If you’ve ever thought about doing a SWOT analysis of your business, there’s never been a better time to start. With all of the incredible digital tools at your disposal, you can perform a thorough analysis quite easily. Whether you’re looking for a SWOT analysis example, a detailed how-to guide, or simply some tips on how to perform a better analysis, the web has plenty of resources available to take advantage of.
Here’s how to do a detailed SWOT analysis step-by-step. We’ll cover what a SWOT analysis is, how it helps, and how you should be performing yours.
SWOT is an acronym that stands for Strengths, Weaknesses, Opportunities, and Threats. This analysis covers the four critical aspects of your business and can be performed whenever you’re enacting major changes, introducing new products, or just want a better idea of where your business stands in the industry.
A SWOT analysis is usually performed by a group of people, much like a brainstorming session. You’ll host a conference, set up a SWOT chart or print one off, and each person will offer his or her input in each section. The idea is to write down everything that gets suggested and then compare/discuss each point.
Who Should Participate?
The answer to this question largely depends on who the information effects. Yes, it will affect the company as a whole, but who specifically in your organization needs to understand the components of the SWOT analysis, or will be able to offer valuable input? Think of your SWOT analysis as a streamlined meeting. Who should really be there and who doesn’t need to be?
Let’s say you’re looking to introduce a new product. You want to do a SWOT analysis, but you’re unsure who to invite. You’ll probably want your marketing team present, but you might not need to invite someone from human resources.
The best way to iron out a list is to write down everyone’s name and position and start eliminating people based on what their expertise is. You want your SWOT analysis to be as streamlined as possible, not bogged down by excess chatter or people that don’t have a stake in what’s being discussed.
The first item to discuss is your business’s strengths. It’s important to have everyone participate, because you may not even be aware of certain things. Maybe you didn’t know that your business is really great at budgeting money, but the accountant points this out during your SWOT analysis.
Focus on the things that your business is known for. Do you have excellent customer service? Are your products top-notch? Are you known for consistency or fair pricing? What about internal strengths like budgeting or a team that works well together?
These are some general strengths to consider, but depending on why you’re performing the analysis, you may want to focus only on strengths directly related to the reason behind your SWOT analysis.
Nobody wants to talk about their weaknesses. It can be painful and personal, even when it comes to a business. If you’re the business owner, you may be inclined to take these things to heart, but it’s important to remember that awareness is the best path to growth. You can’t solve a problem if you don’t know it exists!
Focus on the things that are the most difficult to talk about. Is your business failing in the area of customer service? That’s a weakness that has a solution. Once you identify a weakness, ask yourself a few questions:
- What are the conditions of this weakness? (What’s causing it in the first place)
- How does the weakness negatively affect the business?
- Which areas are specifically affected by it?
- What changes can we enact in one, six, and twelve months to address it?
- How will we know that the weakness has been successfully addressed?
Don’t shy away from your business’s weakness. If you want to grow as an organization and earn your place in your industry, you must identify and fix the things that are holding you back from being great.
Opportunities & Threats
At last, we come to the final two terms in the acronym: opportunities and threats. These are two sides of the same coin. An opportunity is something you can act on that will benefit the business, whereas a threat is a looming condition, action, or factor that’s out of your control that will negatively affect the business in the coming weeks/months/years.
Each of these is equally important. Opportunities can push your business to new heights, and threats can knock you back down to phase one. Even seemingly minor things can be a threat to a business. If you’re having trouble keeping employees, this can be a serious threat down the road.
Once you’ve identified your opportunities and weaknesses, figure out which opportunities you want to take and which threats need immediately addressed.
Your SWOT analysis is now complete! All you have to do now is follow your newly formed plan. Good luck!