In this age of acronyms and internet slang, SWOT might sound like just another organization or lazy way to say “It’s What?” to a friend.
In fact, in business-speak, SWOT Analysis stands for:
A SWOT Analysis looks like this:
Many companies often skip the step of creating a SWOT Analysis (much like they might have also neglected to create a Mission Statement, Vision Statement, Value Proposition, etc.). Like those documents, a SWOT Analysis is invaluable in moving forward with a new company or with a company’s new idea.
A well-thought-out SWOT Analysis allows a company to grow — to focus on what positive brand attributes should be promoted and what negative issues should be addressed. As well, once brand opportunities are determined, whether internal or external, steps should be taken to exploit those opportunities. Of course, any threats, for example economic, regulatory or from competition, needed to be addressed.
SWOT Analysis Process:
Information is best gleaned from both staff and customer input — their perspectives may be quite different:
- Interview staff from all departments (operations, finance, marketing, sales) as the SWOT Analysis may indicate issues across the company
- Get feedback (Ask!) from customers as to their perception of your company — the good, the bad, the room for improvement
- Once feedback is collected, prioritize the points in each section — what positives and negatives come up more frequently?
- Limit the list to 3-6 points for each section initially — the idea is to focus on the most universal comments, not list everything that came up
- Keep the points simple (in terms of wording) — and actionable
- Don’t bury the bad stuff — you’ll have to face it sooner or later
How to Develop a SWOT Analysis with Action Steps:
Once you’ve finalized your SWOT Analysis, decide what actions you’ll take to either build upon the positive (Strengths/Opportunities) or counteract the negatives (Weaknesses/Threats).
A Swot Analysis with Action looks like this:
A SWOT analysis is an internal document and is not one-and-done; it should be revisited periodically, along with new research, to see if issues have been resolved, positives have been promoted, negatives mitigated and to determine if there are new points to add or resolved issues to delete.
- Here are examples of Strengths: Brand Strength/Recognition, Good Distribution System, Large Market Share, Excellent Financials
- Here are examples of Weaknesses: Out-of-Date Technology, Rising Competition, Minimal R&D, Lack of a Succession Plan
- Here are examples of Opportunities: Possible Acquisitions, Expanding Market, Decrease in Competitors
- Here are examples of Threats: Increasing Competition, Economic Downturn, Regulatory/Compliance Requirements
Whatever the age of your company, or if you’re launching a new product or service, being prepared for eventualities, good and bad, can help you avoid a troublesome situation or take advantage of one that’s positive. A SWOT Analysis, especially one that includes Action Steps, is a “roadmap” that can guide your business through those “What If?” situations.