In the business world, the term SWOT analysis stands for strengths, weaknesses, opportunities, and threats. Although it’s a simple tool to use, it can yield powerful insights and results. Businesses can use it to define their start-up strategy or to adjust the direction of their company after uncovering previously unknown issues.
More About Each Letter
The letters S and W in SWOT analysis refer to the strengths and weakness of your own company. These are things you as a business owner or manager can control and adjust if necessary. Some examples include the physical location of your company, hiring or firing certain employees, and deciding to produce a new product line.
The O and W in SWOT analysis that represents opportunities and threats are things that your business has less control over. That is because they take place outside of your company’s walls and have an impact on your specific industry and the larger marketplace. Even though you can’t control opportunities and threats, you can take steps to use them for the advantage of your business. Some typical examples include the price of shipping, cost of raw goods, and current shopping trends among your customers.
Performing a SWOT Analysis
The most effective way to complete this task is to list strengths and weaknesses on one side of the grid and opportunities and threats on the other side. All levels of company leadership should be involved in the process. However, the SWOT analysis will be most effective if it also involves people from customer service, sales, marketing, and other areas with diverse perspectives on how the company serves its customers. Getting input from customers themselves can make this an especially beneficial exercise.
For the best results, plan to complete a SWOT analysis every six to 12 months. If you need further assistance in planning or executing the analysis, don’t hesitate to contact Norus Capital.