Quick Insight
SWOT analysis provides an analysis of your company and business environment from which to set and prioritize strategies. I explain four common strategies and when to use or revisit SWOT.
Last week I explained why SWOT analysis (Strengths, Weaknesses, Opportunities, Strengths) is important. This week I’ll show how it helps you set your company’s strategy.
SWOT is a brutally honest assessment of the realities of your business. It is not a strategic plan. However, it provides an analysis of your company and business environment from which to set and prioritize strategies. It provides a crucial early step in a complete strategic planning process.
Each of the four quadrants of SWOT lends itself to different types of strategy:
- Strengths: Maintain and build on them
- Weaknesses: Reduce or eliminate them
- Opportunities: Capitalize on them
- Threats: Monitor and mitigate them
SWOT is like looking at a map with a dot that says “you are here.” Your vision is the destination (your “there”). In strategic planning, you decide how you will take your company from “here” to “there.”
Perform a SWOT analysis at the beginning of a strategic planning session. Then review it later when starting major initiatives. Your strategic plans may need to be changed because the assumptions made in an earlier SWOT analysis changed. A quick SWOT update can save you substantial time and money.
I wish you clear vision of where “there” is for you. I wish you the discipline and perseverance to get “there.” I wish you well.
- Rob Stephens
Further Insight
CFO Perspective Resources
Get all the CFO Perspective resources with a FAST (Finance and Strategy Toolkit) membership.