SWOT Analysis

SWOT Analysis 101

OVERVIEW

A SWOT Analysis is an in-depth look at a company or organization, and outlines the company’s Strengths (S), Weaknesses (W), Opportunities (O), and Threats (T) while providing an overview of its place within its market/industry.

WHAT IS THE PURPOSE OF A SWOT?

A SWOT Analysis is a useful tool for a company to use in identifying what it is doing well, what it can do better, and where hidden opportunities in the industry may lie so as to increase its market share, improve its outlook within its industry, or identify a niche within its industry that it can fill.

In breaking down the S-W-O-T, it’s important to note that the Strengths (S) and Weaknesses (W) are typically internal factors, while Opportunities (O) and Threats (T) are typically external factors.

So, what goes into each? We’ll cover that in the next section, so keep reading!

S: STRENGTHS

For this section, you will identify the strengths of the company from an internal perspective, as well as from the point of view of the company’s market and target demographics. These can be as simple as writing down the positive characteristics of the company, like that it has a strong organizational model or equitable and flexible internal policies suited to creating happy employees. Consider these questions as you are searching for this answer:

What advantages does the company have over its competitors?
What does it do better than its competitors?
What is the company’s unique selling proposition?

To determine these items, search the company’s website, annual reports, investor relations’ info, and LinkedIn (or other business) profiles. You can also search for third-party articles that provide insights into what makes the company strong or special.

W: WEAKNESSES

For this section, you will identify the weaknesses of the company, again from an internal perspective. This can be difficult since you don’t work there, or else you could probably list them off quickly! Because of this, looking at it from both an internal and an external perspective will offer you the best results to provide to the client. Consider these questions as you are searching for this answer:

What failures or disappointments has the company experienced?
What factors have caused them to lose sales to competitors?
What does the company’s target market see as their greatest weaknesses?

To determine these items, search the company’s website, annual reports, investor relations’ info, and LinkedIn (or other business) profiles. Also search for third-party articles that provide insights into what mistakes the company has made. Lastly, look at review sites and see what makes customers choose the company’s competitors rather than the company itself.

O: OPPORTUNITIES

For this section, you will identify the opportunities the company has available but of which it has not availed itself. This could be an opportunity related to the company’s industry (like something a competitor is doing but this company is not), it could be related to new market trends or changes in technology on the horizon, or it could be related to changing social patterns, lifestyles, or populations.

One way to approach this is to look at the identified Strengths and see if they open up possibilities, or to look at the identified Weaknesses to see how eliminating them or better addressing them might lead to opportunities.

T: THREATS

For this section, you will identify the threats the company may be facing. These could come from their competitors, from obstacles they are facing (like new laws or obsolete technologies), from cash-flow problems, or from any number of sources.

In researching this, consider the following factors:

Are there political or legal factors in the works that might negatively affect the market or company?
Are there economic factors that might be in play?
Is the socio-cultural environment changing in a way that might be detrimental to the company or have they not been responsive to recent changes like these?
Are there technologies changing the face of the industry or that its competitors are using, but this company is not?

Looking at the company’s overall market and industry forecasts, as well as studying what their competitors are doing (and doing well) will help you identify these.

SOURCING: BEST STRATEGIES

Step 1: Try to find pre-existing SWOT analysis:

There may already have been one or more SWOT Analyses conducted on this company. Start this query by conducting a search for those using search strings like “SWOT Company X” or for each section (“Strengths Company X”).

Step 2: Ensure that every source added is reliable and trustworthy:

If you’re able to find pre-existing SWOT analyses, great! Look to find the information validated by being mentioned in more than one place so your SWOT analysis is as comprehensive as possible.

WRITING: STRUCTURING YOUR RESPONSE

When writing a SWOT Analysis, you’ll create a spreadsheet and a short write-up.

The write-up should include:

Insights that briefly outline each of the major sections (SWOT) on the company.
An explanation of the methodology used to determine each of the sections
An overview of the findings detailed on the spreadsheet with the spreadsheet linked at least twice

The spreadsheet should:

Follow best practices
Include headings for each major section (SWOT) with information completed
Include a row or column for “Sources Used” for each section

5-STAR EXAMPLES

Please note these examples are strong but did not include the spreadsheet component.

All SWOT analyses should have a spreadsheet (see link in writing section above) component

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