Ah, the SWOT analysis. The starting point for every agency and consultancy when working with a client, and the best way to show how much of a strategic partner they are.
The SWOT is simple. It’s clichéd. It’s not remotely unique to anyone. And yet… I still think it’s a vital part of any strategic planning.
It’s also wildly misunderstood.
The 4 letters in SWOT give the impression that it’s a review of 4 distinct things. After all, that’s what acronyms are usually for… to help us group together and remember related but distinct ideas. But when it comes to the SWOT, it’s not 4 distinct ideas. It’s 4 different ways of looking at the same thing, like a 4-sided dice.
SWOT is another way of saying: What’s working and not working today? What’s likely to work or not work tomorrow?
| | Works | Doesn't Work |
|----------|---------------|--------------|
| Today | Strengths | Weaknesses |
| Tomorrow | Opportunities | Threats |
That’s all it is. Entire books have been written about SWOT. Countless presentations have been given about it. But it’s actually incredibly simple: What works, what doesn’t work, today, and tomorrow.
Or: What’s good and bad, now and later.
So, that’s the simplicity of SWOT. Now that we’ve simplified it and can see it clearly for what it is, let’s expand on this understanding. What questions should you be asking yourself to best discover your strengths, weaknesses, opportunities, and threats?
Strengths: 10 Questions to Discover What’s Working Today
Be honest with yourself. Don’t inflate your own ego. Don’t blow smoke up your own ass. Use the questions below to help explore your strengths, but don’t make the mistake of convincing yourself a strength exists where it does not. The SWOT analysis is for YOUR benefit. It’s not here to impress anyone else. So lying about your strengths here is just lying to yourself.
That being said, don’t hold back, either. Be clear about what your real strengths are, because they’re the foundation upon which you’re going to build your empire.
Core Competencies: What does our company do better than our competitors? What are we most recognized for?
Resources: Do we have any unique resources (e.g., talent, technology, intellectual property) that our competitors lack?
Financial Health: Are our financial ratios (e.g., profitability, liquidity, solvency) stronger than industry averages?
Operational Efficiency: Do we have processes or systems in place that give us an operational advantage?
Customer Loyalty: Do we have a high rate of customer retention? What do our customers consistently praise us for?
Brand Reputation: How strong and positive is our brand recognition in the market?
Innovation: Have we introduced any groundbreaking products, services, or technologies that have reshaped the industry or given us a competitive edge?
Organizational Culture: Do we have a company culture that attracts top talent and promotes high levels of employee satisfaction and retention?
Market Position: Are we a market leader or have significant market share in any specific segments or regions?
Strategic Alliances: Do we have beneficial partnerships or alliances that amplify our strengths or give us access to new markets and resources?
Weaknesses: 10 Questions to Discover What’s NOT Working Today
Uncovering weaknesses may be uncomfortable, but the biggest strength any person can have is the strength to face their weaknesses. Don’t hide from them. Confront them, defeat them, or turn them into strengths of their own.
(Pro tip: Most strengths are weaknesses under the wrong circumstances. Likewise, most weaknesses are actually strengths in the right circumstance. You just need to find the right way to look at it.)
Skill Gaps: Are there areas in our business where we lack expertise or knowledge?
Resource Constraints: Do we face any limitations in terms of financial resources, manpower, or technology?
Operational Challenges: Are there processes within our business that are inefficient or outdated?
Customer Feedback: What are the most common complaints or criticisms we receive from our customers?
Financial Performance: Are there any concerning financial metrics, such as declining revenue, high debt, or decreasing profitability?
Employee Morale and Turnover: Do we have a higher than industry-average turnover rate? Are there signs of low employee morale or satisfaction?
Market Position: Are there areas or segments in the market where our presence is weak or declining?
Adaptability: How well do we adapt to changes in the market, new technologies, or shifts in consumer behavior?
Dependence: Are we overly reliant on a single client, supplier, product, or distribution channel?
Brand Perception: Are there negative perceptions or misconceptions about our brand in the market?
Opportunities: 10 Questions to Discover What Will Work For You Tomorrow
Opportunities, by definition, come from outside yourself. (If they came from within, they’d be a strength.) The world is constantly evolving, and so you should always aim to stay on top of any industry shifts, global events, and market dynamics. Be proactive. Be responsive. Seize the opportunities that present themselves before your competitors do, and gain a competitive edge.
Market Trends: What new trends are emerging in our industry, and how can we capitalize on them?
Unserved Needs: Are there needs or problems of our customers that are currently not being addressed by our products or services?
Technological Advancements: Are there new technologies emerging that we can integrate into our operations or product offerings?
Geographical Expansion: Are there new markets, domestically or internationally, that we haven’t explored but have potential for our products or services?
Partnerships: Are there potential partners or collaborators that could help us enhance our offerings, reach new audiences, or enter new markets?
Diversification: Can we diversify our product or service lineup to cater to a broader audience or to hedge against risks?
Regulatory Changes: Are there upcoming or recent changes in regulations that can be turned to our advantage?
Acquisitions: Are there businesses or startups that we can acquire to enhance our capabilities, enter new segments, or eliminate competition?
Supply Chain: Are there opportunities to streamline our supply chain, work with new suppliers, or adopt more cost-effective materials and methods?
Customer Engagement: How can we further engage with our existing customer base, perhaps through loyalty programs, expanded services, or new communication channels?
Threats: 10 Questions to Discover What WON’T Work For You Tomorrow
Guess what? In business, there’s always someone coming for your lunch. If no one’s coming for you, it just means you don’t have anything worth fighting over. So when you’re discovering and jotting down the threats facing your business, don’t be discouraged. Every successful business faces threats. (Unsuccessful businesses are their own threat.) So sit back, relax, and count all the ways things could go horribly wrong for you in the coming weeks, months, and years.
Competitive Landscape: Who are our emerging competitors? Are there new entrants in the market who are capturing market share?
Technological Disruptions: Are there new technologies that could render our products or processes obsolete?
Regulatory Changes: Are there anticipated changes in regulations or laws that could negatively impact our operations or market position?
Economic Fluctuations: How might economic downturns, recessions, or other macroeconomic factors impact our business?
Supply Chain Vulnerabilities: Are we reliant on single or limited sources for key materials or components? What would happen if these were disrupted?
Cultural and Social Shifts: Are there shifts in consumer behavior, values, or preferences that could adversely affect our products or brand?
Natural Disasters and Climate Change: How could natural disasters, climate change, or other environmental factors impact our operations, supply chain, or demand for our products?
Geopolitical Risks: Are there geopolitical tensions or events in regions critical to our business that could disrupt our operations or markets?
Cybersecurity: How susceptible is our business to cyber threats, data breaches, or other technological vulnerabilities?
Brand Reputation: Are there potential risks or events that could damage our brand reputation or customer trust?