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How to Conduct a SWOT Analysis
Another day, another business acronym looking for your attention. There are no shortcuts to turbo boosting your business, but a well-executed SWOT analysis is an ideal way to help you uncover where to focus your precious time and energy next. The perfect SWOT analysis follows a straightforward matrix. With a little self-discipline and a healthy dose of honesty, noting your business’s Strengths, Weaknesses, Opportunities, and Threats can lead you to some invaluable insights. Here’s our guide to executing your own SWOT analysis in four easy steps.
Before you throw yourself into a week of SWOT-ing you might want to get to grips with the concept by applying it to something smaller. The great thing about a SWOT analysis is that it can be applied to everything from your entire business right down to whether or not a new vendor is the right one. Try implementing a SWOT analysis on a decision that you’ve been having trouble with. You’ll end up with some great insights about the decision and you’ll get a fuller understanding of how the analysis works.
The implementation of a SWOT analysis needs a little figuring out before you can unlock its maximum potential. Many people start by simply drawing a square with four chambers and labeling the upper left-hand chamber “Strengths”, the lower “Opportunities” and the upper right-hand chamber “Weaknesses” and the lower “Threats”. Or, if you need a more literal approach, try this; think of the left-hand chambers as the positives, the right-hand as the negatives and the upper chambers as those that apply to internal matters and the lower to external.
Fill in the Blanks
With your matrix ready to be filled in, you now need to start asking the questions that will fill it. It helps to start with the broadest questions and working from there. To help kick things off, here are a few examples of some SWOT analysis questions that are often used by businesses.
The positive factors impact your business that are within your control:
- What do we do well?
- What do we do better than our competitors?
- What resources do we have at our disposal?
The negative factors that impact your business that are within your control:
- What don’t we do well?
- What do our competitors do better than us?
- What resources are we missing?
The positive factors that impact your business that are outside of your control:
- Is our product/service becoming more in demand?
- Can we reach a larger audience?
- Can we decrease costs somewhere?
The negative factors that impact your business that are outside of your control:
- Who are our competitors?
- Are some services/products increasing in price?
- Are our manufacturers/providers unreliable?
Refine and React
It’s likely that part 3 of the analysis led to a huge amount of lists, ideas, questions and, hopefully, insights. You now want to narrow these down to the most important, actionable, and time-sensitive ideas to allow you create a strategy. Ideally, you’ll go from reams of creative brainstorming to one neat page of SWOT analysis that you can turn into strategy.
A simple example would be that you discovered your business is famous for its customer service (strength), but as it grows the person/team who looks after this important aspect is stretched too thin (weakness). Your competitors have outsourced their customer service (threat), but you’re not comfortable moving such an integral part of your business from in-house and risking a loss of quality (opportunity). From there, you might decide that the person/team that has brought the customer service to such an elevated level should oversee a new member hire or train a current team member.
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