Weaknesses and threats in an organization

SWOT analysis

SWOT analysis is a type of strategic planning by an organization. It helps in identifying the strengths, weaknesses, opportunities, and threats to the overall business of the organization, and helps the company to determine its strategic advantage against its competitors.

Weaknesses in an organization

The weakness of an organization is the internal factors that have a negative impact on the company’s performance (Alvarez et al.,2016). Also, due to weaknesses, an organization might have a disadvantage against a competitor. A manager must identify the weakness and analyze its potential damage to the company. The main objective should be to eliminate or minimize the negative impact of the said weakness. Weaknesses can undermine the capacity of an organization during an opportunity, which might lead to potential losses for the company.

Threats in an organization

Threats for an organization are the external factors that might have a negative impact on the business of an organization (Branch, 2018). Like weaknesses, threats can also cause problems for the company in the long run if not minimized. Threats should be identified and prioritized according to their potential negative impact on the company. Plans should be made to reduce the potential of the said threats to the organization. .

Due to globalization and the newly emerging IT business opportunities, competitive threats for an organization are growing at a faster rate than before. Managers play a vital role in an organization to evaluate potential threats and propose suitable countermeasures for them (Kim & Lee, 2018).

Differences between organizational threats and weaknesses

Both threats and deficiencies should be eliminated or minimized so that they have a minimum negative impact on the organization. While threats are mostly external factors, weaknesses are internal factors that hamper the competitive advantage of the organization. Threats can be easy to identify, whereas weaknesses can be difficult to identify as they are part of the organization.

Threats need to be identified and sorted according to their priority, whereas weaknesses should be analyzed against their potential negative impact. Weaknesses can already be present in an organization, but threats can be new or emerging in the market as per circumstances. An organization faces threats mostly in the form of another rival organization. Weaknesses reduce the capacity of an organization to deal with a threat.

Examples of threat and weakness of a company

Company A and their rival company B wants to launch a similar product in the market. Company A does not have sufficient funds to hire proper advertising channels to market the product. Whereas company B has the resources and the money to give a contract to a leading advertising company.

In the given example, company A has a weakness, which is a lack of funds due to which they are unable to afford an excellent advertising company. The inability to provide proper advertising for the product and the ability of company B to launch a better product is the threat, as it will ensure that the product launched by Company A gets a lesser share of the market. Thus, the product launched by company A will have lower sales as compared to the product of company B.

References:

Alvarez, S., Carballo-Penela, A., Mateo-Mantecón, I., & Rubio, A. (2016). Strengths-Weaknesses-Opportunities-Threats analysis of carbon footprint indicator and derived recommendations. Journal of cleaner Production, 121, 238-247.

Branch, L. E. (2018). Cyber Threats and Healthcare Organizations: A Public Health Preparedness Perspective.

Kim, C. Y., & Lee, K. (2018, January). Risk management to cryptocurrency exchange and investors guidelines to prevent potential threats. In 2018 International Conference on Platform Technology and Service (PlatCon) (pp. 1-6). IEEE.