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Key Business Analysis Tools Explained

The document discusses several business analysis models that are useful for understanding an organization's environment and thinking strategically. It focuses on describing SWOT analysis and PESTLE analysis in more detail. SWOT analysis involves examining internal strengths and weaknesses as well as external opportunities and threats. PESTLE analysis assesses the political, economic, social, technological, legal and environmental factors impacting a business. Both tools provide benefits such as helping to develop strategies and identify risks. Other analysis techniques mentioned include scenario planning and Porter's Five Forces framework.

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Welkin Jay Seniel Balingit
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16 views11 pages

Key Business Analysis Tools Explained

The document discusses several business analysis models that are useful for understanding an organization's environment and thinking strategically. It focuses on describing SWOT analysis and PESTLE analysis in more detail. SWOT analysis involves examining internal strengths and weaknesses as well as external opportunities and threats. PESTLE analysis assesses the political, economic, social, technological, legal and environmental factors impacting a business. Both tools provide benefits such as helping to develop strategies and identify risks. Other analysis techniques mentioned include scenario planning and Porter's Five Forces framework.

Uploaded by

Welkin Jay Seniel Balingit
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Business Analysis Models

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Business Analysis Models
useful tools and techniques that can help you
understand your organisational environment and
think more strategically about your business. Dozens
of generic techniques are available, but some come to
the forefront more frequently than others do. These
include:
– SWOT (strengths, weaknesses, opportunities,
threats) analysis
– PESTLE (political, economic, social,
technological, legal and environmental) analysis
– scenario planning
– Porter's Five Forces framework
SWOT Analysis
one of the most popular strategic analysis models.
It involves looking at the strengths and weaknesses of
your business' capabilities, and any opportunities and
threats to your business.
– Once you identify these, you can assess how to:
– capitalise on your strengths
– minimise the effects of your weaknesses
– make the most of any opportunities
– reduce the impact of any threats
SWOT Analysis
gives you a better insight into your internal and
external business environment. However, it does not
always prioritise the results, which can lead to an
improper strategic action.
One way to make better use of the SWOT
framework is to consider the customer's perspective
when making strategic plans and decisions. You can do
this by applying importance-performance analysis (IPA)
to identify SWOT based on customer satisfaction
surveys.
Advantages of SWOT Analysis
A SWOT analysis offers many benefits, including helping you
to:
• understand the key issues affecting your business
• spot and deal with weaknesses
• minimise risks and deter threats
• capitalise on opportunities
• take advantage of your strengths
• develop business goals
• identify strategies for achieving your goals
A SWOT analysis is typically also low- or no cost, and
relatively quick and simple to carry out.
PESTLE Analysis
PESTLE analysis is a fundamental tool for business strategy and
planning. It is a method of assessing your business' environment and its
possible impact on the performance of your company.
PESTLE is an acronym which stands for six external
factors affecting your business: political, economic, sociological,
technological, legal and environmental. Each of these factors can have a
profound effect on your business and varying implications, for example,
in terms of:
– duration of impact - short term or long term
– type of change - positive, negative or unknown
– rate of impact - increasing, decreasing, unchanged or unknown
– importance - critical, important, unimportant or unknown
Advantages of PESTLE Analysis
By helping you to understand how external factors affect your
businesses, PESTLE can help you:
– determine their long-term effect on the performance and
activities of your business
– review any strategies you have in place
– work out a new direction, product or plan for your business
– identify solutions to problems
– gain strategic advantage on competitors
– evaluate the risks associated with markets you're interested in
PESTLE is an extended version of PEST analysis. It is often used
in collaboration with other analytical business tools like the SWOT
analysis and Porter's Five Forces to give a clear understanding of a
situation and related internal and external factors.
Other Strategic Analysis Tools
Scenario planning - a technique that builds various
plausible views of possible futures for a business.
Critical success factor analysis - a technique to identify
the areas in which a business must succeed in order to
achieve its objectives.
The Five Forces - a framework for looking at the strength
of five important factors that affect competition -
potential entrants, existing competitors, buyers,
suppliers and alternative products/services. Using this
model, you can build a strategy to keep ahead of these
influences.

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