Plain and simple yet powerfully effective. A SWOT (Strength, Weakness, Opportunity, Threats) analysis is the perfect method to quickly identify what your main business issues and risks might be as well as highlighting the things that you do well. Its a great idea to do this with any stakeholders or other important players in the business (such as staff, key customers etc.) as they have often got very different perspectives and opinions on the running of the buinsess.
A SWOT analysis can be applied to any business no matter the stage it is at, from a 100-year-old established brand to a newly started venture. By following these 5 simple steps to performing a simple SWOT analysis a little bit of clarity can be found when times get a little foggy.
The set Up
The generic formula for a SWOT analysis is to split a page into a simple 2-by-2 grid labelling an area with the corresponding titles: strength, weakness, opportunity, and threats.
Step 1: Get yourself a group
To maximise the effectiveness of a SWOT analysis you need to gather as many different perspectives of the business as possible, from those internally close to the business to those who interact with it externally, in order to establish a well-rounded understanding. Doing a SWOT analysis is similar to brainstorming meetings. A good way to ensure a correct approach is taken is to give everyone present a sticky-note and have them quietly generate ideas on their own to start things off.
Step 2: There is strength in your weakness
The next step is to get your dynamic group to think about the business’ strengths and weaknesses by having them list each of their own points on their own sticky note. The point of this is to get a view of what people specifically identify as a strength and a weakness from their position in the business. This will be beneficial as a more rounded perspective will emerge, one that hasn’t been influenced by group thinking.
Step 3: Vote!
Once all the observations have been laid out in the open it is time to sort each observation into a category. For example, is Susan from the shop floor’s observation about the business’ opening time missing the morning rush a strength or a weakness to the business? Well, if you are missing a key time period that is potentially profitable, it’s a weakness – so that observation would fall under weakness, and so on.
Step 4: Prioritise
Now it’s time to get to work. All of the listed observations from your dynamic group need to be prioritised and whittled down to a top 3 of what’s most relevant to the business’ current situation and its future. So, Jenny’s concern about the business next door implementing a new marketing strategy similar to yours overthrows Jim’s observation for the need of a new coffee machine in the canteen (although, at heart we all know a broken coffee machine is a real threat to a business, so that problem should also be solved, pronto).
Step 5: Put it into action
Now that you have a solid top 3 in each category hopefully a well-rounded picture will start to emerge. The idea now is to take your biggest weaknesses and turn them into strengths and to take your biggest threats and turn them into opportunities. For example, If your top threat is a new business moving in next door, then now would be a good time to see how that threat can be turned into an opportunity to stand out and gain new customers.
And you’re set!
It’s that simple. Like it was said before, everyone from startups to existing businesses can use a SWOT analysis to assess their current situation and determine a strategy to move forward. But remember, things are constantly changing within your buisness and you’ll want to reassess your strategy by starting with a new SWOT analysis every 12 months or earlier if needed.
For more tips and tricks to simplify your workload, sign up to Branswer today.