A key element in your company’s success is strategic planning. By evaluating your company’s strengths, weaknesses, opportunities and threats, you can begin to recognize where you need to focus your efforts. This process, called SWOT analysis, can be particularly helpful when your small business is experiencing a difficult time or you are unsure about your current strategy. Team members may have different perceptions about how your business is doing in each of these four areas, so it may be helpful to go through this evaluation process individually before performing the analysis as a group.
When talking about strengths, you should consider what your company does that sets you apart from the rest. What do you do better than your competition? Ask yourself why your customers choose you, what it is they like about you and where you have a competitive advantage.
Discussing your company’s weaknesses may be difficult, but honesty is critical, even if it makes you uncomfortable. Consider why a client may choose to work with someone else. In which areas does the company struggle, and how can it improve? Look at company reviews from both clients and employees and discuss ways to increase your scores.
Evaluating your opportunities means looking at outside factors. Think about who your biggest competition is and what their vulnerabilities might be. Consider the state of the economy and how it may put you in a better position than your competitors. Perhaps there is a strategic partnership that you could enter into that could have a positive impact on both companies.
Ask yourself whether you are keeping up with your competition in terms of technology and customer service. Discuss any client relationships that may be volatile. Look at your internal threats as well. Do you have healthy cash flow? Is there a recession on the horizon, and are you prepared? Evaluate your staff and determine whether you have any problem employees who could make a negative impression on a client.
In the final phase of your SWOT analysis, start by looking at your strengths. See if there are ways you can increase your competitive advantage. Then look at how your weaknesses affect your ability to be successful. Determine whether your opportunities match your strengths. Address your threats, and see if you can eliminate any of them.
You can perform a SWOT analysis at any time. It can reveal areas of concern, yes, but it may also reinforce your current approach and show that you’re already on the right path.