SWOT ANALYSIS T00L

SWOT is an acronym for Strengths, Weaknesses, Opportunities, and Threats. It is a planning tool used to understand the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business. It involves specifying the objective of the business or project and identifying the internal and external factors that are supportive or unfavourable to achieving that objective. SWOT is often used as part of a strategic planning process.
What makes SWOT particularly powerful is that, with a little thought, it can help you uncover opportunities that you are well placed to exploit. And by understanding the weaknesses of your business, you can manage and eliminate threats that would otherwise catch you unawares.
More than this, by looking at yourself and your competitors using the SWOT framework, you can start to craft a strategy that helps you distinguish yourself from your competitors, so that you can compete successfully in your market.
A strength may be something that the enterprise does well, or an asset, skill, or network of contacts employed. In addition, strengths can be anything that is "going well" for the enterprise, including core competencies.
A weakness is the opposite of strength, something that is not performed as well as necessary or that is not going well, at all. It may be something which is lacking or missing from the organization.
An opportunity is an identified chance to exploit a strength and to pursue a strategy to benefit the performance of the enterprise.
PURPOSEThe purpose of SWOT analysis technique is to highlight and differentiate the strategic gaps or barriers that may block achievement of the enterprise’s current explicit vision and the future working vision. It is also to brainstorm possible activities/opportunities for redesign.
BENEFITSThe benefit of using SWOT analysis technique is that it provides a structured and objective means for identifying, differentiating and weighing the strategic strengths and weaknesses, opportunities and threats that face the enterprise.

HOW TO USE THE TOOL:
To carry out a SWOT Analysis, write down answers to the following questions:
Strengths:
What advantages does you or your organization have?
What do you do better than anyone else?
What unique or lowest-cost resources do you have access to?
What do people in your market see as your strengths?
What factors mean that you "get the sale"?
Be realistic: It's far too easy to fall prey to "not invented here syndrome". (If you are having any difficulty with this, try writing down a list of your characteristics. Some of these will hopefully be strengths!) In looking at your strengths, think about them in relation to your competitors Weaknesses:
What could you improve?
What should you avoid?
What are people in your market likely to see as weaknesses?
What factors lose you sales?
Again, consider this from an internal and external basis: Do other people seem to perceive weaknesses that you do not see? Are your competitors doing any better than you? It is best to be realistic now, and face any unpleasant truths as soon as possible.
Opportunities:
Where are the good opportunities facing you?
What are the interesting trends you are aware of?
Useful opportunities can come from such things as:
Changes in technology and markets on both a broad and narrow scale
Changes in government policy related to your field
Changes in social patterns, population profiles, lifestyle changes, etc.
Local events
A useful approach for looking at opportunities is to look at your strengths and ask yourself whether these open up any opportunities.
Alternatively, look at your weaknesses and ask yourself whether you could create opportunities by eliminating them.
Threats:
What obstacles do you face?
What is your competition doing that you should be worried about?
Are the required specifications for your job, products or services changing?
Is changing technology threatening your position?
Do you have bad debt or cash-flow problems?
Could any of your weaknesses seriously threaten your business?
Carrying out this analysis will often be illuminating - both in terms of pointing out what needs to be done, and in putting problems into perspective.
Strengths and weaknesses are often internal to your organization. Opportunities and threats often relate to external factors. For this reason the SWOT Analysis is sometimes called Internal-External Analysis and the SWOT Matrix is sometimes called an IE Matrix Analysis Tool.
Strengths and Opportunities
One or more strengths. A strength suggests one or more opportunities.
An opportunity exploits
An opportunity is pursued by at least one strategy.
An opportunity may require information technology support, building on the IT strengths of the enterprise.
Weaknesses and Threats:
A weakness poses one or more threats.
A threat may be posed by one or more weaknesses.
A threat should be addressed by at least one strategy.
A threat may be avoided by employing information technology support.
Example:
A start-up small consultancy business might draw up the following SWOT matrix:
Strengths:
We can respond very quickly as we have no red tape, no need for higher management approval, etc.
We can give really good customer care, as the current small amount of work means we have plenty of time to devote to customers
Our lead consultant has strong reputation within the market
We can change direction quickly if our approach isn't working
We have little overhead, so can offer good value to customers.
Weaknesses:
Our company has no market presence or reputation
We have a small staff with a shallow skills base in many areas
We are vulnerable to vital staff being sick, leaving, etc.
Our cash flow will be unreliable in the early stages
Opportunities:
Our business sector is expanding, with many future opportunities for success
Our local council wants to encourage local businesses with work where possible
Our competitors may be slow to adopt new technologies
Threats:
Will developments in technology change this market beyond our ability to adapt?
A small change in focus of a large competitor might wipe out any market position we achieve.
The consultancy may therefore decide to specialize in rapid response, good value services to local businesses. Marketing would be in selected local publications, to get the greatest possible market presence for a set advertising budget. The consultancy should keep up-to-date with changes in technology where possible.
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