Topic > Internal and Internal Analysis: Opportunities and Threats

Opportunities and Threats The second and third components of the strategic planning process include performing an internal and external analysis to determine the organization's strengths and weaknesses , as well as related opportunities and threats; these connect to the next section of strategic planning and are commonly referred to as a SWOT analysis. As illustrated by Hill, Jones, and Schilling (2014), to assist organizations in choosing future strategies, they can perform a SWOT analysis to determine their strengths; weaknesses, opportunities and threats (p. 17). Hill, Jones, and Schilling (2014) do not state that, to determine future strategies, it is important for an organization to perform this analysis to "build and protect the company's strengths and root out" internal analysis, the third component of the strategic planning process, focuses on reviewing a company's resources, capabilities and competencies” (Hill, et al., 2014, p. 17). Internal analysis is a three-step process that identifies the organization's strengths and weaknesses. As pointed out by Hill, Jones, and Schilling (2014), managers must first understand the process of creating value and profit, as well as the role of distinct resources, capabilities, and competencies (p. 82). Secondly, they must understand how to create value and profitability. As Hill, Jones, and Schilling (2014) noted, “they must understand the importance of superior efficiency, innovation, quality, and customer responsiveness when creating value and generating high profitability” (p. 82). Finally, an internal analysis must show the sources that determine the achievement of competitive advantage and profitability and how to improve "Online shopping and purchasing is made easy with an intuitive interface, product recommendations, customer wish lists and a one-click purchasing system option for repeat customers” (Hill et al., 2014, p. 116) In addition to increasing the efficiency of its online experience, Amazon is now working to use robots in its distribution centers with l Kiva's purchase. “Kiva has announced that for the next 2 to 3 years it will not accept external orders and will instead focus on automating Amazon's distribution centers” (Hill et al., 2014, p. 117). employees who walk miles and miles and pick products off the shelves, Kiva will do that for