Have you ever done a SWOT analysis and thought So-What? How does it help me? What does it mean?
The trouble with most SWOT analyses is that they produce lists of Strengths, Weaknesses, Opportunities and Threats which by themselves are not particularly useful. Taking the analysis one stage further can turn your SWOT analysis into a powerful tool.
A strategic SWOT analysis can help produce strategies that can leverage opportunities and play to your strengths while reducing weaknesses and threats to your business. This is a simple process and here is how to do it:
1 Draw a blank matrix with like the one below then use the top and left hand side boxes to record your Strengths, Weaknesses, Opportunities and Threats. The strengths and weaknesses should relate to internal issues and the opportunities and threats should relate to the environment outside your business.
2 Identify four or five strengths (what’s great about your idea or what you do well?).
3 Identify four or five Weaknesses (what you do badly or are lacking?).
4 Identify four or five Opportunities (where and what are they?).
5 Identify four or five Threats (what could go wrong?).
6 Carefully examine the strengths and opportunities and ask yourself “How can I use these strengths to build on or commercialise these opportunities?” Write down the ideas (strategies) in the large central box.
7 Follow a similar process to answer the following three questions (and write the answers in the large central box):
"How can I use strengths to overcome threats?" "How can I prevent weaknesses from spoiling opportunities?" "How can I prevent weaknesses combining with threats?"
8 Take the best ideas and develop them as strategies for your business.
The Strategic SWOT is a great way of pulling your idea apart to identify hidden potential in your business. It may help you work out what changes you need to do to make your idea/objective/goal happen. What strategies combine your strengths and opportunities to overcome your weaknesses and threats? Look for new markets, new processes, new people and even new core values.
Note that the value of the Strategic SWOT analysis is very much dependent on the quality of the SWOT items. Be realistic and brutally honest. Try to work it out from all viewpoints. If you are not honest with your identification, you will not get honest strategies.
Give it a go to identify some hidden potential in your business then unlock that potential by putting some actions together using a one page plan.