What’s the best way to make an informed, analytical decision about the future of your business — whether it’s to open a new service line, hire new employees, or make some other significant change?
One of the most useful tools for methodical decision-making is the SWOT analysis grid. In previous installments of this series, I defined the value of the SWOT tool, and also delved into the specifics of the first two components: strengths and weaknesses.
Today, we’ll consider the second half of the equation. In addition to surveying your business’s internal strengths and weaknesses, it’s also important to take opportunities and threats into account.
A key distinction
There’s an important distinction to be made between the strengths and weaknesses columns and opportunities and threats.
Simply put, strengths and weaknesses refer to things that are innate, intrinsic to your business — things that are under your control. When we talk about opportunities and threats, however, we’re referencing external market forces that could spell real promise or real danger for your company. By definition, opportunities and threats are at least somewhat beyond your control, yet they are still things you can be aware of, plan for and potentially seek to exploit in an advantageous way.
Assessing business opportunities
In considering business opportunities, the goal is to reflect on external factors that might give your business a competitive edge.
To properly assess your business opportunities, ask questions such as these:
- Are there underserved areas in your market? For example, are there services you could be offering that your competitors aren’t, or areas where it seems like your competitors are struggling?
- Are there any emerging needs for products or services that you offer? Are there economic, cultural, aesthetic or environmental trends that could play to your strengths?
- Has your company gotten favorable reviews or news coverage that you could capitalize on?
By answering questions like these, you may identify some areas to boost sales or improve business growth.
Assessing threats to your business
The flip side of the coin is business threats. A threat could be any external element that poses a risk to the company itself or to your chances for business growth.
To think about business threats, try asking questions like these:
- Do you have any new or emerging competitors in the area?
- Have there been any unfavorable changes to industry regulations or local laws?
- Has your company or your industry been on the receiving end of negative press coverage or a downshift in public opinion?
- Have customer attitudes toward your company changed for any reason?
- Have economic trends made customers less likely to spend money on the products and services you offer?
By considering each element in the SWOT grid, you can get a panoramic picture of where your company stands, and where you might look for sales and growth. A good SWOT analysis should point you toward areas where your business is doing well, and where you can double down; and to areas where you need to be cautious, or make some changes.
Use the SWOT grid to ensure you’re considering your next big business decision from all vantage points.
About the author
Amanda Clark is the president and editor-in-chief of Grammar Chic, a full-service professional writing company. She is a published ghostwriter and editor, and she's currently under contract with literary agencies in Malibu, California, and Dublin. Since founding Grammar Chic in 2008, Clark, along with her team of skilled professional writers, has offered expertise to clients in the creative, business and academic fields. The company accepts a wide range of projects; often engages in content and social media marketing; and drafts resumes, press releases, web content, marketing materials and ghostwritten creative pieces. Contact Clark at www.grammarchic.net.
