By Joe Smith
Developing business plans and strategies can be complicated.
But it does not have to be if you remember to focus on the basics. For example, when was the last time you did a Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis? And if you have not done one yet, now is the time.
First credited to Albert Humphry who led a research project at Stanford University in the 1960s and 1970s to help identify why corporate planning failed, SWOT analyses have become a standard business practice with a proven track record.
Conducting a SWOT analysis can be difficult to do on your own. If you have employees, make sure they are participants in the process. If you operate on your own, get some help. You need to be as objective as you can possibly be in order for this kind of analysis to be successful. If you are not familiar with the process, a simple internet search will give you thousands of pages of information.
Here are some simple tips to help make your analysis work for you:
First, be honest. Looking inward — especially at weaknesses — can be uncomfortable. You need to be able to face these criticisms with an open mind. The objective is to be able to turn these weaknesses into opportunities for improvement.
Second, there is no point in conducting a SWOT analysis if the outcome is not focused on obtaining an objective. It is essential that it is part of an overall strategic and business planning process.
Third, understand that the primary purpose of a SWOT analysis is to gather information in four specific areas as outlined below.
Strengths: You will find these are internal to the organization. They will be positive attributes that set you apart and are within your control.
Weaknesses: Like strengths, they are mostly internal factors, but in this case, they hinder or detract from your ability to move forward. The good news however, is that they fall within your control and point towards areas for improvement.
Opportunities: The reasons why you are in business. These are the external circumstances that arise to help expand your customer base, further develop existing marketing efforts or point you in new directions.
Threats: Never underestimate the market or the competition. These are factors that are often out of your control and can put your business at risk. You need to be able to recognize them and develop strategies to mitigate their impact.
A SWOT analysis is not the be all and end all of business or strategic planning. But it can be one of many business tools that help provide direction.
Joe Smith is a communications consultant and an accomplished fine artist. He can be reached via email at joesmith@shaw.ca