Performing a SWOT analysis.IntroductionSWOT analysis SWOT Analysis A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. emerged in the 1960s from research at Stanford Research Institute Stanford Research Institute - Former name of SRI International. into the failure of current corporate planning methods. The technique evolved, became widely used during the 1980s and remains popular, although critics have pointed out weaknesses in its application, including a lack of analytical analytical, analytic pertaining to or emanating from analysis. analytical control control of confounding by analysis of the results of a trial or test. depth. It provides a simple framework for analysing the market position of an organisation and can be applied in a range of planning and strategic contexts including strategy development, marketing planning, and the evaluation of strategic options for a whole business or an individual department. It is also used by individuals to assess personal career prospects, although this aspect is not covered not covered Health care adjective Referring to a procedure, test or other health service to which a policy holder or insurance beneficiary is not entitled under the terms of the policy or payment system–eg, Medicare. Cf Covered. here. National Occupational Standards for Management and Leadership This checklist has relevance for the following standards: B: Providing direction, units 1, 2 Definition SWOT analysis is a tool for strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. which involves the identification and evaluation of Strengths, Weaknesses, Opportunities and Threats. This framework facilitates the assessment of internal capabilities and resources as well as external factors influencing organisational achievement and profitability. The analysis may be carried out by a single manager, but usually involves the participation of a wider group, so that insights can be gained from across the organisation. Action checklist 1. Establish the objectives The first step in any management project is be clear about what you are doing and why. The purpose of conducting a SWOT analysis may be wide or narrow, general or specific--anything from getting staff to think about and understand the business better, to re-thinking a strategy or the overall direction of the business. 2. Select appropriate contributors This is important if the final recommendations are to result from consultation and discussion, not just personal views, however expert. * Pick a mix of specialist and "ideas" people with the ability and enthusiasm to contribute. * Consider how appropriate it would be to mix staff of different grades. * Think about numbers. Six to ten people may be enough, especially in a SWOT workshop, but up to 25 or 30 can be useful if one of the aims is to help staff see the need for change. 3. Allocate research and information gathering tasks Background preparation is vital if the subsequent analysis is to be accurate, and should be divided among the SWOT participants. Preparation can be carried out in two stages: exploratory, followed by data collection; and detailed, followed by a focused analysis. * Gathering information on Strengths and Weaknesses should focus on the internal factors of skills, resources and assets, or the lack of them. * Gathering information on Opportunities and Threats should focus on the external factors over which you have little or no control, such as social, market or economic trends. However, you will need to be aware of and take account of the inter-relationships between internal and external factors. 4. Create a workshop environment If the compilation Compiling a program. See compiler. and recording of SWOT lists takes place in meetings, make sure that you exploit the benefits of workshop sessions. Foster an atmosphere conducive con·du·cive adj. Tending to cause or bring about; contributive: working conditions not conducive to productivity. See Synonyms at favorable. to the free flow of information and encourage participants to say what they feel is appropriate, without fearing or attributing blame. The leader or facilitator has a key role and should allow time for thought, but not so much as to let the discussion stagnate stag·nate intr.v. stag·nat·ed, stag·nat·ing, stag·nates To be or become stagnant. [Latin st . Half an hour is often enough to spend on Strengths, for example, before moving on. It is important to be specific, evaluative and analytical at the stage of compiling com·pile tr.v. com·piled, com·pil·ing, com·piles 1. To gather into a single book. 2. To put together or compose from materials gathered from several sources: and recording the SWOT lists--mere description is not enough. 5. List strengths It is often harder to identify strengths than weaknesses. Questions such as the following can be helpful: * What do we do better than anyone else? * What advantages do we have? * What unique resources do we have? * What do others see as our strong points? Strengths may relate to the organisation, the environment, market share, public reputation and to people--including the skills and knowledge of staff, as well as reasons for past successes. Other people strengths include: * Friendly, cooperative and supportive staff * A staff development and training scheme * Appropriate levels of involvement through delegation and trust. Organisational strengths may include: * Customer loyalty * Capital investment and a strong balance sheet * Effective cost control programmes * Efficient procedures and systems * Well-developed corporate social responsibility policies. 6. List weaknesses This session should not be seen as an opportunity to slate the organisation but as an honest appraisal of the way things are. Be careful not to take weaknesses at face value, but to identify the underlying causes. Key questions include: * What obstacles prevent progress? * What needs improving? * Where are complaints coming from? * Are there any weak links in the chain? The list might include: * Lack of new products or services * Declining sales of main or most popular product * Poor competitiveness and higher prices * Non-compliance with, or ignorance of, appropriate legislation * Financial or cash-flow problems * Lack of awareness of mission, objectives and policies * Regular staff absence * No method for monitoring success or failure. It is not unusual for "people" problems--poor communication, inadequate leadership, lack of motivation, too little delegation, absence of trust--to feature among the major weaknesses. 8. List opportunities This step is designed to assess, among others, the socio-economic, political, environmental and demographic factors which affect organisational performance. The aim is to identify circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or which the organisation can exploit and to evaluate the possible benefits to the organisation. Examples include: * Technological developments * New markets * Change of government * Changes in interest rates * Demographic trends * Strengths and weaknesses of competitors. Bear in mind that opportunities may be time-limited and consider how the organisation may make the most of them. 9. List threats Threats are the opposite of opportunities--all of the factors listed above may, with a shift of emphasis or perception, also have an adverse impact. Here the questions to ask include: * What obstacles do we face? * What are our competitors doing? * What changes are there in the market for our products? * What resource problems do we have? Threats may include: * Unemployment levels * Environmental legislation * An outdated out·dat·ed adj. Out-of-date; old-fashioned. outdated Adjective old-fashioned or obsolete Adj. 1. or obsolete product range. It is important to look at a worst-case scenario worst-case scenario n → Schlimmstfallszenario nt . However, this should not be allowed to foster pessimism pessimism, philosophical opinion or doctrine that evil predominates over good; the opposite of optimism. Systematic forms of pessimism may be found in philosophy and religion. ; it is rather a question of considering how possible damage may be limited or eliminated. Most external factors are in fact challenges, and whether staff perceive them as opportunities or threats is often a valuable indicator of morale. 9. Evaluate listed ideas against objectives With the lists compiled, sort and group facts and ideas in relation to your objectives. Consider which of the factors listed are of major importance and which are negligible  This article or section is written like a personal reflection or and may require .Please [ improve this article] by rewriting this article or section in an . . It may be necessary for the SWOT participants to select their five most important items from the list in order to gain a wider perspective. The key to this process is clarity of objectives, as evaluation and elimination will be necessary to cull cull the act of culling. Called also cast. the wheat from the chaff chaff 1. chaffed hay; called also chop. 2. the winnowings from a threshing, consisting of awns, husks, glumes and other relatively indigestible materials. . Although some aspects may require further investigation or research, a clear picture should start to emerge at this stage. 10. Carry your findings forward Make sure that the results of the analysis are integrated into any subsequent planning and strategy development. Revisit re·vis·it tr.v. re·vis·it·ed, re·vis·it·ing, re·vis·its To visit again. n. A second or repeated visit. re your findings at suitable intervals to check that they are still valid. Managers should avoid * Giving undue weight to opinions which are not based on hard evidence * Ignoring the ideas of participants at lower levels in the organisational hierarchy * Succumbing to "paralysis paralysis or palsy (pôl`zē), complete loss or impairment of the ability to use voluntary muscles, usually as the result of a disorder of the nervous system. by analysis" * Allowing the process to become an exercise in blame laying or a vehicle for criticism and recrimination A charge made by an individual who is being accused of some act against the accuser. Recrimination is sometimes used as a defense in actions for Divorce. Traditionally the underlying theory was that a divorce could be granted only when one individual was innocent and the * Seeing SWOT analysis as an end in itself and failing to integrate the results into subsequent planning Additional resources Books Guide to business planning, Graham Friend and Stefan Zehle London: Economist in association with Profile Books, 2004 Company analysis: determining strategic capability, Per Jenster and David Hussey David Hussey (born July 15, 1977) in Morley, Western Australia is an Australian cricketer who has represented Australia at under 19 level in his youth. A right-handed batsman and a right-arm offbreak bowler, Hussey has been given the nickname of Little Mr Cricket Chichester: John Wiley John Wiley may refer to:
This is a selection of books available for loan to members from the Management Information Centre. More information at: www.managers.org.uk/mic Internet resources Mind Tools: www.mindtools.com SWOT analysis is included in the section on Problem Solving problem solving Process involved in finding a solution to a problem. Many animals routinely solve problems of locomotion, food finding, and shelter through trial and error. . Business Balls: www.businessballs.com Provides information on the origins of SWOT analysis and has a template (1) A pre-designed document or data file formatted for common purposes such as a fax, invoice or business letter. If the document contains an automated process, such as a word processing macro or spreadsheet formula, then the programming is already written and embedded in the for the analysis. |
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