With any decision, there are a series of evaluations that can be done to decide what, if any, course of action should be taken. There are a number of influential factors that can weigh on the outcome of these decisions, and a SWOT analysis is a helpful tool to aid an organization (or individual) to make an informed decision using some of the lower level details of the business.
An acronym for Strengths, Weaknesses, Opportunities and Threats, here’s how you can apply a SWOT analysis to help your decision-making process.
What are the strengths of your organization? This could be anything from a service you offer that a competitor does not, a low-cost, but quality product you provide your customers, or excellent customer service. When in doubt, make a list. Not all companies operate in the same manner, so strengths will vary. What positive internal factors of your business do you control?
Being realistic about what your organization is lacking is crucial to making necessary improvements. Whether you are seeking more profit or expansion, gathering these insights can help you work toward the bigger picture. Do you need to re-do your budget? Could you benefit from fixing gaps in knowledge or expertise on your staff? Answering questions like these provide guidance to meeting organizational goals.
Sometimes great things can happen when we are able to seize a great opportunity. In a SWOT analysis, identifying these external factors could help immensely to change the course where an organization is headed. Paying attention to technological advances, social patterns and other trends can help you stay innovative and tailor your processes to fit these changes. You may find your competition has no social media presence, a poorly designed Website or is not up to date on trends in your market. These are opportunities you should seize to keep your company relevant.
What’s standing in your way from profiting or growing to your fullest capacity? Is there new competition in your field, an economic recession or are you at a seasonal disadvantage? Identifying these obstacles is a necessary step to overcome the challenges they’ll surely bring to your organization.
The SWOT tool helps you summarize some of the seemingly small factors that can contribute to the success (or failure) of your organization. When you equip yourself with tools like a SWOT analysis to better understand your organization and the factors that impact it, you can make appropriate decisions to help your company flourish.