How can SWOT analysis help my business grow?
“I want to move my business to the next level, but don’t know what to do. I feel isolated; I keep hearing about strategic business and marketing planning, but don’t really know what they are….”
To introduce you to strategic planning let’s take a look at your strengths, weaknesses, opportunities and threats, commonly known as a SWOT analysis. This is the process by which you will learn to dig deeper into your business, enabling you to grow in a steady and risk free way.
A SWOT analysis is a thinking tool and, if used properly, will save you time and money over the medium to long term and will most certainly help you to break through to the next level.
To be really effective, you need to have your Vision clearly defined and to have identified the three top (core) objectives you need to achieve on that journey toward your Vision.
Performing a SWOT analysis on your core objectives will enable you to drill down to greater detail, understand the exact make-up of each of your objectives and give you the best route to success.
The exercises below will provide you with some of the most common examples of Strengths, Weaknesses, Opportunities and Threats, as they are viewed in terms of a business rather than the individuals within it. There are always, however some that may relate to individuals or team member roles; the important thing in this chapter is to remove the blinkers and think about your own business objectives with a completely open mind
From a maximised effectiveness perspective a SWOT analysis will always be much better if performed by a team; in which case the team must be briefed on the vision and core objectives and encouraged to leave all baggage behind when they enter the SWOT room!
Origin of strength: Internal, organisational.
- Good working capital and cash rich
- Good leadership
- Well trained management team
- Well trained staff
- All major processes are mapped out and systemised
- Products have a WOW factor
- The business can be scaled up
- We exceed our customers’ expectations every time
Origin of weakness – Internal, Organisational
- Poor customer complaint procedure
- Poor customer experience when dealing with the business
- Roles and responsibilities are not clear and defined
- Target audience is not clear and defined
- Poor marketing message giving poor marketing results
- Customer database not kept up to date and not used for marketing
- Poor productivity; too much time wasting
- Poor staff retention
- Poor direction from the management team
Origin of opportunity – External, market driven.
- Our products are unique in the market INTERNAL (STRENGTH)
- Our customer service exceeds that of competitors
- There is a gap in the market
- There are several niche markets for our products
- Our main competitor’s deliveries are poor due to machinery breakdowns
- New e-commerce and SEO changes will give us access to new clients
- Affiliate marketing programme provides exposure to new market
- Market analysis suggests client value quality and customer service (where we excel)
Origin of threat – External, market driven.
- Sales have fallen due to external influences
- Customer attrition
- Competitor targeting our key sales people
- New competitor products with higher specs
- Rapid market changes in our most established areas
- Increased competition is squeezing margins
- We compete on price (commodity market)
- Market demands faster delivery on promises
- Bank funding difficult – we are undercapitalised and cash flow is poor.
Nine Key Elements
Whilst we advocate initial SWOT analysis to be performed on your overall Business Vision and Core Objectives, this is just the first of our recommended nine key elements of business, that should regularly have a SWOT analysis performed. The others are:
1. Core Objectives
2. Business Idea & Model
3. Products & Services
4. Lead generation system
5. Lead conversion system
6. Operational plan
7. Financial plan
8. Organisational structure
- 1. Carry out a SWOT analysis with your team and then as the questions below:
- 2. “How can we capitalise on our strengths?”
- 3. “How can we develop our weaknesses into strengths?”
- 4. “How can we exploit and benefit from each opportunity?”
- 5. “How can we mitigate each threat?