If your company has been in business for some time and you are not seeing the growth and improvement you would like, we recommend conducting a SWOT analysis of your company as a whole. This is a great exercise for evaluation because it will reveal both the good and the bad and will give you actionable steps to take for greater success.
What Is a SWOT Analysis?
A SWOT analysis is an organized evaluation of your company’s:
- Strengths
- Weaknesses
- Opportunities
- Threats
The primary reason for conducting this kind of analysis is to help your company leadership become aware of all of the factors involved in your decision making process so that you can make more effective decisions moving forward. This will help you better achieve your short-term and long-term goals.
How Do You Conduct a SWOT Analysis?
First, start small. While you could try to assess every strength and weakness your company has, it would be overwhelming and unhelpful. Begin your SWOT analysis by having a specific question or a goal in mind. Perhaps you are considering developing a new product or offering a new service. Focus on that possibility as you begin your assessment. From there, you need to do some research to determine what is happening in your business, your industry and the markets you are targeting. Learn more about your competitors, talk to your staff, and do some market research.
From there you can begin to look inward. The first letter in SWOT stands for Strengths, and that’s a great place to start because listing the positive is always rewarding. Make a list of the things that your company really does well and the assets that it has. This could include intellectual property, a strong customer base, an established brand, or a great location. Brainstorming is great during these first steps, but keep your list contained to the question you are trying to answer or your specific goal.
Sample questions you might ask are:
- What do you do well?
- What do others view as your strengths?
- Do you have unique abilities or resources you can use?
The next step is to list your business’s weaknesses relative to that same question or goal, and you should evaluate your company within its industry and market. You may be very effective at some service, yet another business consistently outperforms you. Examples of weaknesses might be staff turnover, poor marketing, a limited number of product offerings, or lack of access to enough credit or investors.
Some questions to consider would be:
- What could you improve?
- What would other people say are your weaknesses?
- How do your resources stack up against your competitors’?
After you have determined what your weaknesses are, you need to address them. This is a part of the continuous improvement process that a SWOT analysis facilitates. A SWOT analysis is not a one-and-done phenomenon for companies that are motivated to achieve success. It’s useful to do a SWOT analysis whenever you are considering a new course of action, plan to launch a new product, or even when you create or revise company policies.
Typically, a SWOT analysis will be done using a table format that is split into four parts so that strengths, weaknesses, opportunities, and threats can be listed side by side. These different sections don’t have to “match” each other, but companies often find that their strengths and weaknesses are correlated. It can also be eye opening to stack these up next to each other. In the presence of many strengths, the weaknesses may not seem so unsurmountable.
The other two sections of this graph are for opportunities and threats. In the opportunities section you can brainstorm things that your company could do that would make it stronger and more profitable. This might be implementing new technology or investing in further training for your staff. It could be taking advantage of changing government regulations that could affect your business model positively.
Finally, under the threats section, list potential or current threats to your business. This might include a bad economy, difficulty acquiring workers with certain skills, or inflation. Threats are different from weaknesses in that they are external to your company, not internal.
When you have all four sections completed, you will be able to better answer the question you began with because you will be able to view your company and its capabilities much more objectively. Now you can ask more targeted questions like:
- How can we use our strengths to take advantage of the opportunities we’ve listed?
- How can we address our weaknesses to nullify the threats the business is facing?
Answering these more specific questions will give you concrete, actionable steps to take to strengthen your business so that it’s in a better position to succeed.
Why Your Company Should Conduct a SWOT Analysis
You may think you don’t need to do a formal SWOT analysis. It’s enough to give the strengths and weaknesses of your company some thought and go from there. But taking the time to do research on your market and industry, to brainstorm with other people within your company, and to concretely define your strengths and weaknesses, opportunities and threats will give you a much more comprehensive overview of your company. It’s also the perfect springboard for improving the business as a whole and strategizing your next moves in your market.
If you have questions about SWOT analysis or want help with any other business problem, Prometis Partners is always here to help. Call us today to talk about the business issue on your mind.
