Strategic planning. Continuous improvement. SWOT.
In the organizational world, these concepts and approaches to work are commonly expressed in strategic and daily tasks. You may or may not currently use them or even have heard of them. Anchored in forward-thinking development, methods like these depend on team collaboration and intention to accomplish goals and persevere in a set direction.
The concept of a SWOT analysis is one of the most popular and widely-used assessments. It helps to generate awareness of where a project, business or organization is currently at and where it has the potential to go.
So, what exactly does this method stand for, and why is it important to pay attention? Here we share the value of the SWOT analysis.
What is a SWOT Analysis?
The process of conducting a SWOT analysis is fairly straightforward, although it may take some time to develop. SWOT stands for strengths, weaknesses, opportunities and threats that you identify for yourself or within your organization. Conducting this type of analysis comes with several benefits and can be practiced at both an organizational and personal level. From economics and marketing to finances and nonprofits, SWOTs set a foundation that can be applied to just about any situation.
How Do You Create a SWOT Analysis?
Developing a SWOT analysis is in four parts, often divided into four quadrants of a square.
Step 1: Strengths
Ask yourself what you or your organization does well, what resources you have and what others may identify as key benefits in how you operate. These are YOUR advantages. Keep in mind that this strengths section is internally focused, directed on your specific characteristics and attributes that distinguish you from the rest of your competition. These strengths may include things like experienced leadership, low-cost internal resources and dedicated customer service teams.
Step 2: Weaknesses
No organization is perfect. In this step, you identify those internal characteristics or conditions that may cause your competition to rise above. Being honest is critical, as the more up-front you are about your true weaknesses, the more opportunity for improvement you may find. This may also address where you lack certain resources to compensate for. For example, this section is where you could include things like a small staff or a lack of capital in start-up funds.
Step 3: Opportunities
By Step 3, you’re ready to switch from an internal focus to an outward-facing perspective. At this point in the analysis, you focus on how you or your organization is positioned in the overall market or business environment. Both the opportunities and threats sections require initial market research and paying attention to the trends and predictions of the environment you’re in.
Opportunities include key advantages that heighten the competitiveness of your organization. Keep your eye out for market forces like changes in government policy, social trends and economic forecasts to see where you may be ahead of the game. The opportunities section can include things like growing awareness of your industry and local business development.
Step 4: Threats
Like weaknesses, the last step of identifying your threats may not be the most enjoyable in the analysis process. As with opportunities, threats are outward-facing and take into account the external market environment in which you’re positioned. These may be things that get in the way of your ambitious endeavors, like changes in quality standards or new innovations from competitors. While not always a mood-booster, identifying your threats may also spark additional opportunities, such as the change in technology.
In navigating through these four steps, you can develop a refined assessment of your benefits and areas of growth on both an internal and external basis.
5 Reasons Why You Need a SWOT Analysis
Diving into these four stages may take some time. What difference does the process make? Turns out, there’s a reason why this approach to analysis is so popular. Here are just five reasons why a SWOT analysis can help you advance your organization—or life.
1. Understand Where You Are
The strengths and weaknesses sections of the SWOT analysis encourage you to take an honest look at where you or your organization is currently. It will spark questions of whether you actually are as good as you think you are or assure that you’re much better off than you thought. This analysis invites you to be honest about your current situation as you move forward in strategic planning. After all, you don’t want to venture out into a new opportunity that doesn’t match your strengths or is discounted due to your weaknesses.
2. Aspire Toward What You Want to Be
After addressing your current situation, you’re empowered to move forward in strategic planning with opportunities and threats. These two externally-focused concepts ignite new ideas. It may also confirm your sought-out organizational direction.
Author Greg Reid notes the value of working toward aspirations when he said, “a dream written down with a date becomes a goal. A goal broken down into steps becomes a plan. A plan backed by action makes your dreams come true.” A SWOT analysis can help you follow those steps to reach those dreams.
3. See Yourself In Context
We may think we can get by just guessing what our strengths are and what we need to improve on. But taking a deep dive into each of these quadrants and asking the tough questions provides an honest look at your actual status in the overall market you compete in. You don’t operate or serve in a siloed environment but face influences from other players. A SWOT analysis helps you identify your position in such a context.
4. Grow in Professional Development
Conducting this type of analysis isn’t just for organizations. It can also be a practice you engage in on your own, analyzing your own status as a working professional. This can be particularly helpful if you’re beginning a job search or looking for new opportunities. Knowing where you’re at in skills and experience as well as where you want to be can be extremely valuable in moving forward in your goals.
5. Add to Your Toolbox
The SWOT analysis is a helpful tool, but it shouldn’t be the only one you use in strategic planning for your organization or for your life. There are several next steps you can take after you create your analysis, like a TOWS matrix, or conducting successful meetings. Overall, this analysis should be used in conjunction with other continuous improvement and strategic planning tools to help move you and your organization forward.
What Do Your Opportunities Include?
In the journey of professional development, opportunities for improvement are abundant. Investing in yourself through education can help add to your “strengths” quadrant and lower your “weaknesses.” It can promote new opportunities and minimize threats as you move forward in both your personal and professional life. Discover how education could be your opportunity by learning more about our degree programs.