S.W.O.T analysis is one of the bets tools a business can use to look at all aspects of its operations. This article explains how it is used and what it shows.
Things You Will Need
* A Business
* Market research
* Sales Figures
The first step when using swot analysis is to determine a goal or objective which you want to achieve. This can either be personal, and focused on individual people, or can be for the business as a whole. From here you can identify areas that need improvement and make changes more easily.
The strengths of any business can be very varied, but are generally either things that the business is good at, or assets which they have.
For example a performance based strength might be that your business has a very low amount of waste in its production process. An asset based strength might be ownership of successful brands, or patented products. An example of a patented product would be cameras that instantly print the picture.
Similarly to strengths, weaknesses can be divided into tangibles and intangibles.
A tangible weakness might be that efficiency of production is low, or that the business has bad suppliers of their raw materials. An intangible weakness might be that the business lacks brand recognition, or that competition offer patented and unique products. An example of lack of brand recognition might be a business who makes products for another business to sell on with their own label.
Perhaps the most difficult category to always get right is opportunities that the business has. The reason being that not all opportunities always work out in the end.
Opportunities to the business might be things such as new technology being available which can aid the business somehow or law changes which favor the business. An example of new beneficial technology would be the use of the internet for internal communications.
Unlike weaknesses, threats are from outside the business, and are things which the business has no influence over directly.
Threats might be things such as changes in consumer taste, alternative products emerging on the market, or new competition entering the market. An example of the latter would be supermarkets entering the insurance business.
Having compiled all of your businesses SWOT points, the last thing to do is to take action to reduce threats and weaknesses. This might be through the introduction or development of new products, or simply by monitoring the market trends and competition.