Using the analytic network process (ANP) in a SWOT analysis – A case study for a textile firm

Abstract

Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis does not provide an analytical means to determine the importance of the identified factors or the ability to assess decision alternatives according to these factors. Although the analysis successfully pinpoints the factors, individual factors are usually described briefly and very generally. For this reason, SWOT analysis possesses deficiencies in the measurement and evaluation steps. Although the analytic hierarchy process (AHP) technique removes these deficiencies, it does not allow for measurement of the possible dependencies among the factors. The AHP method assumes that the factors presented in the hierarchical structure are independent; however, this assumption may be inappropriate in light of certain internal and external environmental effects. Therefore, it is necessary to employ a form of SWOT analysis that measures and takes into account the possible dependency among the factors. This paper demonstrates a process for quantitative SWOT analysis that can be performed even when there is dependence among strategic factors. The proposed algorithm uses the analytic network process (ANP), which allows measurement of the dependency among the strategic factors, as well as AHP, which is based on the independence between the factors. Dependency among the SWOT factors is observed to effect the strategic and sub-factor weights, as well as to change the strategy priorities.