3.05 B – SWOT Analysis Analyze This!

SWOT ANALYSIS Conducting a SWOT analysis is the first step in the strategic-planning process. SWOT is an acronym that stands for Strengths, Weaknesses, Opportunities, and Threats. A SWOT analysis is an organized way to look at your business’s strengths, weaknesses, opportunities, and threats.

It is an important part of the strategic-planning process because it helps you zero in on the key issues to keep in mind when formulating your next marketing move. 1. Smart marketers know that the best marketing strategy is one that: a. Emphasizes their companies’ strengths b. Minimizes their companies’ weaknesses c. Capitalizes on good opportunities d. Avoids external threats

One of the benefits of conducting a SWOT analysis is that it provides a filter for a great deal of information. If you can’t categorize pieces of information as strengths, weaknesses, opportunities, or threats, you’ll end up confused and frustrated.

STRENGTH Any resource or capability your business has that can help you gain a competitive advantage in your industry For Example: A company may ask where are we making money?

WEAKNESS Any limitation or shortcoming your business has that can keep you from achieving your objectives. For Example: A company will ask, what resources do we lack?

OPPORTUNITY Any favorable situation in the environment surrounding your business. For example: A new demographic of customers moving into your area is an opportunity.

THREAT A threat is any unfavorable situation in the environment surrounding your business. For Example: New growing government regulations, such as N.C. House Bill 2. competition moving into area is a threat.

WHO’S INVOLVED IN SWOT? The most crucial part of the SWOT analysis involves where you get your information. The methods you use to conduct your SWOT analysis will greatly affect the quality and reliability of the final outcome. It’s important to talk to top executives and employees at every level, as well as customers and suppliers.

WHEN TO CONDUCT A SWOT SWOT analysis helpful when you have a limited amount of time. SWOT is a relatively quick way to get to the heart of the matter when it comes to strategic planning. A simple SWOT analysis can help you organize vital information in a way that makes your top priorities more clear.

Before beginning SWOT analysis Take some time to establish your objectives and goals. 1. What do you hope to achieve by conducting this analysis?

Scope of the SWOT analysis. Example: a. Kraft Foods has separate divisions for beverages, groceries, snacks, cheese and dairy, and convenient meals. b. A SWOT analysis might apply to the whole company, or perhaps just to cheese and dairy. c. Either way, it’s best to know from the start.

Remember those key contributors you identified earlier—the presidents, partners, employees, customers, and suppliers? B. After you’ve determined the goals and objectives of your SWOT analysis, it’s time to start interviewing them!

Conducting Interviews One-on-one SWOT interviews work best because you can give the interviewee your full attention. People will also feel more free to share information if they don’t have to do so in front of a small or large group. In-person interviews are always more effective than telephone interviews.

Weaknesses

Areas in need of improvement are potential weaknesses. Determine Weakness? “What can we improve?” is an appropriate question for determining weaknesses. Areas in need of improvement are potential weaknesses.

When conducting SWOT analysis, consider strengths and weaknesses in relation to the competition. If you and your competitors share the same strength, perhaps it is actually an industry standard. It is not necessary to consider strengths and weaknesses in relation to your business’s past or future, or your business’s opportunities.

Mistakes VS. Weaknesses It’s important not to confuse weaknesses with mistakes. No business is perfect. One mistake does not constitute a weakness, but making the same mistakes over and over is certainly a cause for concern.

Environmental scanning An effective method for gathering external information for use in a SWOT analysis is environmental scanning. Environmental scanning includes information about competition Threats opportunities

How To Determine Threats “What obstacles do we face?” is an appropriate question for determining threats. Obstacles in a business’s path pose threats to the business.

The SWOT matrix After you collect all your SWOT data through your interviews (as well as from yourself!), it’s time to organize it in a way that makes it easy to understand. SWOT analysis is subjective because it deals in large part with opinion.

Remember, the end result of your SWOT analysis should be the ability to make sound strategic- planning decisions. Take a look at the data you’ve collected for each category. 1. What information seems to stick out? 2. Did a certain strength, weakness, opportunity, or threat get mentioned over and over again?

After you’ve organized the collected data in the SWOT matrix, will be better able to evaluate it for the purpose of strategic planning.

Strategic-Planning S-T - strategies focus on strengths to overcome threats. S-O - strategies focus on opportunities that match with the strengths.

Strategic-Planning W-O strategies focus on overcoming a weaknesses to pursue opportunities. W-T strategies that weaknesses don’t make vulnerable to the threats