To create strategy with SWOT analysis there are only four steps which need to be done:
ANALYSIS: Think about and identify features, then group them into four categories: Strengths, Weaknesses, Opportunities and Threats (you can read more about it below).
SELECTION: Select the most valuable and important features from each category (read more).
EVALUATION: Prioritize features by assigning an importance factor to each of them (read more).
CONNECTION: Identify an existing relationships between the categories to identify the impact of each feature on your final strategy (read more).
STRATEGY: At the end of the process you will receive full summary of pertinent data, as well as a recommended strategy for your current situation and suggestions for future actions (read more).
Today we will focus on the first step – Analysis.
This step is essential to the success of the entire analytical process. Here we need to be honest, open, creative, but also realistic. If it is possible, try to involve additional people in the process for a brainstorming session (e.g. such those drawn from your business or friends that know you well). Consider each of the four SWOT areas in turn, and write down all ideas, suggestions and comments. Here are some example questions which might help you complete categories:
- In which areas do you do well?
- What are positive factors that make you different from your competitors?
- What advantages do you have over your competitors?
- What distinguishes your company from others?
- What kind of assets do you have, and which are most helpful?
- What kind of processes do you execute well?
- Do you have products which help to build your competitive advantage?
- What positive things do other people, and particularly customers say about your business?
- High income and positive cash flow (high ROI)
- Prepaid payment model for products, no expenses for debt collection process
- Good relationship with customers and loyal clients
- Small company can change and adapt quickly
- Can you do anything better?
- What should be avoided?
- What areas of your business need to be improved?
- If you could change one thing about your business, what would it be?
- What causes problems or complaints?
- Are there some financial limitations which can slow you down?
- Bad internal communication
- Lack of willingness for change in the organization
- Lack of connections that might help at the beginning
- Lack of experience in running a company
- Are there any good opportunities ahead of you?
- What are the interesting trends you are aware of?
- What alternatives are available to you?
- Is there a customer base for you to target?
- Is the environment in business a friendly one?
- Possibility to expand on external markets
- Possible new distribution areas (fewer costs, more available clients)
- Changes in government policy or regulations / legislation
- Lack of this kind of product in the market
- What obstacles do your business face?
- What are your competitors doing, which may become a threat?
- Are there any changes in products, services or technology which could threaten your business?
- Are there any potential changes in laws which may harm your business?
- Do you have any financial problems such as bad debt or cash-flow difficulties?
- Client would abandon your company, because of slow improvement in the quality of service
- Existing product becoming unfashionable or unpopular
- Existing competition
- Downturn in economy may cause people to spend less
Take your time and work methodically through the process – this approach will produce the best results in the end. Use SWOT analysis as a guide, but remember that it can be very subjective. Be aware that two different viewpoints may result in different perceptions of strengths, weaknesses, opportunities and threats. You can always come back to your SWOT and modify it as environmental and external factors changes.
And last but not least, facilitate the whole process with the intuitive tool, which will guide you through the analysis: CayenneApps Tool for SWOT analysis.
Read next: Selection step