What is a SWOT Analysis? SWOT is an acronym for Strengths, Weaknesses, Opportunities, and Threats. The analysis utilizes these headings in a quadrant format (Fig. 1) to list core competencies and other relevant company traits and characteristics. It’s a visual tool to help you see how the company is currently positioned and provides insight on what areas the company should be addressing in the near the future. To maximize the benefit of a SWOT Analysis, you also need to try and understand how your customers, competitors and the market view your company.
It also serves as the baseline for developing a strategic plan. Below are examples of the types of questions that need to be asked when preparing a SWOT Analysis and building a strategic plan.
- What are the company’s core competencies?
- How do we make use of them to our advantage in the market?
- What are our customer’s expectations? Are we meeting those expectations? If not, what should we be doing?
- Are we covering all applicable market segments?
- What new services or products should we be offering?
- Are there new customers or markets we are not covering?
- What changes need to be made to improve margins and or overall profitability?
- Is our technology current?
- Are we as cost-effective as we should be?
- Are innovations on the horizon that could have a detrimental effect on our business?
Additionally, this methodology can and should also be used on a departmental basis. It can help identify and establish continual improvement process requirements as well as increase overall efficiency.
Lastly, you should complete a SWOT Analysis for all your primary competitors. Knowing and understanding the competition is one of the best available to assist you in defining your strategic plans.
At Cogent Analytics, we never stop looking for ways to improve your business and neither should you. So, check out some of our other posts for helpful business information: