Final answer:
SWOT analysis evaluates the external environment by identifying potential Opportunities and Threats. It helps in strategic decision-making but has limits such as subjectivity and the need for constant updates. Environmental factors greatly influence sectors such as agriculture and tourism.
Step-by-step explanation:
SWOT analysis assesses the external environment for two main factors: Opportunities and Threats. Opportunities are external chances that an organization can capitalize on to grow or improve its competitive advantage. Threats, on the other hand, are external challenges that may hinder an organization's performance and require strategies to mitigate.
Strengths of the SWOT approach include providing a structured analysis that helps organizations identify factors affecting their performance, thus aiding in strategic planning. Some limits to this approach include the potential for subjective assessments that may not accurately reflect real-world complexities and the requirement for regular updates as external environments are constantly changing.
Environmental protection as an external factor significantly impacts industries such as agriculture and tourism, especially in low-income countries. Labeling products to align with environmentalist values and international treaties or agreements about environmental sustainability are examples where SWOT's external analysis could identify opportunities for growth or threats from non-compliance.