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CS Professional · Strategic Management and Corporate Finance · Analyzing the External and Internal Environment

In a SWOT analysis of a Chennai-based auto-components maker, the analyst lists: (i) a proprietary casting technology, (ii) a new government incentive scheme for component exports, (iii) rising steel prices, and (iv) a highly skilled workforce. Which of these are correctly classified as internal factors?

Only the proprietary casting technology and the skilled workforce are internal factors, being strengths arising from the firm's own resources. The government export incentive is an external opportunity and rising steel prices are an external threat, so they are not internal.

  1. A(i) and (iv) onlyCorrect
  2. B(ii) and (iii) only
  3. C(i) and (ii) only
  4. D(iii) and (iv) only

Explanation

Strengths and weaknesses are internal to the firm: proprietary technology and a skilled workforce are internal resources. The export incentive is an external opportunity and rising steel prices are an external threat. So only (i) and (iv) are internal.

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