immature |
| | **S4**: Cash reserves RMB 167.8B + annual R&D >RMB 50B — can fight price war + invest in tech simultaneously | **W4**: Too many models — 20+ series/100+ variants on sale, dealer inventory management and service training under pressure |
| **External** | **O1**: Overseas NEV penetration extremely low (SE Asia <5%, Middle East <3%, LatAm <2%), 2025 overseas +145% already validates growth certainty | **T1**: Tariff encirclement — US 100%, EU 35.3%, Canada 100%, Turkey 40%, direct vehicle exports blocked |
| | **O2**: PHEV market explosion — 2024 PHEV growth 85% vs BEV 15%, BYD DM-i has generational advantage | **T2**: Industry price war — three consecutive years of price wars, ASP continuously declining, second-tier brands "table-flipping" clearance |
| | **O3**: RMB 100-200k mass market consolidation — competitors exiting (WM Motor bankrupt, Human Horizons halted, Neta struggling), share available for pickup | **T3**: Huawei ADAS ecosystem — AITO/Luxeed/Stelato with ADS 3.0 capturing intelligent driving high ground, premium users "buy ADAS not battery" |
| | **O4**: Energy storage + commercial vehicle blue ocean — battery tech transferring to energy storage (2025 market >RMB 500B) and electric heavy trucks/buses | **T4**: Battery overcapacity — industry capacity >2TWh vs demand ~1.2TWh, utilization <60% |

---

#### TOWS Cross-Strategic Analysis

**SO Strategy (Offensive): Cost + PHEV dominate mass market → "China's Toyota"**

S1 (cost) + S2 (DM-i) × O2 (PHEV explosion) + O3 (market consolidation):
- RMB 100-200k "annihilation battle": DM-i 5.0 + scale cost advantage, achieving "oil-electric price parity" in the core price band of joint-venture brands. Target 2026 domestic market share 14%→18%+
- S4 (capital) × O4: Battery tech transfer to energy storage/commercial vehicles, FinDreams Battery independent supply, energy storage business revenue estimated >RMB 20B
- Outlook: 2026 domestic 4M units (2025 domestic ~3.55M), overseas 1.5M

**WO Strategy (Turnaround): Overseas factories bypass tariffs + build brand**

Leverage O1 (overseas increment) to address W3 (weak overseas brand):
- Local factory construction — Hungary (Europe), Thailand (SE Asia), Brazil (LatAm), Turkey (Middle East/Africa), bypassing T1
- SE Asia first to build brand recognition (cultural proximity, price sensitivity), then radiate upward to Europe
- Yangwang/Fangchengbao first establish brand in Middle East high-end markets (strong local luxury car culture), feeding back to domestic premium perception

**ST Strategy (Defensive): ADAS catch-up + cost moat**

S4 (R&D capital) addresses T3 (Huawei ADAS threat):
- "Tiangshen Eye" accelerated iteration, 2026 target high-end AD adoption 15%→40%+, already poached Huawei/XPeng ADAS teams
- S1 × T2: Vertical integration cost "outlasts" competitors — maintain positive gross margin in price war, wait for second/third-tier players to exit
- FinDreams Battery external supply to other automakers,absorb T4 overcapacity

**WT Strategy (Baseline): Focus core, cut non-strategic losses**

- Trim low-volume models: Discontinue tail-end variants with monthly sales <500,release dealer resources
- Yangwang/Denza missing targets for 4 consecutive quarters →shrinks to "tech flagship" role (not chasing volume, only building brand)

---

#### Real-World Validation: What Did BYD Actually Do in 2025?

| Strategic Direction | Actual Action | Outcome |
|---------|---------|---------|
| SO (Mass market dominance) | Qin/Song continuous price cuts, DM-i 5.0 launched | ✅ Market share increased, but margin declined 19% (rising revenue, falling profit) |
| WO (Overseas factories) | Hungary/Thailand/Brazil factories progress, overseas 1.05M +145% | ✅ Overseas becoming core growth engine, revenue share 38.6% |
| ST (ADAS catch-up) | "Tiangshen Eye" released, ADAS team expanded to 4,000+ | ⏳ Catching up but gap remains, premium competitiveness constrained |
| WT (Focus core) | 100k layoffs, some model adjustments | ✅ Efficiency optimization initiated, but model matrix still too large |

**Key Conclusion**: BYD 2025 core contradiction is "scale vs. profit" — SO strategy succeeds but at the cost of profit decline. The real strategic challenge is ST (ADAS catch-up), which determines the RMB 200k+ market ceiling.

---

### Case Methodology Takeaways

Both cases reveal SWOT-TOWS usage principles:

1. **Data anchoring is the bottom line**: "Store density advantage" needs quantification as "31,048 stores / Starbucks 4.1x" to have decision value; "weak brand" needs quantification as "business scenario <5%" to judge severity
2. **Cross-analysis is the core**: SWOT without TOWS cross-analysis is an "advanced pros-and-cons list." SO/WO/ST/WT each have action directions, helping decision-makers prioritize with limited resources
3. **Real-world validation loop**: Use companies' actual actions toreverse-verifyTOWS predictions — accurate ones strengthen confidence, deviations expose cognitive blind spots
4. **Dynamic perspective**: Both enterprises show "rising revenue, falling profit" — TOWS can foreseein advance: when SO (offensive) over-consumes resources, WT (baseline) needs proactive defenses

---

## China Localization Considerations

| Dimension | China Characteristics | Case |
|-----------|----------------------|------|
| Unique S sources | Chinese companies' unique strengths often come from: supply chain cluster effects, network effects of ultra-large-scale markets, policy dividends (subsidies/whitelists) | BYD's Yangtze/Pearl River Delta supply chain clusters; Pinduoduo's 900M-user network effects |
| Hidden W dimensions | Common hidden weaknesses: incomplete compliance systems (exposed when going overseas), organizational management failing to keep pace with scale expansion, over-reliance on founder decision-making | TikTok's overseas data compliance challenges; Luckin's early governance deficiencies leading to financial fraud |
| Policy-driven O | Opportunities often created by policy: "Dual Carbon" → new energy, "Data Assets" → data services, "Silver Economy" → elderly care | "Dual Carbon" policy catalyzed CATL and other trillion-RMB-market-cap companies |
| Unique T characteristics | China-specific threats: sudden regulatory changes, geopolitics (chip sanctions/tariff barriers), platform economy antitrust | "Double Reduction" wiped out New Oriental/TAL's hundreds of billions in market cap; Huawei chip sanctions |

---

## Data Source Recommendations

| Dimension | Recommended Data Sources |
|-----------|------------------------|
| S Strengths | Internal operational data, market share reports (brokerage research/QuestMobile), patent databases (CNKI/Google Patents), brand surveys (BrandZ/C-NPS) |
| W Weaknesses | Public company annual report "Risk Factors" section, competitive benchmarking data, user negative review analysis (App Store/review platforms), exit interviews (professional networks) |
| O Opportunities | PESTEL analysis outputs, Five-Year Plans / ministry policy documents, market gap research, industry report growth forecasts |
| T Threats | Competitor dynamics (tech news outlets), policy change monitoring (government websites), technology substitution trends (Gartner), supply chain risk tracking |

---

## Common Mistakes

| Mistake | Correct Approach |
|---------|-----------------|
| Strength listed as "excellent team" | Quantify + provide  market share XX%, XX patents |
| Opportunity listed as "market is large" | Be specific: XX sub-market growing XX% annually, penetration only XX% |
| Only doing four quadrants without cross-analysis | TOWS cross-analysis is the core output — cannot be skipped |
| Listing 10+ items without ranking | Top 3-5 per quadrant, ranked by importance |
| Doing SWOT first | SWOT is a synthesis tool — must first complete PESTEL/Five Forces etc. |

---

## Integration with Other Frameworks

| Partner Framework | Relationship |
|-------------------|-------------|
| PESTEL | Primary input source for O and T |
| Five Forces | Structural input for T (suppliers/buyers/substitutes/new entrants/rivalry) |
| Value Chain | Internal analysis input for S and W |
| Playing to Win | Strategic directions from SWOT → refined into Playing to Win choice cascade |
| Competitive Positioning Map | Positioning analysis results feed into S and W |
