Small or large businesses (and every business size in between) can benefit from conducting a SWOT analysis. Even start ups! The term has been tossed around for a while with few truly benefiting from its capabilities, especially when the process is haphazardly handled.
What’s in a SWOT?
S.W.O.T. stands for the Strengths, Weaknesses of a business (internal) and Opportunities and Threats which affects it (external). Marketers especially use this analysis as a strategic tool to develop a snapshot of the operating conditions of a firm which can help predict future trends, highlight cash cows or even pinpoint a red flag on any aspect of concern – all part of the overall marketing plan, and business plan by extension. It is always good to know where you have been and where you are now and what’s waiting for you around the corner.
How can a SWOT analysis help?
As an analytical tool, it aids in highlighting all the factors which can either advance or hinder success and progress. However, content must be based on facts no matter how difficult it may seem. In some cases however, information may not be easily accessible but using sources which are as accurate as possible, will go a long way into producing a true SWOT and gain helpful insights.
How do you get started?
Different methods are used to gain the content for analysis however, most use a quadrant and list components until the process is exhausted. It is essential to be honest. Brainstorming in collective can move the process along and extract concepts which one person wouldn’t highlight on his own. Always remember the purpose of your SWOT when compiling the data – strategic advantage.
What should each section look like?
Strengths should focus on the following aspects taking a hard look at yourself and business as a whole:
Expertise or special skills
Product knowledge
Competitive edge
Experience
Unique selling points
Best sellers/most profitable
Weaknesses can be hard to put on paper but integral in identifying and correcting deficiencies which hinder success from within. Look closer at:
Resource shortage
Educational gaps
Lack of expertise
Slow movers
Financial drainers
Product innovation
Opportunities are the exciting attributes which gives hope to every business by monitoring the external environment conditions to achieve your main objectives. Consider these areas when compiling data:
New client base
Consumer need gaps
Niche markets
Market need gaps
Technological advancements/ product enhancements
Product/service range expansion
Threats are simple – they can cripple a budding business. Areas to note are:
Competitive strengths
Product life cycle
Upcoming trends
Economic stability
New industry policies
Technological advancements
New entrant obstacles
Political factors
Obstacles
Got the facts, now what?
The analysis can be quite tasking. Some factors are clearly defined while others need further research. From the data, new and more efficient strategic plans can be devised, aligned with the goals for the business. Creating an Action Plan will help build on the strengths and work on resolving weaknesses. Capitalize on the strengths to squash the threats identified and start setting SMART goals to benefit from each opportunity identified. The process is long and can be taxing but with continuous work, any business no matter the size, can achieve success.
Farm out this task to your marketing or operations department or likewise, to a marketing firm for an unbiased view. A professional marketing company can help you explore how to combine your strengths and opportunities to design new strategies, while eliminating threats using the hidden strengths. Additionally, weaknesses and opportunities can be lined up to identify areas which can be immediately improved. The process is arduous but when undertaken correctly, will improve the decision making process and devise amazing strategic goals for any business with a penchant for success.