Final answer:
The SWOT analysis is a strategic planning tool used to evaluate a company's internal Strengths, Weaknesses, and external Opportunities and threats. It helps businesses assess internal capabilities and external environmental factors.
Step-by-step explanation:
The SWOT analysis is a tool used in the planning process that helps companies evaluate changes in external environments and assess strengths and weaknesses within the firm. The acronym SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. This tool allows businesses to identify the areas where they excel (strengths), areas where they may have challenges (weaknesses), opportunities that can be exploited for advantage, and external threats that could impact the business negatively. PESTLE (Political, Economic, Social, Technological, Legal, and Environmental), GAP, and STEEP (Social, Technological, Economic, Environmental, and Political) are other tools that focus on different aspects of business analysis, but the SWOT analysis is particularly centered on internal evaluation in conjunction with external factors.