One of the most popular tools used for business strategic planning is the SWOT analysis.
A SWOT analysis means evaluating your company's:
Let's take a closer look:
Opportunities are areas of buyer need where your company can perform profitably. The best opportunities are the ones that are relatively easy for the company to pursue and that have a high probability of success.
Threats are the challenges posed by unfavourable developments or trends that could lead to reduced profits. Examples of threats could include the development of a superior product by a competitor, a high chance of a prolonged economic depression or unfavourable government legislation. Of course, there could be many more.
Strengths and Weaknesses
It's one thing to be able to sniff out opportunities, having the competencies to take advantage of them is just as important. You don't have to correct all of your business's weaknesses (that's usually impossible). The big question is whether or not you should stick to opportunities where your company has the necessary strengths, or whether your company should acquire or develop new strengths.
It's a good idea to evaluate your business's strengths and weaknesses periodically. It will help guide your decisions about which opportunities to pursue, and where you company should improve.
You can use a form like the sample below. To get started, download it as a spreadsheet and tailor it to your needs.
Download SWOT Checklist » (30 KB .zip)
|Sample Strengths/Weaknesses Analysis Checklist – HelpSME.com|
|Major Strength||Minor Strength||Neutral||Minor Weakness||Major Weakness||High||Medium||Low|
|1. Company reputation|
|2. Product quality|
|3. Service Quality|
|4. Market Share|
|5. Pricing effectiveness|
|6. Distribution effectiveness|
|7. Promotion effectiveness|
|8. Sales force effectiveness|
|9. Innovation effectiveness|
|10. Geographical coverage|
|11. Cost/availability of capital|
|12. cash flow|
|13. Financial Stability|
|15. Economies of scale|
|17. Able, dedicated workforce|
|18. Ability to produce on time|
|19 Technical skills|
|20. Visionary capable leadership|
|21. Dedicated employees|
|22. Entrepreneurial orientation|