As with any business, it’s the duty of a business owner or assigned business manager to competently and adequately guide their company through to the initially intended achievements of the company goals and benchmarks from day one. These practices must continue throughout the life of the business. After all, any business requires constant monetary and sweat equity that no one wants to see squandered.
To avoid adverse outcomes, it not only requires the active creation of a company mission and strategic plan of action for the business but will also require a non-stop, vigilant monitoring of the operational performance of your business on all levels. Any consulting professional would strongly recommend that whatever successful strategies that the company creates continue to be frequently performed. Some of the most exceptional consultants associated with some of the most respected business consulting firms suggest that small businesses consider educating themselves with the use of the SWOT/TOWS Matrix.
A Brief History
The SWOT analysis was created in the 1960s by management consultant Albert Humphrey while he was working with the Stanford Research Institute. During that period; many Fortune 500 companies had struggled with their strategic planning efforts and were in need of new, more innovative strategies that would produce planning that would be reasonably executable and effective, long-term. For decades, since the SWOT Analysis was devised and implemented, it’s been regularly and successfully used globally by small to midsize businesses and large corporations alike. It assists in the development of their respective strategies and solutions so that they may continue to experience positive results about their profitability and brand enhancement (among other aspects of the business).
Over time Heinz Weihrich; a professor and management consultant of Global Management and Behavioral Science with The University of San Francisco, developed the TOWS Matrix.
These strategies are not only used by Universities globally to monitor their own business performance, but they teach these strategies early in the educational process to those students who are positioning themselves in all aspects of business management and administration. Today, technology allows small business owners the opportunity to educate themselves in the implementation of these analyses. As a point of fact, there are many useful SWOT/TOWS forms and tools made available to anyone who may like to conduct this research on their businesses.
These same analyses are implemented by company “thought leaders” in not only keeping businesses on a positive path, but they often use the same analyses to help employees come to know themselves within the business environment and how important their thoughts and ideas are to the business no matter the size of the company.
The SWOT and TOWS analyses will create a space for productive “brainstorming”. Once the issues begin to reveal themselves throughout the process, solutions become more accessible to identify. The analyses are a great starting point in maintaining continued growth on all levels. If these steps are taken from the inception of the business, it’s much easier to remain abreast of any possible threats that your company may face. However, these analyses may be performed at any time in the life of the business to improve the business’s strategies.
With proper observation and implementation of correctional strategies, external threats may quickly reveal executable solutions that could stave off and often eliminate the possible damaging results that could be catastrophic to your small business if they are ignored or left to work themselves out. Instead, these analyses are capable of helping to create much-desired success.
What Exactly Does SWOT Stand For?
This acronym represents:
What is TOWS?
Of course, the first thing you’ll notice is that it’s the same acronym, but it’s backward. Why should you use both models? Very basically, by combining the matrices, your company will experience a better opportunity to identify all aspects both internally and externally, not the order of benefits of only one model or the other. SWOT addresses internal information and TOWS addresses more of the external possibilities. Both valuable and needed.
What are the Benefits of Conducting the SWOT/STOWS Analyses for Small Business?
- You will discover the internal strengths and external opportunities available to your company and how strengths may be utilized to benefit from the realization of external opportunities.
- You will benefit from the discovery of internal strengths and external threats and how your business may benefit from their own strengths so that your company may avoid any potential external threats that have come to light.
- You will discover how to use your opportunities and overcome any internal weaknesses.
- You will identify your abilities to minimize any weaknesses and will, therefore, acquire the capacity to avoid potential threats.
- None of this will be remotely effective, however, if the issues uncovered during your discovery phases lie dormant as you continue to run your company as you have been running it. The changes will not occur on their own. Over time external progression will ultimately introduce threats that you won’t see coming and those threats will compound with time.
Don’t ignore your discoveries once you’ve answered your questions about how to improve your business. Your weaknesses and threats will not go away on their own, however; your opportunities just may. Alternatively, your company, as you progress, could well become a threat to other companies. You will want to maintain focus and anticipate what possible strategies they may devise to combat the threats that you could pose and prepare to remain a step ahead.
In an extremely brief summation; after performing the SWOT/TOWS analysis, you’ll be left with a list of awareness’s, self-imposed questions and potential solutions to threats both internally and externally. It will be then that you will have the ability to either change the trajectory of specific aspects of your company or the company as a whole if needed. Or you will have the ability to identify opportunities and improve on whatever is already successful.
Should you find that you are overwhelmed, and in need guidance, you should consider working with a reputable business consultant or business consulting firm for assistance.
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: