Why Complete A SWOT Analysis And How To Use It

A SWOT Analysis is a simple and commonly used analysis tool with four distinct parts that examine the things that can affect a business.

There are two parts that are internal-facing. Therefore, the business has greater control over what can be done about the specific issues that emerge.

There are:

• Strengths

• Weaknesses

The next two mainly take an external view of things that affect the business, therefore, the business is much less in control over the issues:

• Opportunities

• Threats

You can also take the perspective of what is helpful vs. harmful to the business.

• Strengths and Opportunities are helpful

• Weaknesses and Threats are harmful

SWOT Analyses can often be used within business plans, marketing strategy plans and other business planning documents.

Despite their simplicity, SWOT Analyses can often contain insights that can make or break a business. But many businesses either don’t bother to complete one, don’t periodically update, or don’t use the output of their SWOT Analysis.

Why complete a SWOT Analysis?

The benefit of completing this analysis as part of a planning process is that it gives a view of the business situation at a glance, which helps think about how to engineer the strategy, taking account of everything in the SWOT.

For startups, or for example a business launching a new product or service, it’s far better to complete a SWOT Analysis before developing a marketing strategy and tactical plan, than to begin executing the marketing tactics and having to react to things that could have been anticipated.

Businesses, products and service offerings that are further along should also absolutely use a SWOT Analysis. They can help make some vital changes that help the business survive and hopefully perform at its best, by taking a step back to keep an eye on the bigger picture, especially the changing external environment.

Many businesses and entire industries have been wiped out because of things that could have been anticipated, or were anticipated but ignored. These businesses could have made strategic adjustments to mitigate the risks.

I’ll let you decide whether that’s irresponsible, short-sighted, complacent, arrogant, silly, or something else.

How to complete a SWOT Analysis

The image below plots out a typical SWOT Analysis. Recreate the table using your favourite document or presentation software, pen and paper or my favourite, a whiteboard.

You should be specific rather than generic by focusing on whatever you want to complete the analysis for, such as your business as a whole, your product or service, etc.

Then begin to brainstorm, perhaps with a colleague and add issues as they spring to mind.

You don’t have to complete it in any specific order. Just keep going until you can’t think of anything else worthwhile adding.