New Year, new me? How to review your business using a SWOT analysis

A SWOT analysis is an evidence-based framework, often
utilised by businesses to evaluate their current competitive position and potential strategic improvements. This framework is a great way of observing what your business does well and… not so well.

Based on the information provided from within this
framework, the SWOT analysis allows businesses to consider both internal and external factors affecting the company, to form strategies that are likely to boost long-term success.

Using a SWOT analysis is crucial for businesses trying to
understand both their internal capabilities and external factors impacting their performance. By pinpointing strengths and weaknesses, businesses are able to decipher their internal capabilities and where efforts are required.

Strengths: Strengths involve whatever a business is doing
successfully. Whether it be a particular set of qualities your business has to offer or tangible assets such as machinery and stock. It might even be internal resources such as experienced, hard-working employees.

Weaknesses: Weaknesses highlight any difficulties preventing
a business’ optimal success. Companies seeking to gain a true understanding of their situation should prioritise honesty here. This is key to finding a solution and adapting. Weak search visibility, outdated systems and unique selling points lacking clarity are all indicators that improvements are due to
be made within a business.

Opportunities: Opportunities are external factors that businesses are able to capitalise on. This may include an emerging demand for products, a small number of competitors or certain trends that align with a business.

Threats: Threats consist of anything in the external environment that could jeopardise a business. This could consist of new competitors, economic instability or a change in the political environment. The key to managing threats and staying afloat is identifying them and creating strategies that reduce risk. This way there are no sudden surprises.

The outcome of a SWOT analysis depends entirely on how
thorough the process is. When a company prioritises assessing the ins and outs of their strategies and their approach to navigating external factors, decision-making becomes far more straightforward.

To conduct a productive SWOT analysis, the first question
you should be asking yourself is: What are the long-term goals of this business? Whether that be reviewing your entire business or assessing a specific product. Being aware of company goals will be helpful when deciding which strategies will be beneficial
to utilise.

Tip: Perspectives from all employees within your business will be beneficial when reviewing your company as a whole. More perspectives mean a thorough evaluation.

Under the four SWOT headings, list as many ideas and concerns as possible. Ensure that the framework is evidence-based to guarantee desired outcomes. Once completed, it’s time to evaluate and compare sections. E.g. are there any strengths or opportunities that offer a solution to a potential threat?

The true worth of this framework can be found in the final steps of its process. When ideas are converted into strategies, businesses have the opportunity to enhance their performance and monitor the ever-changing external environment.

The SWOT analysis is particularly important for small businesses
due to their limited size and resources. This makes successful decision-making all the more important. The SWOT framework allows small businesses the opportunity to identify issues within the business before they become expensive and cause further issues.

Evaluating strengths and weaknesses allows small businesses to
gain a better understanding of their competitive standpoint, as well as consider threats such as new competitors offering similar products/services.

Keep your framework simple to begin, and focus on your key functions.

Utilise your strengths to stand out from larger competitors and attract loyal customers.

Review and update your SWOT analysis framework often, to ensure being one step ahead at all times.

Encourage employees to participate in your small business’ SWOT analysis, to maximise input.

Ultimately, this framework paves the way for long-term success by underlining factors within a business that can often be overlooked and forces businesses to look at the bigger picture, and take a more forward-thinking approach.

Give it a go!