What is SWOT analysis? SWOT is an acronym for Strengths, Weaknesses, Opportunities and Threats. Most people conduct SWOT analyses using a simple matrix like the one in the photo above. This matrix will help you write a SWOT analysis and organize your thinking about where your company is, what is the competitive environment you’re operating in, and what things you should take into consideration when doing strategic planning.
Most people consider their strengths and weaknesses as internal criteria for analysis and opportunities and threats as external. Ideally, though, you should conduct this analysis not only for your organization, but for the competition as well. No matter how good a SWOT analysis of your own company is, if you don’t consider the strengths, weaknesses, opportunities, and threats of your main competition, you haven’t adequately analyzed the business environment you’re operating in.
SWOT analysis is an excellent beginning to strategic thinking, but you should continue your thoughts with questions like these:
- Do you have the resources to take advantage of opportunities?
- Who can you partner with to get needed resources?
- What is your biggest threat and do you have what you need to overcome it?
- Did you adequately analyze all your competition including companies that aren’t in your industry?
- What are the breakthrough innovations that might change the business environment?
- Is it possible your strengths could become weaknesses?
- Can you turn your weaknesses into strengths?
- How do you offer the most value to your customers?
- What is your main value proposition?
- What are the most critical success factors to focus on this year? In the next 18 months? Over the next 3 to 5 years?
Take a look at a sample SWOT analysis.
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