How can you use SWOT analysis to make better strategic decisions?

It's also important to note the tools and resources at hand. Do you have the staff and do they have the skills for your objective? Will you have to spend time hiring or training people? Do you have budget to meet your vision? Once you know the nice-to-haves, you can cut your coat to fit your cloth for the must-haves.

SWOT is used for many analyses in business and because it starts with the S, most start with their strengths. You will get much better results if you start with the external Opportunities and Threats so that you look at them independently, at first.

SWOT can be effectively used to analyse a situation with a 360-degree perspective. It allows us to analyze internal as well as external factors that may impact the subject matter. If performed properly, it can be used as a strategic tool for developing action plans for taking advantage of our strengths and the opportunities available in the marketplace.

However, your metrics, goals, and even mission don’t need to be defined ahead of time. It’s primarily the scope (geography, function, timeframe) that lays the foundation for a successful SWOT analysis.

This is not where you turn your weaknesses into strengths like a job interview. Here, it’s really important to get really honest so that you’re not stuck overpromised and underdelivered. Removing personal bias allows for a truly reflective self discovery grounded in reality.

In my experience, SWOT can be a really useful tool but the key to unlocking it is to be very honest in both of these areas. Understanding and identifying the strengths we have, (as individuals or businesses) and the areas where we have gaps in our knowledge, skills or experience will enable us to clearly identify the next steps to help us reach our goals and objectives. If we are committed to truly challenging ourselves when undertaking a SWOT analysis, the results can be significant

In my experience it is also useful to involve external customers as part of an independant workshop. This will give you the most honest feedback and may also identify an area of Strength or Weakness which you had overlooked, or at least not rated as important.

In ascertaining SWOT, various sessions at the mid management level must be held to senior management level to bring the most quality and quantity of the SWOT forward for strategic deliberations.

It helps to remove the emotional component from terms like "weaknesses." A weakness is an opportunity to identify areas for potential improvement. Often the solutions to weaknesses becomes strengths, and innovative solutions can become your "secret sauce" to help clients who struggle with similar issues. You will find that weakness and opportunity often overlap, and more opportunities will open once certain weaknesses are resolved. In short - look at all aspects of the analysis logically, not emotionally, and think of ways to leverage your internal solves for further opportunities (a SWOT jujitsu).

I personally feel disruptive technologies is reshaping industries and economies at an unprecedented rate. In step 3, I think performing a PESTEL (PEST) analysis is vital as organizations must understand the significance of rules and regulations before going into detailed strategies.

References to other tools & analysis methods should be briefly explained or linked for further reading: - What does PESTLE stand for? - What are Porter's five forces? To help exemplify opportunities & threats you could provide one example of each with a hypothetical scenario.

Well said! In addition special research must be done in your industry in order to be able to identify some other hidden threats and opportunities as it affect your industry globally and locally.

First thing to do is find out what the total market is. I don't see that anywhere. Nothing is important without knowing how big the market is. Make estimates. Add every possible customer into your database and make an annual purchasing estimate for those guys and then constantly update it. Keep a list of all potential customers in front of everyones' eyes at all times EVEN if their buyer wants nothing to do with you. He may run off with the receptionist next month and you can start over. Know the market size and update it on a regular basis. Teach your sales people to find these things out and train them. Tell them it will help them to earn more commissions.

Don't get too creative here unless you are deliberately trying to diversify. Be real and be honest with yourself and with others - postering and marketing should be left at the front door for this one

Setting priority levels should take a balanced view of both the short and long term, weighing the costs and risks invested into a particular thing against the reward it might yield.

Probability matrix can also be used to get both worst case scenario and best case scenario in analyzing and priotising the SWOT factors.

Prioritize those things that will move the needle - everything else is just noise. The analysis is often where some complex numbers should now come into play - how much, by when, and where

We are able to identify competitive advantages: By evaluating your strengths and weaknesses, you can identify areas where your business has a competitive advantage or where improvements are needed. This analysis helps you differentiate yourself from competitors and capitalize on your unique selling points.

Perfectly on point. SMART tools will be a perfect way of making a good plan with a good team communication. This will highlight why the plan, how to measure the progress and expected result anticipated.

3. Match opportunities with threats: Identify how the identified opportunities can help minimize or counteract the identified threats. For example, if a threat is increased competition, an opportunity could be to invest in research and development to develop innovative products that differentiate your organization from competitors. 4. Develop strategies: Develop strategies that utilize the identified opportunities to minimize the impact of threats. This can involve diversifying your product offerings, improving operational efficiency, or investing in new technologies.

Gantt chart, RACI matrix, or SMART are all great techniques - Personally, I like the KIS method - Keep it Simple. Who, What, When Where - and goal to back this up.

To create a successful plan, it's important to gather input and feedback from your team. This ensures that everyone is on the same page and invested in the plan's success. Encourage open communication and collaboration, and be receptive to ideas and suggestions from all team members. Also, incorporate logic and emotion when presenting the plan.

SWOT is a good start, but the real payoff comes from combining some of the elements of SWOT. For example, Strengths and Opportunities (SO) – How can you use your strengths to take advantage of these opportunities? Strengths and Threats (ST) – how can you take advantage of your strengths to avoid threats, potential and real? Weaknesses and Opportunities (WO) – how can you use your opportunities to overcome the weaknesses you are experiencing? Weaknesses and Threats (WT) – how can you minimize your weaknesses and avoid threats?

As a business stakeholder, you can use a SWOT analysis for strategic planning. For example, a SWOT analysis helps you understand your business’s internal strengths and weaknesses, as well as external opportunities and threats. This information guides your strategic planning process, allowing you to make informed decisions and set goals that align with your business’s capabilities and market conditions.

SWOT analysis is not a one-time exercise. It should be reviewed periodically to adapt to changing circumstances. Reassess your strengths, weaknesses, opportunities, and threats to ensure that your strategic decisions remain relevant and effective.

When completing a SWOT analysis do not keep this in the boardroom. Include key people with experience throughout the building. Often those in production, sales, distribution, etc. have a clear, and different, viewpoint of your company's position within the industry. They work with suppliers, customers, other businesses and see and hear things. Use that knowledge. Often your production team knows of opportunities and have never been asked. Your warehouse can see a supply line threat coming before your accountants.

It's important to differentiate between facts and assumptions. A SWOT analysis includes insights that are subjective, and should not be interpreted as facts. It helps to keep this in mind & validate with peer feedback or external benchmarks if what is assumed to be a strength or a weakness is indeed the case.