What is a SWOT analysis?
A SWOT analysis, also known as a strength weakness analysis, literally stands for:
Strengths
Weaknesses
Opportunities
Threats
It's a framework for analyzing an organisation's strengths, weaknesses, market opportunities and threats. It allows you to identify where new opportunities and possibilities lie for your organisation and how to approach them based on your strengths and weaknesses. A SWOT analysis is often part of a business plan or a marketing plan. But you can just as easily apply it to other areas, such as your own career.
How do I apply a SWOT analysis?
Now that you know what a SWOT analysis is, you're probably curious on how to actually apply it to your own situation! It's important to distinguish two parts: the internal analysis and the external analysis, being the market analysis.
Internal analysis
First, you make an analysis of your own organisation, or your own career. This means you don't include any external influences. You only look at the elements that you yourself can have an impact on. Are you having trouble identifying these points for yourself? Take a look at your competitors and consider where you are performing better or worse.
Strengths
This covers your organisation's strengths, or if you apply a SWOT analysis for yourself, your own strengths. Some examples are: Extensive market knowledge, expertise within the field, a good reputation or customer satisfaction. Points in which you excel and perform above average.
Weaknesses
These are the areas where you score below average. It could be both deliberate and unintentional. For example, perhaps you have chosen to invest in knowledge and expertise, as opposed to investing in service. As a result, customer friendliness scores lower. Another example of a weakness could be high costs. Again, it's important that these weaknesses are about internal factors and not external influences.
External analysis
Next, take a look beyond your own organisation, or own situation. What opportunities and threats exist in the market? These are things that may apply to all organisations, or that would also be there if your organisation didn't exist. Some examples are: the financial market, marketing trends, political developments, you name it.
Opportunities
Which new opportunities do you see, both short and long term? Think about changes in the market or new technological developments that will make your product or service even more attractive to consumers. Are you making the SWOT analysis for yourself? Then perhaps there are new training opportunities or tools that could make you even better at your job.
Threats
What external factors pose a threat to your organisation now, or could become threats in the future? These could be changes in laws and regulations, the economic situation or new developments that put your product or service in a weaker position in the market.
Tips
- To create the most accurate assessment of your organisation, it's best to involve people from different teams as well as outsiders when making a SWOT analysis. By doing so, you'll avoid tunnel vision.
- Try to choose approximately three items for each section, keeping the target group's perspective in mind.
Make sure not to work in general terms, be specific. For example, do not put "new developments" under threats, but rather " new development X makes Y possible and that could have influence Z on us". - Do you want to take the SWOT analysis one step further? Use it to create a confrontation matrix. Place your main strengths and weaknesses opposite your company's opportunities and threats. Next, look at what effect those strengths and weaknesses have on the opportunities and threats.
- While making a SWOT analysis, reflect on both the current situation and the future. Furthermore, while making the external analysis, it's beneficial to consider opportunities and threats at both the meso-level (the whole industry) and macro-level (the whole market).
In conclusion, making a SWOT analysis can offer new insights into an organisation's operations and current strategies, as well as into your own career. We definitely recommend giving it a try, who knows what new insights you can get out of it!