- January 16, 2017
- Posted by: Finbarr McCarthy
- Category: Business Strategy
THE SWOT ANALYSIS remains an extremely useful tool for wider strategic thinking about the future of your business or if you are simply looking to refocus the minds and efforts of your management team.
It will enable you to fully identify, document and prioritise your internal strengths and weakness together with the opportunities and threats you face and can be easily achieved through a one day session with your staff.
Once completed, the SWOT provides an excellent framework for reviewing the current activities, position and future direction of your business.
To stay focused during this exercise, it is best to remind the participants at the outset what each element in the SWOT means. It is common that a lot of time can be wasted in debates over whether a Strength is an Opportunity or both etc. The following therefore should be at hand to guide that debate:
Strengths and Weaknesses
These are the internal environment – the situation inside your business for example, factors relating to people, skills, adaptability, performance, processes, technology, infrastructure etc. These factors tend to be in the present.
Opportunities and Threats
These are the external environment – the situation outside your business for example, factors relating to the marketplace, trends, competition, regulation, economic factors, political landscape etc. These factors tend to be in the future.
Once you have fully explored every aspect of your business under these categories, it is important that you follow through by using the information to help build a SWOT Matrix which has the benefit of automatically suggesting actions for issues that have been identified.
This is in effect a simple matching and prioritising process that can act as a very significant guide to the next steps that management may want to take. This matching works as follows:
Strengths / Opportunities – obvious natural priorities
Likely to be quickest and easiest to implement and probably justifying immediate action or a feasibility study.
Strengths / Threats – easy to defend and counter
Only basic awareness, planning and implementation are required to meet these challenges with investment in these issues generally being safe and necessary.
Weaknesses / Opportunities – potentially attractive options
Likely to produce good returns if you have the capability to implement and are potentially more exciting and rewarding than Strengths / Opportunities due to the benefits achieved from addressing improvements.
Weaknesses / Threats – potentially high risk
Assessment of the risk here is crucial and where that risk is high, you must assess capability gaps and plan to defend/avert in very specific and controlled ways.
While this is a short guide, going through the above basic SWOT analysis for your business is proven to deliver the following benefits:
- Through your own assessment, it will tell you what is currently good and bad about your business;
- The analysis will produce issues which very readily translate into clear strategic actions;
- The strengths of your business can be maintained, built on and leveraged;
- Opportunities can and should be prioritised and optimised to greater effect;
- The weaknesses in your business can be remedied or actions taken to eliminate where not;
- Threats you are facing can be countered through mitigating or eliminating tactics;
- Your management will get valuable time away from their daily routine to think about and discuss the future;
FITZGERALD Consulting has a proven methodology for developing highly effective strategic plans that deliver fantastic outcomes for our clients.