What’s SWOT, it’s not nerdy, that’s what!
To enjoy the process of being in business, one key activity guaranteed to bring the shoulders down, is a SWOT Analysis.
Why? because it allows you to quickly tap into 4 key areas of business health.
Much like we listen to our head, body, heart, as a measure of personal health. This is a health check for your much loved business.
Grab a pencil and paper, a square split into 4 smaller squares on your computer and take time to read through the 4 statements below.
Then the questions that follow on.
All of the below areas form part of your Business Model, and if you haven’t started this yet, here is a link to my article on business modelling.
Mark out a square with a cross in the centre and put strengths, weaknesses, opportunities, and threats into each square. And start to brainstorm.
I would highly recommend you do this with someone also in business. Giving you another head for creativity, innovation, and questions you may shy away from.
Strengths
These are the unique advantages and internal capabilities that give your business a competitive edge in the market. A strong brand reputation, innovative products or services, or exceptional customer service are just a few examples.
By identifying and capitalising on your strengths, you can strengthen customer loyalty and build a solid foundation for growth.
Weaknesses
As we know, no business is flawless, so there will be areas where you may face challenges or fall short of your potential.
It could be outdated processes, skill gaps, or inadequate resources.
And by acknowledging these weaknesses, you can establish targeted initiatives for improvement, adopt new technologies, and enhance your operational skills.
Opportunities
These are important external factors that can contribute to the progress of your business.
Such as emerging markets, technological advancements, changes in buyer behaviour, or gaps in the market that your business can fill.
By seizing these opportunities, you can expand your market reach, align your product offerings, create key partnerships, or even venture into untapped markets.
Threats
Unpleasant as they are, we need to understand what is beyond your control and could pose challenges to your business.
Such as, increased competition, economic insecurity, changing regulations, and even changing market trends are examples of threats.
By proactively assessing and addressing them now, you can develop contingency plans, adjust your strategies, and minimise their impact on your business.
To help you work through the SWOT analysis here are some helpful questions.
Strengths in SWOT
Think of your value offerings that are performing well.
Examining these areas helps you understand what’s already working. You can then use the techniques that you know work—your strengths—in other areas that might need additional support, like improving your efficiency.
When looking into the strengths of your business, ask yourself the following questions:
- What do we do well? Or, even better: What do we do best?
- What’s unique about my business?
- What does my target audience like about our business?
- Which categories or features beat my competitors?
Example SWOT strength: Coaching – training, experience, specialist or niche knowledge, existing connections, network, communication skills, listening skills, testimonials.
Weaknesses in SWOT
Here consider what is underperforming.
It’s a good idea to analyse your strengths before your weaknesses in order to create the baseline of success and failure.
Identifying internal weaknesses provides a starting point for improving those projects.
Identify the company’s weaknesses by asking:
- Which areas/programmes are underperforming and why?
- What can be improved?
- What resources could improve my business performance?
- How do we rank against my competitors?
Example SWOT weakness: E-commerce – Our visibility is low because of a lack of marketing budget, leading to a decrease in interactions/enquiries/sign ups.
Opportunities in SWOT
These should come from your existing strengths and weaknesses, along with any external initiatives that will put you in a stronger competitive position.
These could be anything from weaknesses that you’d like to improve or areas that weren’t identified in the first two phases of your analysis.
Since there are multiple ways to come up with opportunities, it’s helpful to consider these questions before getting started:
- What resources can we use to improve weaknesses?
- Are there market gaps in our services?
- What are our business goals for the year?
- What do our competitors offer?
Example SWOT opportunities: Marketing campaign – To improve brand visibility, and be more memorable – create a brief that covers the impact we seek: right tone of voice – matching our audience, brand personality, tag line.
Threats in SWOT
These areas have the potential to cause problems.
Different from weaknesses, threats are external and out of your control.
This can include anything from a global pandemic to a change in the competitive landscape.
Here are a few questions to ask yourself to identify external threats:
- What changes in the industry are cause for concern?
- What new market trends are on the horizon?
- Where are our competitors outperforming us?
Example SWOT threats: New competitor – With a new e-commerce competitor set to launch within the next month, we could see a decline in customers.