Have you ever tried to figure out what the next problem is that you need to solve but didn’t know where to start? Do you find yourself tossing and turning at night because you are worrying about whether your company is going to succeed?

Imagine if you could quickly and easily document the internal and external threats to your project or company, and get your team focused on taking advantage of your opportunities and strengths while minimizing any threats or weaknesses.

A SWOT analysis is exactly what you need to do in order to organize your company’s greatest strengths, weaknesses, opportunities, and threats. The point of this type of analysis is to help you develop a strong business strategy for a new business venture, and/or to re-examine the strategy of your current business.

How to do a SWOT Analysis

Gather a group of people with different perspectives from your company — this type of analysis works best with a group that has varied insights — and hold a brainstorming session so everyone can contribute ideas to the SWOT template.

Once your brainstorm is done, create a final version of your SWOT and list the factors in each section from the most important to the least.

Think of Strengths and Weaknesses as internal influences that can be changed or controlled by you and your team, and Opportunities and Threats as external influences from the greater market.

Strengths

Consider your strengths from both an internal perspective, and from the point of view of your customers and people in your market. If you’re having difficulty identifying strengths, try writing down a list of your organization’s characteristics. Some of these will hopefully be strengths!

Be sure to think about your strengths in relation to your competitors. For example, if all of your competitors provide high-quality products, then a high-quality production process is not a strength in your organization’s market, it’s a necessity.

Consider the following questions:

  • What advantages does your organization have?
  • What do you do well?
  • What can you do better than the competition?
  • What are the changes in your market that your company can rise to (population profiles, lifestyle changes, etc.)?
  • Do you have strong internal resources (both people and tangible assets)?
  • What factors mean that you “get the sale”?
  • What is your organization’s Unique Selling Proposition (USP)?
  • What do people in your market see as your strengths?
  • What unique or lowest-cost resources can you draw upon that others can’t?

Examples of strengths:

  • We can change direction quickly if we find that our marketing is not working.
  • We have low overhead so we can offer good value to customers.
  • As a small company, we are able to respond quickly as we have no red tape and no need for higher management approval.
  • Our lead consultant has a strong reputation in the market.
  • We are able to give really good customer care, as our current workload is small in comparison to our competitors.

Weaknesses

Consider your weaknesses from both an internal perspective, and from the point of view of your customers and people in your market. Be sure to think about your weaknesses in relation to your competitors as well.

Consider the following questions:

  • What are people in your market likely to see as weaknesses?
  • What factors lose you sales?
  • What should you avoid?
  • What could you improve?
  • What are things you are doing that are making you less competitive?
  • Do you have limited resources?
  • Is the location of your business hindering growth?

Examples of weaknesses:

  • Our company has little market presence or reputation.
  • We are vulnerable to vital staff being sick or leaving.
  • Our cash flow will be unreliable in the early stages.
  • We have a small staff, with a shallow skills base in many areas. 

Opportunities

A useful approach when looking at opportunities is to take a closer look at your strengths and ask yourself whether any of them will open up any opportunities for you. Alternatively, take a look at your weaknesses and ask yourself whether you could open up opportunities by eliminating them.

Consider the following questions:

  • Where are the opportunities in your market?
  • Do people perceive your business in a positive way?
  • Is timing a factor in the growth of the company?
  • Are there any local events you can take part in to gain exposure?
  • Have there been any changes in government policy related to your field?
  • Have there been any major changes in technology or your markets on both a broad and narrow scale?
  • What interesting trends are you aware of?
  • What good opportunities can you spot?

Examples of opportunities:

  • Our business sector is expanding, with many future opportunities for success.
  • Local government wants to encourage local businesses.
  • Our competitors may be slow to adopt new technologies.

Threats

When looking at threats, using a PEST Analysis (political, economic, socio-cultural and technological) can help to ensure that you don’t overlook external factors, such as new government regulations or technological changes in your industry.

Consider the following questions: 

  • Do you have bad debt or cash-flow problems?
  • Who are your top competitors and what are they doing?
  • Could any of your weaknesses seriously threaten your business?
  • Is changing technology threatening your position?
  • Are quality standards or specifications for your job, products or services changing?
  • What obstacles do you face?
  • Could external factors put the business at risk?
  • Have there been any major shifts in our consumer base?

Examples of threats:

  • A small change in the focus of a large competitor might wipe out any market position we achieve.
  • Developments in technology may change this market beyond our ability to adapt.

Now what?

Once you have created a final version of your SWOT analysis, use your factors to develop some long and short-term goals. Review the data and think about what actions you should take for each quadrant. Make sure to review this document regularly to see what has changed.

Conclusion

Doing a SWOT analysis helps to quickly identify threats you may not have thought about, allowing you to tweak your product or business plan in order to minimize those threats and create new opportunities.

It works because it forces you to think about what is happening in the present and what could happen in the future. It is easy to focus on one or the other and not compare and contrast to make projections. The analysis also helps look at the positives vs. negatives (Strengths & Opportunities vs. Weaknesses & Threats) to give a balanced and honest view of where you are at.

This is a very simple exercise that is invaluable when it comes to gauging where you’re making progress with your product or business or re-prioritize to take advantage of future opportunities and minimize threats.

Perform a SWOT Analysis using Stormboard so that your ideas and results will be there for you to come back to, review, make changes in, and use for regular meetings as you discuss your ongoing strategy!