The Good, the Bad and the Ugly of the Detailed SWOT Analysis

If you are an advertising or marketing student, an entrepreneur or a business professional – be prepared to learn about one of the most basic and functional tools for marketers still practiced heavily today – the SWOT Analysis. Like many topics in school that students seem to avoid (learning the quadratic formula in Calculus, reading a Brave New World for English lit or that extremely uncomfortable topic everyone in health class is embarrassed to learn about) – the detailed SWOT analysis is just something you are going to have to face learning and get used to writing regardless of how advanced our advertising methods get. The detailed SWOT analysis will be around forever and can really help you get a grasp of the environment your product or service is getting into and what you have to give to your potential customers that your competitors have forgotten. So here it is in plain English – the good, the bad and the ugly of the detailed SWOT Analysis.

As a professional marketer that has been working in this field, representing a multitude of companies throughout North America for over 15 years I continuously stand behind the benefits and effectiveness of developing and using a detailed SWOT analysis. Before I start any new project, whether for myself or for a customer, I have, and will continue to include the development of a SWOT analysis. My suggestion to you is that if you want your marketing initiatives to perform like a professionally developed plan then you need to think and act like a professional marketer. In this article I am going to share with you…

o What is Good about developing a proper SWOT Analysis “The Good”

o What is the downside of developing a proper SWOT Analysis “The Bad”

o What if the SWOT analysis doesn’t appear to provide value to my marketing plan? “The Ugly”

So why do seasoned advertising executives claim that a detailed SWOT Analysis of your product/service could open your eyes to an opportunity you had never imagined? Let’s put it this way – if you are the owner of a brand new company and you need to sell your business to your future employees who are ultimately responsible for reselling the idea of your business – it is probably best that you have a clear sense of what your enterprise is about. Your business’ vision, mission and core values are so important to determining whether or not customers see your product/service as a need. Is the product category you are in thriving, full of competition or are you yesterday’s trend? All these answers can be yours – by breaking down your company in a SWOT Analysis.

What’s so great about a SWOT? The easiest way to answer this question – is found in the acronym – plainly stated – a SWOT will tell you what the strengths, weaknesses, opportunities and threats are for your business. Strengths and weaknesses are attributes of your business that are identified internally -what’s going on within your own company’s environment? Some of the strengths you may have is that you were the first entrant into a category (i.e. Red Bull in the energy drink category), has your company won any awards, what makes you different from your competitors (do you have something they don’t that difficult to copy?) Weaknesses could be that you were not “one of the originals” and you are lumped in with all the other gazillion varieties of soap available today – you lack that “must-have” feature. Or maybe your product or service is a seasonal item – so your key selling peak only happens during a certain quarter of the year – in which case – how does the company survive for the other 3 quarters? Strengths and weaknesses are easy to identify if you really sit and think about what your company is, stands for and what it offers your customers. Opportunities and threats are identified externally – these are aspects that happen outside of your company that you are unable to control. Going back to the Red Bull example, the fact that the general public was finding themselves more frequently exhausted and looking for a “pick me up” – paved the way for Red Bull to really pack a punch with the public. And perhaps, the easiest example of a threat is something most companies seem to be facing today – the depressing state of the economy and the public cautious with their spending. These four aspects are quick and easy ways to access your company and with a little thought – you may open your company up to opportunities you have not have originally seen.

What’s so bad about a detailed SWOT Analysis – well for a first timer, be prepared this is only one of a gazillion SWOT Analyses you will do on a variety of companies and products. But don’t worry – practice makes perfect. Sometimes the first few SWOT’s can take a fair bit of time to nail down the formula, but soon it will become as simple as riding a bike.

The ugly of the detailed SWOT analysis is very rare but has seen the light of day. Perhaps the product category is so complex that a SWOT really doesn’t answer any immediate questions for your business. Or you’ve finally completed what you thought was an amazing analysis, only to realize that after investing a large amount of money in your “dream project” you’ve entered into an overly-saturated market and your product (with no great added value) will soon be lost in the masses – YIKES! Also, some companies mistake their internal strengths as external opportunities – in which your SWOT analysis becomes skewed and rendered non-helpful.

So even though as a first timer you become frustrated with what makes an attribute internal or external, the fact that sometimes you need to research your category to really get into some interesting opportunities once you become familiar with this process, there’s a good possibility you may begin to dream about SWOT analyses and begin applying them to your everyday life – one of the great things about a detailed SWOT analysis is that it’s a basic structure that really puts your business into perspective for yourself, your employees and most importantly what you have to offer your customers.

The Dangers of Traditional SWOT Analysis

It’s that time of year again. And, no, I’m not referring to Christmas shopping. It’s only September, for gosh sake!

I’m talking about strategic planning.

This is the time of year to pause for a bit longer than usual and think and about what winning will look like next year. It’s when we peer into the future to determine where our organizations need to go and what we need to do to get there in the upcoming calendar year. It’s when we identify our top three to five strategic objectives, lay out the specific action steps needed to achieve them, and determine a realistic timeframe for reaching our destinations.

For most companies, conducting a SWOT (strengths, weaknesses, opportunities & threats) analysis is an integral part of the strategic planning process. And it can be very helpful because an accurate identification of SWOTs plays an important role in determining subsequent steps in the planning process.

For those not familiar with SWOT, strengths are those areas where we excel that are not easily copied by others. These include things like financial and people resources, infrastructure, management, price, delivery time, brand strength, customer service, product quality and so on. Weaknesses are the risks or limitations that get in our way. Anything that constitutes a strength can also be a weakness if we don’t perform well in that area.

Opportunities represent possibilities that we can capitalize on or leverage. They come in all shapes and sizes and can pop up as a result of market trends, new technologies, changes in the political or economic environment, competitor actions, and more. Threats consist of events in the external environment that give us cause for concern. For example, what are our current competitors likely to do, and where might unexpected competitors come from? An opportunity can also be considered a threat if our competitors are better positioned to take advantage of it.

When used properly, SWOT is a powerful planning tool. Unfortunately, many companies misuse it by getting stuck in old patterns of thinking about problems and threats rather then looking ahead to where the company needs to go and focusing on winning.

A primary goal of strategic planning is figuring out what you can do, not what you can’t. However, rather than looking for new and better ways to add value to their customers, many companies use the SWOT process to focus on blaming competitors, the economy, or other external factors for things they can’t control. As a result, they end up spinning their wheels rather than gaining any real traction to move the company toward its destination.

The key to using SWOT effectively is not just identifying your strengths, weaknesses, opportunities and threats. It’s asking the right questions and using the information that gets uncovered in an appropriate manner.

For example, when considering your organizational strengths, ask questions like:

  • Where have we really been able to excel?
  • Is there something we have that we don’t use/do enough?
  • Is there something we can develop quickly that we can leverage?
  • What do others consider our greatest strength?

When considering weaknesses:

  • What has gotten in our way in the past?
  • How do we get in our own way?
  • What processes do we have for identifying weaknesses in the organization, and how well do these processes work?
  • What processes do we have for addressing these deficiencies, and how well do these processes work?
  • What functional silos are scattered across the organization?
  • Are we monitoring signs and signals from the marketplace that can both support our expectations, if appropriate, and provide strong evidence when new paths are desirable or necessary?

When identifying possible opportunities:

  • Is there a product, a customer relationship, or a market presence that we can better leverage?
  • Is there something we would pursue if we had more resources (people, dollars, time, etc.)?
  • What are our competitors most worried we will do? Should we?
  • What signals are critical to assessing our relationships with our market and customers?
  • How diverse is our portfolio of business relationships and opportunities? Are there numerous ways to succeed?
  • What investments are we making whose primary returns will be in the long term?
  • Are our plans formulated in ways that they will support adapting to evolving or new market opportunities, including unexpected opportunities?

When considering threats:

  • What are we most concerned about?
  • Are their new or different competitors likely to emerge?
  • Is there a potential supply problem?
  • Do we have good relationships with employees, vendors and customers?

It also pays to analyze and review how you conduct the SWOT process itself. Not just after the fact, but as you’re engaged in the process. For example:

  • What proportions of our organization’s resources go towards maintaining and enhancing the status quo?
  • How much time do we spend leading and nurturing new directions?
  • What new efforts have we started in the past year? What efforts have we stopped?
  • Is our long-term thinking focused on the few critical things that matter? Are we vigilantly avoiding the many possible diversions?
  • Do we have the people and financial resources to execute our plans successfully?
  • Do near-term problems and opportunities frequently preempt long-tem plans and undermine progress?
  • Does it seem like the rest will be easy once we have finished our plans?

Becoming a leader in today’s chaotic markets requires fast, flexible and highly adaptable organizations. Ones that anticipate and plan for change rather than react to it after the fact.

A SWOT analysis can help you achieve this strategic agility, but only if you use the information to break away from old patterns of thinking and make strategic decisions based on where you’re going rather than where you’ve been.

Next year will get here before we know it. What are you waiting for?

SWOT Unravelled – Discovering Your SWOT Strengths & Weaknesses

The SWOT analysis technique is used to summarize your strategic analysis which includes both your internal and external analysis. This summary is categorised into four categories. These four categories are Strengths, Weaknesses, Opportunities and Threats.

Today, we will clarify for you the strength category and also provide you with a list of common strengths that you may find in your business.

The golden rule of Strengths: Strengths are characteristics about your businesses, they can only be identified in your internal analysis, as your internal analysis is the only type of strategic analysis that evaluates your business characteristics.

Now, let’s define strengths and take a look at the typical business characteristics that are commonly classified as strengths.

Strength Defined: Strengths are core capabilities of your business. They are areas where your business has an advantage over your competitor(s) that is valued by your customers.

In other words strengths are characteristics of your business that pass the better than your competitors test.

Recap Key Point: You will only find strengths when completing your internal analysis, A strength must be characteristics of your business.

Understanding Strengths

When completing your internal analysis you will find that your strengths will generally fit into two categories, tangible and intangible strengths. Let’s look at them both

  1. Tangible Strengths: A Tangible strength is a characteristic of your business that can be precisely identified, measured or realized.
  2. Intangible Strengths: An intangible strength is a characteristic of your business that can not be physically touched or physically measured

Now, we will look at examples of common tangible and intangible strengths that maybe found in your business.

Examples of Tangible Strengths

Your tangible strengths will tend to include characteristics about your business such as

  • Your physical assets including plant, equipment buildings and infrastructure
  • Long term rental agreements in good locations
  • Unique or market leading products
  • Access to sufficient financial resources to fund any strategic changes that you would like to make
  • Cost advantages over your competitors (This relates to your ability to provide the goods or service at a lower cost than your competitors. It has no reference to the sale price)
  • Volume, high volume can be a strength
  • Ability to scale volume up or down with relative ease

Examples of intangible Strengths

Your tangible strengths will tend to include characteristics about your business such as

  • The strength of your brand(s) such as having strong easily recognizable brands
  • Your market reputation, including a market perception that you are a market leader or an expert in your filed
  • The strength of your relationship with key customers, a strong relationship represents goodwill and is often seen as a strength
  • The strength of your relationship with your suppliers, again strong relationship can be seen as a strength
  • The nature of the relationship that you have with your employees
  • Any unique alliances that you may have with another businesses that compliments your businesses products or services in a way that is valued by your customers
  • The ownership of patents or proprietary technology can be a strength
  • A proven advertising process that works well
  • Having more industry experience in a field that requires some technical experience, including the skill of your managers, your collective industry experience and your profile in industry associations.

Where people often go wrong?

The first area where it is common to see strengths recorded incorrectly is in the language used to describe them. It is an easy mistake to write Macro Environmental observation up as strengths rather than opportunities, however this tendency should be avoided. For example “One of our strengths is a strong economy” this really is an opportunity and can be reworded as follows “The economic outlook supports growth”


A SWOT analysis is normally completed by the leaders in your business. In completing their analysis they are likely to position their leadership capabilities in with the other strengths. It is, of course, unrealistic for all leadership in all businesses to be able to pass the better than our competitors test. When faced with this self assessment it is best to look for indicators such as higher engagement scores, lower turnover, and higher customer satisfaction to validate where you place leadership in your businesses SWOT.

SWOT Strengths Summary

Your SWOT Analysis summarises the three strategic environments that your business operates in, they are your Macro Environment, your Industry Environment and your Internal Environment. You will only identify strengths during your internal environment analysis, this is because your internal analysis is the only area where you will identify characteristics of your business that pass the better than your competitor test. Strengths can also fit into two categorise they can be tangible such as plant and equipment or intangible such as patents.

Now you will have a sound understanding of strengths and how to identify them in your business.

Understanding SWOT Weaknesses

A little about SWOT

SWOT…. Strengths, Weaknesses, Opportunities and Threats. The SWOT analysis technique is typically used during strategic planning to provide a concise summary of a strategic analysis. Generally your strategic analysis will include an analysis of your three strategic environments, which are your

  • Internal Environment,
  • Industry Environment, and your
  • Macro Environment

In this article you will learn all about how to identify weaknesses and to help you to get started we have also provided you with a list of common weakness. We will also show you how to avoid the common mistakes that are often made when categorising weaknesses.

Now let’s start by defining the term weakness as it relates to your SWOT analysis.

Definition of a Weakness

Corporate Level Weakness Defined:A weakness is a core capability of your business where your competitor(s) have an advantage over your business, which your customers value i.e. you failed the better than your competitors test.

During your SWOT analysis you will consider a variety of weaknesses from within your business. It is important to note that these weaknesses will all be internal to your business and they are all found during your internal analysis.

The SWOT technique can also be used at divisional, departmental and team level. When completing a team level analysis, you should identify strengths and weaknesses from the eyes of your internal customers.

Understanding SWOT Weaknesses

Some Possible Weaknesses

There are two categories of weaknesses that you may identify in your business, both are equally valid and should have receive equal consideration, these two categories are

  1. Tangible Weaknesses, these describe characteristics of your business that can be precisely identified, measured or realized. (Normally you can touch them)
  2. Intangible Weaknesses, these describe characteristics of your business that can not be physically touched or physically measured (You can not touch them)

Now, that we have identified two categories of weaknesses let’s take a look at some common tangible and intangible weaknesses that maybe found in your business

Some possible tangible weaknesses that you may find in your business

  • Old or outdated plant and equipment. Old plant or equipment is generally supported by equipment reliability issues or a lack of general competitiveness.
  • Narrow product line
  • Insufficient financial resources to fund changes
  • High costs (Not high price, high costs specifically refers to the cost of brining your product or service to market)
  • Inferior technology or technology that does has not kept pace with customer or supplier preferred transaction methods.
  • Low volume or restricted in your ability to scale up

Some possible intangible weaknessesthat you may find in your business

  • Weak or unrecognizable brand
  • Weak or unrecognizable image
  • Poor relationships with your customers
  • Poor relationships with your suppliers
  • Poor relationships with your employees
  • Marketing failing to meet objectives
  • Manager inexperience
  • Low investment in research and development
  • Low industry knowledge
  • Low innovative skills

Where People often go wrong

The most frequent error we see in a SWOT analysis with the categorisation of environmental observations. This is particularly prevalent when identifying weaknesses.

It is common for weaknesses to be identified as an opportunity to resolve the weakness rather than as a weakness, and some times as a threat of the harm the weakness may cause.

For example

A weakness of poor relationship with your employee’s, could be written up as an opportunity to improve labour relations or as a threat of industrial action by militant employees. It is important to categorise it as a weakness. Why?

It is important to categorise your weaknesses correctly as later you will look to find opportunities that capitalise on your strengths as these are your greatest strategic opportunities and threats that are exacerbated by your weaknesses as these are your greatest strategic risks.

If you have worded a weakness as an opportunity there is a risk that you will not identify your strategic risks and appropriately prioritise action to mitigate these risks.

Another common issue with identifying a SWOT weakness is to allow personal preferences to come into play. For example, if you are a big fan of apple computers but the company who you work does not use them, it is not valid to claim the organisation has a weakness that they use inferior technology. It is only a weakness if the choice of technology platform is restricting your business from competing with your competitors.

And the final item is that managers are often reluctant to be open and honest about the weaknesses of the business that they are running. They see it as a failure on their part. It is best to encourage leaders to be open and transparent about the weaknesses in their business, only by be open can you ask for help.


By the virtue of its name the SWOT analysis technique is an analysis technique NOT a solution technique. It is hard to remain focused on analysis, but important to do so. A thorough analysis is the perfect foundation for making strategic decisions.

Once the SWOT analysis is complete the next stage of strategic planning is to develop alternative possible courses of action.

Marketing Planning – Don’t Do SWOT

SWOT (Strengths, Weaknesses, Opportunities, Threats) is a popular framework for developing a marketing strategy. A Google search for “SWOT” and “planning” turned up almost 93,000 hits (August 2004), most all of which laud the use of SWOT. Some students have said that it is the most important thing they learned at the Wharton School.

Although SWOT is promoted as a useful technique in numerous marketing texts, it is not universally praised: One expert said that he preferred to think of SWOT as a “Significant Waste of Time.”

The problem with SWOT is more serious than the fact that it wastes time. Because it mixes idea generation with evaluation, it is likely to reduce the range of strategies that are considered. In addition, people who use SWOT might conclude that they have done an adequate job of planning and ignore such sensible things as defining the firm’s objectives or calculating ROI for alternate strategies. I have observed this when business school students use SWOT on cases.

What does the evidence say? Perhaps the most notable indication is that I have been unable to find any evidence to support the use of SWOT.

Two studies have examined SWOT. Menon et al. (1999) asked 212 managers from Fortune 1000 companies about recent marketing strategies implemented in their firms. The findings showed that SWOT harmed performance. When Hill and Westbrook (1997) examined the use of SWOT by 20 companies in the UK in 1993-94, they concluded that the process was so flawed that it was time for a “product recall.”

One advocate of SWOT asked: if not SWOT, then what? Borrowing from corporate strategic planning literature, a better option for planners is to follow a formal written process to:

  1. Set objectives
  2. Generate alternative strategies
  3. Evaluate alternative strategies
  4. Monitor results
  5. Gain commitment among the stakeholders during each step of this process.

I describe this 5-step procedure in Armstrong (1982). Evidence on the value of this planning process, obtained from 28 validation studies (summarized in Armstrong 1990), showed that it led to better corporate performance:

  • 20 studies found higher performance with formal planning
  • 5 found no difference
  • 3 found formal planning to be detrimental

This support was obtained even though the formal planning in the studies typically used only some of the steps. Furthermore, the steps were often poorly implemented and the conditions were not always ideal for formal planning.

Given the evidence, SWOT is not justified under any circumstances. Instead, use the comprehensive 5-step planning procedure.


Armstrong, J. S. (1982) “The Value of Formal Planning for Strategic Decisions,” Strategic Management Journal, 3, 197-211.

Armstrong, J. S. (1990), “Review of Corporate Strategic Planning,” Journal of Marketing, 54, 114-119.

Hill, T. & R. Westbrook (1997), “SWOT Analysis: It’s Time for a Product Recall,” Long Range Planning, 30, No. 1, 46-52.

Menon, A. et al. (1999), “Antecedents and Consequences of Marketing Strategy Making,” Journal of Marketing, 63, 18-40.

Marketing Strategy Plan: Key Ingredients Of A SWOT Analysis

In every marketing strategy plan, the first step in determining your current position in the market is through a comprehensive SWOT analysis. This helps you identify and improve your Strengths and Weakness while focusing on the external Opportunities and Threats that may positively or negatively affect your company.

1. Strengths

In a SWOT analysis, Strengths are considered part of the internal factors favorable to your marketing strategy plan. This basically covers areas regarding your competencies, assets, income generation, and other intangibles like customer support and positive public image and reputation, good admin – employees relationship, and camaraderie in the work place. When you define your strengths, it must reflect the present situation and have a clear plan on how you will be able to maintain and nurture it so these factors will always be the driving force of your company.

2. Weaknesses

Weaknesses can be derived both from internal and external factors. These are usually the areas in your operation that may have a negative impact on your marketing strategy plan. The purpose of creating a list of your weaknesses is so you can adjust your strategies to include improvements in these areas. Among the common weaknesses of companies are where your operation is losing money, lack of experience, skills, and or resources among others. Weaknesses can also account for a bad reputation, significant decline in the levels of trust among consumers, or simply due to the absence of any strength.

3. Opportunities

Opportunities are basically external factors that offer potential benefits for your business. When creating a marketing strategy plan, having a good grasp of the opportunities is highly beneficial. This enables you to take advantage of various factors that may have positive effects on your endeavors such as the current economic condition, cultural climate, market volume, economic demand, etc. When you know your opportunities, you can also see the actual needs of your target market that are not being met. In essence, these opportunities are actually your future strengths and must be prioritized.

4. Threats

Although threats are usually viewed as an external condition that may impede your marketing strategy plans, they can also be viewed internally. Threats can be an unstable economic condition, cultural differences, unfriendly social conditions, significant changes in political stability, new industry regulations and legislation, and the current position of your competitor. Internally, threats are often found in the workplace such as the unstable admin – employee relationship and other related conditions. As opposed to Opportunities, Threats in essence are your company’s future weaknesses and must be addressed as soon as possible.

With the help of a SWOT analysis, you can analyze your business internally against your various resources, financial standing, support, etc. When you look at various external factors, you can examine various areas of the economy, political stability, industrial regulations, demographic, social, competitions, and technology that may have a direct impact on your business.

The Sales and Marketing SWOT Analysis

The S.W.O.T. Analysis, where you evaluate your Strengths, Weaknesses, Opportunities, and Threats, is well known in the business planning process. Many companies use this method during strategic planning exercises as a way to form strategies and make decisions on new business ventures or initiatives. It is powerful because it looks at both internal (strengths, weaknesses) and external (opportunities, threats) forces.

As powerful as the S.W.O.T. Analysis is for business planning, it is equally powerful in sales and marketing decision-making. By employing this traditional tool to each of your sales and marketing activities, you can take advantage of your strengths, uncover new opportunities, minimize your weaknesses, and eliminate your threats in amazing ways. That is, however, only if you can be objective. Otherwise, the exercise falls flat.

While the S.W.O.T. Analysis can be applied to decisions about business planning, product development and other strategic decision-making tasks, consider using it for the following two sales and marketing activities:

1. Deciding Marketing Vehicles: Use the S.W.O.T. Analysis to evaluate each marketing vehicle in your marketing plan. This will allow you to focus marketing efforts on the vehicles where you have the most advantage or opportunity and the most minimal amount of weakness or threat.

2. Developing Sales Presentation/Proposals: Apply the S.W.O.T. Analysis to the development of each of your sales presentations and proposals. Be sure to focus the analysis on evaluating each section based on issues specific to the customer you are pitching.

As you approach your S.W.O.T. Analysis, consider the following questions.

  • Strengths: What advantages does your company/product have that no one else has? What makes you most unique? Focus on those things that make your offer most compelling to a prospect or customer.
  • Weaknesses: Where can you improve? Where have you made mistakes in the past? What do you not have that other companies/products in your industry have? Focus on those things that most detract from your offer.
  • Opportunities: What trends lend to your strengths? What is the potential “expansion” potential over time? Opportunities are external factors that represent why your company exists or should/can growth.
  • Threats: What challenges do you face? What are your competitors doing? What is the overall competitive landscape? Threats are external forces that could impact your success, such as competition, operational capacity, cost of goods increases, etc.
  • No matter the purpose, using the S.W.O.T. analysis can force thoughtful, strategic, and creative thinking. And, when used properly, the S.W.O.T. Analysis not only helps you identify your strengths, weaknesses, opportunities, and threats, but it also helps you determine your strategies for addressing each.

    Website SWOT Analysis – A Real Life Example

    Do you wonder what is happening to your Internet Business? Why is that you cannot get traffic to your website; the conversion rate is too low; or opt-in visitor is too few?

    I was faced with a similar situation lately and I attempted to use what I knew about SWOT Analysis into my Internet Business. I use the same technique to perform a SWOT on a website and had surprisingly discovered some valuable facts for my Website

    In this article, I share with you my real-life example of my Website SWOT Analysis. You are invited to use it as a reference to your won Internet Business.

    Below is a sample website SWOT Analysis performed on my own Total Quality Management website I published in year 2001. It was written based on a knowledge-based approach. The ranking for this website is on Google page # 9 and has a PR=2. After 8 years published, it has never moved up to within Google page#3. Some of you may know that my newly published 3 months old SWOT analysis Blog has ranked Google page#1 for the last 3 months. This success story has prompted me to wonder why my Total Quality Management website page ranking is so far behind.

    My objective is to move my Total Quality Management website to Google page# 1 – 3 and I performed a Website SWOT Analysis using the SWOT Analysis template and example as my guides. Below are sample my Website SWOT analysis:

    The SWOT Factor – Strengths

    S1 – 8 years old website – matured

    S2 – website contained focused practical examples and case studies of Total Quality Management

    S3 – website ranked Google page#1 on with single keyword – “tqm”

    The SWOT Factor – Weaknesses

    W1 – design of the website is not professional

    W2 – website content remain static for several years

    W3 – navigation of the website is not comprehensive

    The SWOT Factor – Opportunities

    O1 – online research on Total Quality Management has high demand

    O2 – availability of TQM case studies and report are limited on website

    O3 – online website builder software are commonly available

    The SWOT Factor – Threats

    T1 – website with fresh contents and blogs have moved up to top Google page

    T2 – visitor to this TQM website is very low (from awstat)

    From the four SWOT factors, I continue to evaluate the seriousness and impact of each factors as a way to prioritize as I continue to use the SWOT template to formulate strategies. Once the strategies are formulated, then only I can take action. I encourage you to take this sample as a case study for your own Internet business or website and Application SWOT Analysis

    SWOT Analysis is No Magic 8 Ball

    Q: A key investor in my business has suggested that I hire a consultant to do a SWOT Analysis to help plan for the future. I try not to argue with my investors, but I’m not so sure I need to have this done. What do you think?

    — Laurie B.

    A: Laurie, before you call in the SWOT team to deal with this investor (sorry, couldn’t resist that one), let me tell you exactly what a SWOT Analysis is and how it can not only help you plan for the future, but get a gauge of how your business is doing today.

    SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. A SWOT Analysis is a written exercise that can help you clarify and focus on the specifics that make up the four areas that most affect your business. The purpose of a SWOT Analysis is to help you build on your business’ strengths, minimize and correct the weaknesses, and take the greatest possible advantage of potential opportunities while formulating a plan to deal with potential threats.

    Think of a SWOT Analysis as a checkup for your business. By spending a little time examining the internal and external factors that affect your business’ health you can better gauge the present state of your business and identify things that may adversely affect your business’ health in the future.

    It’s a good idea for every business to perform a SWOT Analysis on occasion, especially if you are doing strategic planning, contemplating a change in direction or formulating new strategies for distribution, marketing and sales.

    Should you hire a consultant to perform a SWOT Analysis for you? Speaking as a consultant who has been paid to perform SWOT Analyses for companies in the past, I can honestly (and yes, without bias) say that depends on three factors: (1) the size of your company; (2) how in-depth the SWOT Analysis needs to be; and (3) how much of your investor’s money you’d like to spend.

    Larger corporations are most likely to hire professional firms to perform such analyses, primarily due to the complex nature of big business. Some corporate SWOT Analyses can run on for several hundred pages. Typically, a consultant will charge up to $100 or more per hour to perform a detailed corporate SWOT Analysis and most large companies consider this money well spent as a good SWOT Analysis can reveal otherwise ignored factors that might increase the company’s bottom line or help avert future losses.

    For a smaller business, however, a professional SWOT Analysis can be an exercise in overkill. For your money you will get an impressive, detailed report that will make for great show at your next investor or board meeting and a wonderfully expensive door stop the rest of the time. I don’t mean to belittle the value of a professional SWOT Analysis for small businesses. It’s just that smaller companies can learn as much from their own efforts as that of an expensive consultant.

    You can perform a simple SWOT Analysis with a #2 pencil and a fast food napkin, but to get a truly accurate view of your company’s SWOT factor I suggest you do things a bit more formally (and without the aid of condiments). I recommend that you involve all the key players in your business, including management, employees, your attorney, accountant, even your spouse. My wife often gives me insights into my business just from listening to me talk at dinner. Sometimes we business owners and managers can’t see the forest for the trees. It’s good to have someone else point out things we might miss.

    Here’s how to perform a simple SWOT Analysis. On a piece of paper draw a vertical line down the center. Now draw a horizontal line through the center of the page. The paper is now divided into four quadrants. In the first quadrant (upper left) write the word “Strengths.” In the quadrant next to that write “Weaknesses.” Drop down to the second tier and label the first quadrant (lower left) “Opportunities” and the remaining quadrant “Threats.”

    Now just fill in each quadrant accordingly. Strengths and weaknesses are internal factors that affect your business. Opportunities and threats are the external factors. Let’s look at a quick overview of each.

    Strengths are those things that make your business stronger. Strengths might include: a product or service that sells well; an established customer base; a good reputation in the marketplace; a good track history; a high traffic location; strong management; qualified employees; ownership of patents and trademarks; and any other aspect that adds value to your business and makes it stand out from the competition. Strengths should always be gauged by the strengths of your competitors. If your business does something well just to keep up with the competition, it is not a strength. It is a necessity.

    Weakness are the antitheses of strengths. Weaknesses are those areas in which your company does not perform well or could stand improvement. These are the areas of your business that make you susceptible to negative market forces and aggressive competitors. Weaknesses might include: poor management; employee problems; lack of marketing and sales expertise; lack of capital; bad location; poor products or services; damaged reputation; etc.

    Opportunities are those things that have the potential to make your business stronger, more enduring, and more profitable. Opportunities might include: new markets becoming available or old markets that are expanding; possible mergers, acquisitions, or strategic alliances; a competitor going out of business or leaving the marketplace, making their customers open to you; and the potential availability of a desired employee.

    Threats are those things that have the potential to adversely affect your business. Threats might include: changing marketplace conditions; rising company debt; cash flow problems; a strong competitor entering your market; competitors with lower prices; possible laws or taxes that may negatively impact your profits; and strategic partners going out of business.

    Once you have filled in all four quadrants, you can use this information to create strategies that will help you make the best of the information learned. For example, once you have identified your strengths you can better use them to determine which opportunities to pursue and to help reduce your vulnerability to potential threats.

    Now that you know your weaknesses you can formulate strategies to overcome them so you can pursue opportunities. Knowing your weaknesses can also help you establish a defensive plan to prevent your weaknesses from making your business particularly susceptible to external threats.

    Whether you use a consultant or create a SWOT Analysis on your own it is important to remember that a SWOT Analysis is a subjective analysis tool that can be strongly influenced by the opinions of those performing the analysis. For small businesses especially it is imperative to keep the analysis simple and to the point. Don’t overanalyze and don’t immediately take the results as gospel.

    Remember, it’s an analysis tool, not a magic 8 ball.

    Here’s to your success!

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