How do swot analysis

Just capture the factors you believe are relevant in each of the four areas. Once you are finished brainstorming, create a final, prioritized version of your SWOT analysis, listing the factors in each category in order of highest priority at the top to lowest priority at the bottom. There are certainly other questions you could ask; these are just meant to get you started.

Strengths describe the positive attributes, tangible and intangible, internal to your organization. They are within your control. Weaknesses are aspects of your business that detract from the value you offer or place you at a competitive disadvantage. You need to enhance these areas in order to compete with your best competitor. Opportunities are external attractive factors that represent reasons your business is likely to prosper.

Threats include external factors beyond your control that could place your strategy, or the business itself, at risk. You have no control over these, but you may benefit by having contingency plans to address them if they should occur. Once you have identified and prioritized your SWOT results, you can use them to develop short-term and long-term strategies for your business.

After all, the true value of this exercise is in using the results to maximize the positive influences on your business and minimize the negative ones. But how do you turn your SWOT results into strategies? This is sometimes called a TOWS analysis. For example, look at the strengths you identified, and then come up with ways to use those strengths to maximize the opportunities these are strength-opportunity strategies.

Then, look at how those same strengths can be used to minimize the threats you identified these are strength-threats strategies. Continuing this process, use the opportunities you identified to develop strategies that will minimize the weaknesses weakness-opportunity strategies or avoid the threats weakness-threats strategies.

The following table might help you organize the strategies in each area:. Follow him on Twitter Timberry. Read Managing By: Tim Berry. What is a SWOT analysis? Strengths internal, positive factors Strengths describe the positive attributes, tangible and intangible, internal to your organization.

What do you do well? What internal resources do you have? When you have completed the steps above, you will have 4 separate lists. Ideally, these lists can be displayed side-by-side so you can have an overall picture of how your business is running and what issues you need to address. You can then work out what issues are the most important and what can be dealt with later i. Once you have answered these questions and finalised your lists, you can now use the SWOT analysis to develop strategies for achieving your business goals.

General enquiries: 13 QGOV 13 74 Market and customer research. Use the following 8 steps to conduct a SWOT analysis. Research your business, industry and market Before you begin the SWOT analysis you need to do some research to understand your business, industry and market. List your business's strengths The first step is to identify and list what you think are your business's strengths.

List your business's weaknesses List things in your business that you consider to be weaknesses i. List potential opportunities for your business Think about the possible external opportunities for your business. List potential threats to your business List external factors that could be a threat or cause a problem for your business.

Establish priorities from the SWOT When you have completed the steps above, you will have 4 separate lists. Develop a strategy to address issues in the SWOT Review your 4 prioritised lists by asking: How can we use our strengths to take advantage of the opportunities identified? How can we use these strengths to overcome the threats identified? What do we need to do to overcome the identified weaknesses in order to take advantage of the opportunities?

How will we minimise our weaknesses to overcome the identified threats? Also consider For example, a hedge fund may have developed a proprietary trading strategy that returns market-beating results.

It must then decide how to use those results to attract new investors. Weaknesses stop an organization from performing at its optimum level. They are areas where the business needs to improve to remain competitive: a weak brand, higher-than-average turnover, high levels of debt, an inadequate supply chain, or lack of capital. Opportunities refer to favorable external factors that could give an organization a competitive advantage.

For example, if a country cuts tariffs, a car manufacturer can export its cars into a new market, increasing sales and market share.

Threats refer to factors that have the potential to harm an organization. For example, a drought is a threat to a wheat-producing company, as it may destroy or reduce the crop yield. Other common threats include things like rising costs for materials, increasing competition, tight labor supply.

What occurs within the company serves as a great source of information for the strengths and weaknesses categories of the SWOT analysis.

Examples of internal factors include financial and human resources, tangible and intangible brand name assets, and operational efficiencies. Potential questions to list internal factors are:. What happens outside of the company is equally as important to the success of a company as internal factors. External influences, such as monetary policies, market changes, and access to suppliers, are categories to pull from to create a list of opportunities and weaknesses.

Potential questions to list external factors are:. Use a SWOT analysis to identify challenges affecting your business and opportunities that can enhance it. However, note that it is one of many techniques, not a prescription. However, it also noted weaknesses and threats such as foreign currency fluctuations, growing public interest in "healthy" beverages, and competition from healthy beverage providers.

Its SWOT analysis prompted Value Line to pose some tough questions about Coca-Cola's strategy, but also to note that the company "will probably remain a top-tier beverage provider" that offered conservative investors "a reliable source of income and a bit of capital gains exposure. To get a better picture of a SWOT analysis, consider the example of a fictitious organic smoothie company.

To better understand how it competes within the smoothie market and what it can do better, it conducted a SWOT analysis. Through this analysis, it identified that its strengths were good sourcing of ingredients, personalized customer service, and a strong relationship with suppliers. Peering within its operations, it identified a few areas of weakness: little product diversification, high turnover rates, and outdated equipment. Examining how the external environment affects its business, it identified opportunities in emerging technology, untapped demographics, and a culture shift towards healthy living.

It also found threats, such as a winter freeze damaging crops, a global pandemic, and kinks in the supply chain. In conjunction with other planning techniques, the company used the SWOT analysis to leverage its strengths and external opportunities to eliminate threats and strengthen areas where it is weak.

SWOT strengths, weaknesses, opportunities, and threats analysis is a method for identifying and analyzing internal strengths and weaknesses and external opportunities and threats that shape current and future operations and help develop strategic goals. SWOT analyses are not limited to companies. Individuals can also use SWOT analysis to engage in constructive introspection and form personal improvement goals. Home Depot conducted a SWOT analysis, creating a balanced list of its internal advantages and disadvantages and external factors threatening its market position and growth strategy.

High-quality customer service, strong brand recognition, and positive relationships with suppliers were some of its notable strengths; whereas, a constricted supply chain, interdependence on the U.

Closely related to its weaknesses, Home Depot's threats were the presence of close rivals, available substitutes, and the condition of the U. It found from this study and other analysis that expanding its supply chain and global footprint would be key to its growth. Creating a SWOT analysis involves identifying and analyzing the strengths, weaknesses, opportunities, and threats of a company. It is recommended to first create a list of questions to answer for each element.

The questions serve as a guide for completing the SWOT analysis and creating a balanced list. The SWOT framework can be constructed in list format, as free text, or, most commonly, as a 4-cell table, with quadrants dedicated to each element.

Strengths and weaknesses are listed first, followed by opportunities and threats. Threats are external forces that may adversely affect the success of a company. They consist of competitive advantages of rivals, uncontrollable influences such as natural disasters, governmental policies, and more. Identifying threats can help expose barriers to success and position companies to develop strategies to overcome them.

Strengths in a SWOT analysis are the favorable internal activities, processes, and behaviors of a company what a company does well. These are the factors that contribute to the success of the company and its brand. Strengths, such as highly-rated customer service and effective supply chain management, help companies sustain and enhance their competitive advantage. A SWOT analysis is a great way to guide business-strategy meetings. It's powerful to have everyone in the room discuss the company's core strengths and weaknesses, define the opportunities and threats, and brainstorm ideas.