There are hundreds of tools available to business leaders. It can be overwhelming to determine which ones to apply in a specific situation. When assessing your business and charting a strategic course for the future, one of the tools that I find to be most helpful is the SWOT analysis. The SWOT is an acronym for Strength, Weakness, Opportunity, and Threat.
Strength:
What are the things that your organization is successful at? Is it your culture? Delivery system? Sales? Marketing? Could it be the physical location of your retail space? It could also be the way that you execute.
Weakness:
What are things that your organization does not do well? Is there a disconnect between sales and fulfillment? Does your leadership team send inconsistent messaging by not creating and allowing the same thing? Are you poorly suited for growth because of your cash position?
Opportunity:
Now, many will take their weaknesses and turn them into opportunities. These are not the same things. Opportunities are generally external. For example, perhaps a competitor who is moving out of a particular segment that your organization could compete in. Maybe there is a modified application for one of your products that meets an emerging need in the market. I’ll caution you in this space, however, that if everything is an opportunity, nothing is. It’s important to be specific, focused, and committed to your own vision, mission, and values.
Threat:
This is the place in which you identify obstacles to growth and challenges to progress. What economic factors are challenging the business? Are there new regulatory policies that could impact you? Are there stakeholders who your organization depends on that are changing direction? Is there a new competitor who may cut into your market share?
Summary:
In reviewing each of these areas, you can see the benefit in further understanding where your organization is winning, losing, how you can improve, and what could get in your way. This positions you uniquely to write a solid strategic plan that takes into consideration all of those factors and allows your organization to rightly deploy its energy and resources.