At first, conducting a business SWOT analysis can sound daunting. Although not known to most small business owners, this is a formidable tool that can be conducted in a few hours or a half a day.
In truth, your business SWOT analysis allows you the ability to brainstorm ideas that can lead to exact planning and effective tactical actions for progress with your business.
As the poet Oliver Wendell Holmes once said, “A moment’s insight is sometimes worth a life’s experience.”
A business SWOT analysis can give you that great insight when conducted correctly and thoroughly.
Differentiating Internal From External
The first two points, Strengths & Weaknesses, deal with internal factors that you can control. Opportunities & Threats are the external factors that will need to be mitigated and dealt with successfully. Moreover, each of these 4 pillars of business analysis allows one to plan comprehensively, establishing what is needed to form a robust marketing strategy.
Marketing is about creating desire in potential and existing clients, regardless of any barriers, real or imagined. A well-performed SWOT analysis will clarify and differentiate all crucial factors, internally and externally, so that one proactively develops a well-crafted platform to build success upon.
An Overview of the Business SWOT Analysis
When conducting your business SWOT analysis, I suggest that you keep it simple. Particularly if this is the first time that you have ever conducted one. I also strongly advise that if possible, conduct this SWOT analysis with someone who is highly trained in business processes and marketing. And the reasoning is simple: We tend to lack humility and thus focus only on our Strengths and Opportunities, and tend to not give enough attention to our Weaknesses and Threats.
I am all for maintaining a positive attitude. But, your business SWOT analysis is not being conducting to make you feel good. It should represent a honest and thorough assessment of your business. My suggestion is to list no more than four to five points within each of the four pillars. So, be sure to prioritize what are the most important elements in each to address. Otherwise, you can nitpick yourself into frustration, which is not the purpose of this analysis.
Strength – This is defined as our capabilities, resources (money, our brand, staff, loyal clientele, etc.) and processes.These are the internal factors that represent definite value and tend to be what makes us more competitive in the market place. For one’s strengths be fully defined and known, market research and surveys are crucial to determine where and how one dominates in the market place.
Weakness – This represents the flaws and limitations of our capabilities, our lack of required resources, points of disorganization or a lack of ideal business processes. And again, statistical analysis and surveys, of clientele and employees alike, are crucial to fully determining where the weak points lies and why.
Opportunity – This is where growth is most possible. This data will primarily come from your surveys, industry reports & research, market & social trends and statistical analysis.
Threat – These are the external factors that can represent your greatest danger to viability and growth. This would include government and industry restrictions and laws, competitors, economic climate, past branding challenges, PR flaps, natural disasters and even political upheaval.
Taking Action From A Business SWOT Analysis
Planning can only be successful when based on true and complete data. The value of these points, once you have clearly identified the most important factors in each of the 4 pillars, is to now compare them.
Analysis (n.) – A method of studying the nature of something or of determining its essential features and their relations. (from Greek, from analyein to break up, from ana- + lyein to loosen)
The purpose of this analysis is to look at each pillar and how they now compare to each other. We can only evaluate the inherit importance of this information when compared to each other. Here are some examples:
- What strengths can you use to capitalize on your opportunities?
- What strengths can you use to better handle your threats?
- What weaknesses must be mitigated to capitalize on your opportunities?
- What weaknesses can be used by your external threats?
By answering these type of questions, through comparing the data gathered from your business SWOT analysis, the lights will begin to turn on and your planning can now begin to take shape. This planning must not just become a good meeting with lots of bright ideas shared. Complete planning represents writing down – in detail – all the actions that must take place. This includes the bright ideas of how to utilize your strengths, shoring up your weaknesses, how to take advantage of opportunities and how to best deal with any threats.
Converting Planning Into Tactical
“Happy people plan actions, they don’t plan results” – Dennis Wholey
It is crucial that your planning now be converted into tactical planning, with assigned actions to yourself and any team members. These need to be clearly communicated in writing with an expected date for its completion. Without accountability and time tables established, plans become failed dreams.
If conducting your business SWOT analysis, as well as the subsequent planning and tactical actions, seem overwhelming or daunting, please feel free to contact me for professional assistance.