SWOT Analysis – A step by step guide
As the Coronavirus (COVID-19) pandemic disrupts the global economy, everyone should conduct a SWOT analysis to help prepare for a new, and hopefully brighter, future.
So, what is a SWOT analysis?
It’s an efficient tool to determine the strengths, weaknesses, opportunities, and threats that are facing your business.
In a SWOT analysis, the strengths and weaknesses represent characteristics that are within your control referred to as internal factors. The opportunities and threats focus on external factors that could have an impact on your business, project, or product and which are out of your control.
SWOT analysis is a practical method to help you analyze the current situation and help you in planning for the future.
The SWOT analysis process can be used by anyone in a personal or professional context and is very useful as a brainstorming tool for teams to come together to discuss different perspectives on a situation at hand.
It helps in finding new solutions to problems and deciding on the best course of action.
Successful leaders use this simple tool on a regular basis to help them develop their strategy and course of action. It’s also an important tool to get better teamwork. In the process, different points of view are heard and the team can align with the decisions that are taken.
So, I’m sure by now you are convinced about the effectiveness of the SWOT analysis, let’s get right into it.
First, Determine the Strengths of your Business
When doing a SWOT analysis process, the first step is to determine the strengths of your business, or product or project. The strengths refer to positive things that are within your control and allow you to have an advantage over others. When applying this to a business, areas that are in your control include the team, your financial positions, your experience, or processes.
Here are 3 questions to ask yourself to help in determining your strengths:
- What makes us unique and different from others?
- What do people or customers praise us for?
- How are we better than others?
Second, Determine the Weaknesses of your Business
The second step is to determine the weaknesses of your business, or product, or project. The weaknesses refer to negative things that are within your control and that could put you at a disadvantage over others. When applying this to a business, areas that are in your control include the team, your financial positions, your experience or processes.
Here are 3 questions to ask yourself to help in determining your weaknesses:
- How to improve our business or product?
- What do people or customers tell us that we need to improve?
- Things we need to be avoiding?
Third, Determine the Opportunities for your Business
The 3rd step of SWOT analysis is to determine the opportunities facing your business, or product or project. The opportunities refer to positive things that are outside of your control and that could have an effect on you. When applying this to a business, areas that are outside of your control include future trends, economic, laws, or political issues.
Here are 3 questions to ask yourself to help in determining your opportunities:
- What are technological trends that could give you an advantage?
- Are there any laws, policies or economic situations that work in your favor?
- Are there any events taking place that you can leverage?
Fourth, Determine the Threats to your Business
When doing a SWOT analysis, the 4th step is to determine the opportunities facing your business, or product or project. Moreover, the threats refer to negative things that are outside of your control and that could have an effect on you. When applying this to a business, areas that are outside of your control include future trends, economic, laws or political issues.
Here are 3 questions to ask yourself to help in determining your threats:
- What are technological trends that could disrupt or affect us negatively?
- Are there any laws, policies or economic situations that could impact us in a negative way?
- Are there any market financial risks that could be affecting us?
Taking Action after your SWOT Analysis
By completing the above 4 steps of SWOT analysis, you can then have a good overview of the current situation and be able to make a decision about moving forward.
As the next steps, you can put the actions needed to make use of the analysis. These would include:
- Leverage your strength and expand what you are doing well
- Minimize your weaknesses and avoid things that are not working
- Be prepared to make use of the opportunities that could be coming your way
- Be prepared to reduce the impact of threats that you could be facing
As the saying goes, chance favors the prepared mind and through the SWOT analysis, you would be better prepared.
Time to take action – start creating your analysis by using Xtensio’s free SWOT and TOWS matrix template.
As a Conclusion,
We hope that through this SWOT analysis process, you would decide on the best course of action you need to take to achieve your set goals.
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