Why Should Every Business Carry Out SWOT Analysis? | Global Business Consultants );

KC Ling | GBC Strategist | 2 min read | Aug 2019

 

SWOT analysis involves more than making four lists. The two most important parts of SWOT analysis are drawing conclusions from the SWOT listings about your company’s overall situation and translating these conclusions into strategic actions to better match your company’s strategy to its internal strengths and market opportunities, to correct important weaknesses, and to defend against external threats.

Just what story the SWOT listings tell about your company’s overall situation is often revealed in the answers to the following set of questions:

  • What are the attract aspects of your company’s situation?
  • What aspects are of the most concern?
    Are your company’s internal strengths and competitive assets sufficiently strong to enable it to compete successfully?
  • Are your company’s weaknesses and competitive deficiencies of small consequences and readily correctable, or could they prove fatal if not remedied soon?
  • Do your company’s strengths outweigh its weaknesses by an attractive margin?
  • Does your company have attractive market opportunities that are well suited to its internal strengths? Does the company lack the competitive assets to pursue the most attractive opportunities?
  • All things considered, where on a scale of 1 to 10 (where 1 in alarmingly weak and 10 is exceptionally strong) do your company’s overall situation and future prospects rank?

The final piece of SWOT analysis is to translate the diagnosis of your company’s situation into actions for improving your company’s strategy and business prospects. Your company’s internal strengths should always serve as the basis of its strategy, placing heavy reliance on your company’s best competitive assets is the soundest route to attracting customers and competing successfully against rivals. As a rule, strategies that place heavy demands on areas where your company is weakest or has unproven competencies should be avoided. Plainly, managers must look toward correcting competitive weaknesses that make your company vulnerable, hold down profitability, or disqualify it from pursuing an attractive opportunity. Furthermore, your company’s strategy should be aimed squarely at capturing those market opportunities that are most attractive and suited to your company’s collection of capabilities. How much attention to devote to defending against external threats to your company’s future performance hinges on how vulnerable your company is, whether defensive moves can be taken to lessen their impact, and whether the costs of undertaking such moves represent the best use of company resources.

 

Hope you enjoyed this short thought-leadership piece. Must love…from GBC.

 

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