Having a clear business strategy is key and a SWOT analysis can deliver just that. If your strategy has taken a backseat a few years into your business, now’s the time for a refresh. Revitalizing your strategy and staying current could reveal new opportunities and help you strengthen your business. It can also help discover weaknesses and threats from outsiders. A SWOT analysis has helped many businesses refocus and continue growing.
What is a SWOT Analysis?
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats: four forces that can help and hurt your business. Conducting a SWOT analysis allows you to dive deeper into your company from an operations angle; uncovering the driving forces behind your business and the ones holding it back. It’s important to make data-based decisions, instead of relying on a gut feeling or anecdotal evidence. Below, we will dive deeper into each force and provide examples to help you kick-start your own SWOT analysis.
That sounds great, right? But how long is this going to take?
The answer varies. You can spend as much or as little time on your SWOT analysis as you’d like. There are no set page lengths or numbers for a standard SWOT analysis. The length can vary from business to business because every industry and business type is different. Just try to go as in-depth as possible in a short period. This will help plan for future action based on what you uncover – before it’s too late.
Why Do a SWOT Analysis?
What could I discover about my business that I don’t already know? What’s the point?
The exact point is that no one knows your business better than you! This process will take you out of your everyday thinking about your business and help you look at each strength, weakness, opportunity, and threat more objectively, in a new light.
How can you capitalize on these strengths and opportunities? How can you fix weaknesses? How can you avoid outside forces from pressing and pulling on your business?
Strengths and Weaknesses
Strength and weakness are the two factors that focus on the internal portion of your company. This is the section of the analysis where you will dig into what you’re doing well and where you can improve. Be honest with yourself and don’t hold back. Strengths may range anywhere from a strong staff to great project turnaround time. Get creative, think outside the box. What sets your company apart? Weaknesses may include poor internal communication, or not enough budget for marketing or IT services. It may be challenging to expose downfalls but for the SWOT analysis to be useful, this step is critical. Exposing your businesses’ weaknesses leads to solutions, and solutions lead to a better business.
Opportunities and Threats
Opportunities and threats highlight external factors that might affect your company. If you do not already, closely track the segment your business is in. This portion of the analysis could require extra research or market knowledge to be truly successful. The opportunities section is your chance to discover untapped markets, customers, products, etc. Go big. Ideas can always be put on the back burner or approached in less costly ways. You never know what one idea can spiral into, and big opportunities may mean big results. The threats section will help you get all possible competitors, market changes, layoffs, etc. out in the open. Knowing who and what your businesses threats are will help you be better prepared to handle them.
==>For more examples of each element of the SWOT analysis, please scroll to the bottom of the article.
Who Should Do A SWOT Analysis?
This process can be used to set up a new business with operational goals, or to refresh an existing business. There isn’t one type of market or business type that benefits the most from a SWOT analysis. All companies can benefit. But don’t be sucked into thinking that only top management should be involved in this process. While top management may hold the keys to action, employees tasked with running the day-to-day components of your business can bring great insight to the table. Talking to everyone in a small business or the main players from every level in a more substantial company could help create a full picture SWOT analysis to boost your business forward.
Overview: The Main Takeaways
- -SWOT stands for: Strengths, weaknesses, opportunities, and threats
- -Strengths and weaknesses are internal factors
- -Opportunities and threats are external factors
- -Be as honest as possible
- -Do not hold back! Big ideas could create big results
- -All businesses can benefit from a SWOT analysis
- -Get everyone involved: more insight is better
More Examples of SWOT Analysis Elements
While your SWOT analysis may run much longer, here’s an overview of the four elements that may trigger some ideas for your own analysis.
Many returning customers
Customers are satisfied
High traffic location
Reputation for innovation
Knowledge of existing products
Website is not optimized
Social media is inactive
Low follower counts
Not meeting deadlines
Cash flow problems
Poor record keeping
Increase the use of social media
Optimize web page
Take advantage of new (food, travel, etc.) trends
Customer demand rising
Product will be on the market at peak time
New competition entering market
Competitors running big ads or teaming up with large partners
Competitors have similar products
Economy is in a downturn
Here are a few great examples that could be used for these elements if you need more inspiration to kick-start your SWOT Analysis. Happy analyzing and get ready to kick your business up a notch!