Science & Research

APPLICATION OF THE SWOT-ANALYSIS IN PROJECT MANAGEMENT IN

BUSINESS ORGANIZATIONS
Borislava Galabova1
University of Mining and Geology “St. Ivan Rilski”,
Sofia, Bulgaria, 1700, Studentski grad, “Prof. B. Kamenov” street

Abstract
In today's environment most business organizations realize a substantial part of its activities on
the principle of projects. Project is a complex undertaking with a specific goal. The realization of this
goal in a planned period and quality of the final product means that it’s successfully completed.
Innovation and changes in business organizations are typically performed through the implementation
of projects. In the rapidly changing economic environment the realization of projects, as a working tool
for strategic change, is reasonably necessary. For that reason, the report summarizes the opportunities
for application of one of the classic methods for strategic planning – the SWOT-analysis, in the project
management process. Some benefits from its use are derived, based on a critical review and analysis.
Good practices, applicable to business projects, are resumed.
Keywords: SWOT-analysis, project management, business organization, project, strategic management

Introduction
In today's environment most business organizations realize a substantial part of its
activities on the principle of projects. Moreover, innovation, structural and organizational
change are possible through the implementation of such initiatives. Changes are a logical
consequence of the impact of internal and external factors. They determine the dynamics of the
environment to which the business has to adapt in a timely manner. Therefore, the
implementation of projects often acknowledged as a leading tool for strategic and change
management. Response to the economic changes has to be reflected in the development of
specific business strategy. In order to fulfill its strategic objectives, the business organizations
develop and implement projects. They are based on the organizational strategy and the main
areas for growth and development. The successful implementation of projects should help to
realize the strategy step by step.

Methods
The aim of the study is to present the application and scope of SWOT-analysis in project
management process in business organizations. Its structure is based on view of the project as
a management object, the management as a process, the nature and the application of SWOT-
analysis as a tool for strategic planning in project management sphere and its priorities. The
study is based on general scientific methods and widely recognized research tools. The used
methods are analysis, synthesis, abstraction, summary, induction, deduction, observation and
comparison. Through them some benefits of using SWOT-analysis in business organization
that develop and implement projects are justified.

1
Corresponding author: Borislava Galabova, University of Mining and Geology “St. Ivan Rilski”, Sofia,
Bulgaria, 1700, Studentski grad, “Prof. B. Kamenov” street, email: b.galabova_mgu@[Link]
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Results and discussions

Project as an object of management
There are different definitions for project. For example, the project:
 includes activities that have to be met in due time, costs and quality [7].
 is planning, organizing, monitoring, control and reporting of all project aspects and
motivating all people involved in it to achieve the project objectives [5].
 is a temporary endeavor undertaken to develop (create) a unique product or service [8].
 is a temporary organization created by members of this organization in order to fulfill
its mission [2].
 is a temporary organization created for the supply of one or more business products
according to approved business plan [10].
Based on the cited definitions it’s clear that the project initiative is limited in resource,
time and quality. The project is complicated and complex activity with a purpose. The
realization of this goal in a planned duration and quality of the final product means that it’s
successfully completed. The project is process-oriented. Its lifecycle goes through six phases -
initiation, planning, organizing, implementing, monitoring and control and closure. Unity of
many aspects - economic, technical, technological, legal, environmental and social, it involves
a multidisciplinary approach and strategic management. This means setting up a specific
organization and build a system of interrelated elements. At the entrance of this system are the
resources which are required for project implementation. The final product which is the
expected result is at the exit. This result varies according to the task and specification. It could
be an entirely new or improved product, service, model, organization of activity, structure,
process, etc. Regardless of the nature of the intended result, it should contribute to the
development of the business organization in the desired direction, having direct and/or indirect
benefits. The expected benefits, both economic and non-economic, are the main criterion for
the project's consistency. Therefore, the project is a tool for organizing activities that can’t be
completed as routine operations [8] and through which it’s planned to meet the defined goal
within the set limits - time, cost, quality.
Project management - theoretical and applied aspects
Project management is a process of controlled impact on the object of management (the
project), which involves interaction between its constituent elements. This process, according
to the principles of the Methodology of the Project Management Institute (PMI), is defined as
"the application of knowledge, skills, tools and techniques to project activities to meet project
requirements"[9].
The project process is based on five basics processes [9]:
 Initiating
 Planning
 Executing
 Monitoring and Controlling
 Closing.
On this basis, the knowledge, applicable during the process of project management is
concentrated in ten major areas [9]:
 Integration

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 Scope
 Time
 Costs
 Quality
 Human Resources / Supplies
 Communications
 Risk Management
 Procurement Management
 Stakeholders Management.
All these ten areas have proven their influence on the outcome of the process of project
management. The reason for its importance is the nature of the project process and its
management which differs from routine activities in the business organization. They have
different characteristics, requiring specific management approach.
The framework of the project management process is defined by four key parameters:
 Scope
 Time
 Quality
 Costs.
In this sense, the good results are a coordinated function of these parameters. Project
management is a methodical approach that includes established principles, procedures and
policies. Their application influences on the project from the moment of its conceptualization
to the actual implementation.
According to the methodology PRINCE2 (Project IN controlled environment) project
management is determined by planning, delegation, monitoring and control of all aspects of
the project and the motivation of those involved in it to achieve the project objectives within
the expected performance targets for time, cost, quality, scope, benefits and risks [10]. This
methodology is based on seven basic principles that form the structured governance model.
They build the methodological framework of the project management process [6].
 First principle "Continued business justification" states that the project should have a
business sense, based on return on investment and effective use of time and resources.
 Second principle “Learn from experience” states that the project team should learn from
the experience gained in previous projects.
 Third principle "Definе roles and responsibilities" states that each team member should
know what he/she does and what the others should do, including who makes the decisions.
 The fourth principle "Manage by stages" states that the difficult tasks are carried out
more easily if they are divided into parts.
 The fifth principle "Management by exception" states that if the project is progressing
well, it doesn’t require intervention by the manager who is informed only if there is a problem
or this could occur.
 The sixth principle "Focus on products" states that everyone should know in advance
what is expected of the product, because the product requirements predetermine the operating
activities.
 Seventh principle "Tailor to the environment" states that projects in which the
methodology is adapted to the specific project needs, have a greater chance of success than
those who don’t do it.
These principles refer to the project’s economic and technical justification. The process
includes adequate allocation of resources, strategic planning, adaptation to the external
environment, internal coordination, subordination and structure.

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Finally, the results should be classified and analyzed in order to achieve the primary
objective. The analysis can be built on the following indicative time axis:
 Where was the business organization in the past?
 Where is the business organization today?
 Where should be the business organization in the future?
In the project management context, its content is framed by the identification and
study of four key elements:
 strengths of the business organization connected with the project implementation;
 weaknesses of the business organization connected with the project implementation;
 opportunities for the development of the organization related directly and / or
indirectly with the project or the overall organizational strategy;
 threats to the development of the organization, related directly and / or indirectly to the
project or the organization itself.
Most often the analysis is presented in form of a matrix. So in the economic literature it
occurs under the name SWOT-matrix.
In quadrant "Strengths" (S) are included: activities which the business organization
performs well; activities that the business organization is competitive and efficient; available
assets; resource security, including security of personnel; capacity and resources to implement
the project; skills, knowledge and competencies of the team; project experience; experience in
performing routine business operations; network of contacts and communication channels;
competitive advantages. The appropriate section could be written if a project team try to
determine what are the strengths of the business organization, focusing on a specific project or
project proposal. They originate from the organizational characteristics and add value or
provide competitive advantages. For this reason it’s important to know and carefully examine
them. The aim is to clarify all the positives that can be used in the realization of the potential
project and to study the capacity of the organization and its resources available to the project.
In quadrant "Weaknesses" (W) are included: activities which the business organization
doesn’t perform well or has no capacity to perform at all; gaps and lack of resources;
unsuccessful past projects; competitive advantages of other organizations. The purpose of this
systematization is to clarify any possible weaknesses that have or may be relevant to the project.
In this sense, the SWOT-analysis team should seek what is missing to undertake the project and
execute it successfully, what are the risk and possibilities to fail. Giving aware of these gaps
and deficiencies is the first step for their catching up. Part of the analysis of weaknesses can be
made based on a comparison with competitive business organization and their advantages. In
practical terms all weaknesses are some kind of business development opportunities. If the
project offer is well considered and formulated, the identified weaknesses could turn into
strengths for the organization in future plan.
In quadrant “Opportunities” (O) are included the chances for identification of the
strengths and for overcoming the weaknesses. Potential question that can be used for this
purpose is what are the opportunities for future development. This approach is based on the
view that behind every problematic situation in the business stands untapped opportunity. Many
organizational weaknesses can be transform into strengths through the implementation of
projects and programs, consistent with the overall organizational strategy. The opportunities
are results of complex influence of some internal and external factors. The combination of the
effects of these two groups of factors determines the existing project potential. In brief, this
quadrant is devoted to conditions analysis but also to the barriers that are the basis for future
business development. The environmental dynamics and changes in the influence of external
factors suggests dynamics in the influence of internal factors. Therefore the need for changes
is an indispensable condition for the development of a modern business organization. The
previous experience shows that if it does not change in the current highly competitive
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environment, the economic challenges can not be overcomed. This is a reason to claim that
there are various opportunities for development in the context of the overall organizational
strategy that could be utilized through the implementation of various projects.
In quadrant "Threats" (T) are included the unfavorable influences of factors of the
external environment and problems arising from the external environment behavior of
competitors. Possible question which is used is what are the threats to the organization. Certain
direct and indirect risks should be base for future projects with which to overcome and, if
possible, to turn the weaknesses into strengths. In order to do this it’s obligatory to study the
tendencies and perspectives for development in conjunction with the influence of different
factors.
SWOT-analysis examines the business organization and its project from the point of
view of the external and internal environment. The strengths and weaknesses are connected
with the internal environment, the opportunities and threats are connected with the external. So
it can be compared to the influence of internal and external factors on the business organization.
PEST analysis may apply for the purpose of the study of the impact of the external factors.
Through its application the political, economic, social and technical environment could be
determined because it will concern the project development and management. For example, the
economic factors that influence the organizational activities and operations should be seen as
both constraints and opportunities. The four parts of the final analysis are analyzed separately
and as a whole, because they are interlinked.
Benefits of SWOT-analysis in project management in business organizations
The latest data shows that 30% of started business projects are interrupted in the middle,
50% of all started projects spends twice bigger budget than expected and twice as much time
[3]. These data indicate the need to pay more attention to the strategic planning process, using
adequate analyzing tools. Within the project management process SWOT-analysis is applicable
to many purposes, which are a subject of further analysis. In short it’s a technique for strategic
management of the project and for build organizational strategy associated with its
implementation. SWOT-analysis found a place in selection of proposals in business
organizations with various activities. This selection is based on the study of strengths,
weaknesses, opportunities and threats for the organization for each particular project case. It
can be used as a tool for evaluation of the most promising proposal. After making a choice and
a project proposal is approved in an organizational level, the project team can start the project
officially.
SWOT-analysis is an analytical tool, which is relatively easy for application. Moreover,
it’s acknowledged as an evaluation tool with great potential because it can be used both for a
specific project or for an entire organization and business. It’s suitable for decision-making on
different issues, allowing implementation of a strategic approach, without spending special
resources. SWOT-analysis is a base for starting a project by which to avoid some threats, take
new opportunities, develop strengths and overcome weaknesses in business organizations. It
can also be used as a tool to analyze the critical success factors (CSF) in project management.
This is its advantage because it helps their identification and generalization, allowing effective
management process.
The objectivity requires to mention that many scientists and economists criticize the
SWOT-analysis and its capacity as a management tool [11, 12]. One of the main critics is for
its possibility to identify organizational problems without giving solution to them. However,

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any SWOT-analysis ends with summaries, which could be used for searching for solutions and
for preparation of a plan and a project road map. Another criticism is for the difficulties in data
collection and compilation. The interpretation of this information may be wrong, incomplete or
one-sided and the result could be a distortion of the analysis and summaries. Some analysts
point out that behind the SWOT-analysis there is robust theoretical basis. Although
longstanding business practice confirms that it could help to develop a strategy and a plan for
project’s execution and it’s applicable in real business terms. One of the legitimate criticisms
of the SWOT-analysis is that it doesn’t allow comparison with competing organizations.
However, such an element may be included in the analysis in determining the strengths and
weaknesses. Another criticism is justified by the lack of a specific quantitative measure in
carrying out the analysis. However, quantitative values, however, may be included in each
quadrant, so it becomes reliable framework for subsequent specification in quantitative terms.
Conclusion
In recent decades, SWOT-analysis is emerging as a powerful tool for sizing a resource
capacity, organizational weaknesses, market opportunities and external threats [11]. It shall
apply for situational analysis, through which it can adapt its internal structure, activities and
processes to the economic environment in the selection and project management process. The
studied tool is not definitive, but rather flexible and adaptive to different requirements. Its
advantages make it particularly valuable and useful in the selection process and in project
management process in every business organization.
References
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economy, 2011, Sofia, p. 58 (in Bulgarian). [Златев, В., Р. Радев. Въведение в управлението
на проекти, Университет за национално и световно стопанство, София, 2011, с. 58]
[2] Andersen, E.S. Rethinking PM – An Organizational Perspective, Prentice – Hall, Harlow,
2008.
[3] Arabzad, S.M., Ghorbani, M., Shirouyehzad, H. Adopting SWOT Analysis to Strategic
Project Management in Municipality. In: 2nd International Conference on Strategic Project
Management, Teheran, Iran, May 2011.
[4] Humphrey, A. SWOT-analysis for Management Consulting, SRI Alumni Newsletter. SRI
International, 2005
[5] International Organization for Standardization. Standard ISO 10006, 2003, pp.20
[6] Managing Successful Projects with PRINCE2, 2017 Edition, Axelos, 2017.
[7] MR. Atta’ii, H. Mirzapour. “Applying strategic management in project selection;
application of numerical models”. In: The first international conference on strategic
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[8] Project Management Institute. A Guide to the Project Management Body of Knowledge
(PMBOK Guide), 3th edition, Project Management Institute, Newton Square, PA, 2004.
[9] Project Management Institute. A Guide to the Project Management Body of Knowledge
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[10] Turley, F. A simple PRINCE2 Glossary, Version 02.00, Axelos Certified Partner
[11] Thompson, A.A., Strickland, A.J., J.E. Gamble. Crafting and Executing Strategy –
Concepts and Cases, 15th Edition, USA: McGraw – Hill Education/Irwin, 2007.
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In: Journal of Applied Business Research 21(2), 2005.

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