What if I told you there was a way to turn all of your company’s Threats and Weaknesses into Strengths and Opportunities? Sounds good, right? This, dear readers, is the basis of a SWOT analysis. This tool exists to give you a snapshot of your business (both internal and external) and address these critical aspects of your company. This type of examination is vital to any business, no matter age, size, or level of success.
First, look within and study your internal business practices. Strengths are what your business is already doing well. List out the practices that are helping you achieve success or advantages you have and that don’t need to be improved or monitored greatly. Examples may be personal years of experience or policies that make your company stronger. It could also include insight into the market or the way you do business. Weaknesses generally address internal areas where your company is lacking. Honesty is the key here. No one likes to look at this area, but it is vital in finding opportunities to improve. What is hurting your business’s chances for success? These can be things that you are already doing, not doing or bad habits.
From here, look outside of your company at external forces that could affect your business. Opportunities are the things that you haven’t yet taken advantage of and integrated into your business. This can include aligning with other businesses for joint ventures or working with philanthropic organizations for an improved reputation. An excellent idea is to take the weaknesses you just listed and counterbalance them with an opportunity for improvement. For example, if a weakness is lack of structure, an opportunity to improve that would be developing an employee handbook to outline the companies’ expectations. Opportunities are often endless, so, the first step is acknowledging what you’d like to be undertaking with your business that you aren’t currently doing.
Finally, Threats are the things that can ultimately destroy your business or at least, hurt it in some capacity. These are the external factors that you have no real control over. These can range anywhere from a problematic climate in your geographic region (i.e. hurricane season in the Southeastern U.S.) to an increasing number of competitors in your area. The bottom line is that you must identify what can hurt you so that you can find a way to plan for the worst.
When you complete a SWOT analysis, you should be able to find ways to utilize all of your strengths to protect you from the threats. You should be able to create an action plan, comprised of the weaknesses you plan to improve and opportunities you want to take advantage of. Evaluating your business in this way can help you see things more clearly and help you to know what steps to take going forward. Upon completion of your SWOT analysis, you should have a good idea of how bright your company’s future is.
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