When’s the last time you took a good look at your company, from the outside looking in? The same way your customers and prospects see you. If you are an entrepreneur or a startup, this tool should become your best friend.
A SWOT analysis is used to evaluate the strategic Strengths, Weaknesses, Opportunities, and Threats related to a project or entrepreneurial venture.
Try growing some SWOT antennae. This exercise keeps you from getting comfy in your status quo. You know, the way things are. It keeps you connected to the stuff that’s important to your customers, not the things you “think” are important (that’s looking at yourself from the inside out, where it’s comfy).
Every customer conversation you engage in permits you to communicate from a position of Strength. Are your business development conversations valuable and relevant to your customers? Does your value proposition resound and speak to your thought leadership in your area of domain expertise? Strong and relevant value propositions related to a secure business model and financials leads customers to want to do business with you.
What are your real Weaknesses? Nothing’s perfect, or at least doesn’t remain so. The marketplace is dynamic. Factors promoting a strong sales cycle one quarter may not be there the next quarter. What do you do, really really well. OK. Now ask yourself what your company does really, really poorly. What weaknesses can be addressed tactically, short term? What weaknesses are a sign that your business model and infrastructure might need to be examined, strategically. Weaknesses impact your company’s sustainability. Take the time to identify yours.
What Opportunities are presenting themselves to you and your company? Have you been researching your marketplace, so that you anticipated this type of opportunity coming your way? If so, you’ve hired in, ramped up, networked, and are poised to be “there” when the opportunity arises. Will your relationship allow this opportunity to be available, as your company grows? Or is this opportunity tactical – you are either ready and poised, or the train will leave the station without you. If your company culture focuses on constantly exploring the marketplace for opportunities, there will be other ones waiting for you as you grow your venture.
How sustainable is your company in the marketplace? Are you proactively insulating yourself from Threats to your competitive position, or do you find yourself constantly reacting? Go back and re-read the paragraph on your Strengths. When you create your Business Model, make it robust. You and your company need to weather many storms, some of which you can anticipate now and others which will present themselves only as a result of your growth. How scalable is your business model? How nimble in the marketplace are you – can you pivot if necessary? Are you a one-horse company or do you have various product, service, or platform offerings which you can leverage depending on fluctuations in the marketplace, the entry of new competitors, even changes in the weather.
SWOT Analysis isn’t an academic exercise. It’s part of good business practices, a solid business model, and a strong financial plan for your company. Just as you need to revisit your company’s business model at least one a year (in the case of mature companies) and monthly (in the case of start-ups), so you also should take your SWOT pulse at least once a quarter – or after trigger events occur that potentially can take your business to the next level.
How does your company, and your team, use SWOT Analysis in business planning?
Babette N. Ten Haken, Founder & President of Sales Aerobics for Engineers®, LLC, brings entrepreneurial mojo and business- and revenue-producing collaboration and communication tools to small and mid-sized businesses and startups. Download her newest White Paper at her Free Resources Page. She was named one of the Top 50 Sales & Marketing Influencers 2013. Her book, Do YOU Mean Business? focuses on technical / non-technical collaboration strategies and tools. You can download the first chapter here.