How to Perform Your Personal SWOT Analysis
You’ve probably heard of the SWOT analysis tool – it has been used widely in business and management circles since the 1960s.
Its origins are uncertain but are often attributed to the Business Schools at Harvard and Stanford Universities.
With the recent expansion of business, psychology and self-help themes into the popular consciousness, facilitated by the internet, SWOT has crept into everyday jargon.
There is a good reason for the ubiquity of this strategic analysis method – it is easy to use and understand. It’ also broad enough to be applicable in all sorts of different fields. It can be conducted swiftly and with relatively low costs in almost any business.
The letters S, W, O, and T stand for Strengths, Weaknesses, Opportunities, and Threats.
The first two represent internal factors – things the decision-maker can choose and influence, and the last two letters represent external factors or things that are outside of one’s control.
As you can probably tell, the basis is quite simple – but just because there are many ways to use SWOT that aren’t technically wrong, that doesn’t mean they’re all effective.
Read on to find out how to apply SWOT analysis, the right way.
MANAGERIAL APPLICATION OF SWOT ANALYSIS
To start, identify the unit you are intending to analyze. Are you looking at a project, a process inside your business, a position or the whole business?
Try not to be overly general with your planning as you may just come to a conclusion of which you were already aware.
Make sure to formulate a very clear question or isolate a specific problem you want to solve by using SWOT. Refrain from being vague or uncertain – SWOT is neither a tarot reading nor a magic 8 ball, so be objective and take the time to analyze each category thoroughly, having your starting postulation in mind the whole time.
A SWOT analysis is easy to conduct and can be done quickly at practically no cost. This means that anyone with the operating knowledge of your business can do it.
Unfortunately, a way to check if you have filled out all the categories correctly has not been integrated into this analysis tool.
Be mindful of the subjectivity of your strengths and weaknesses – are you listing the right ones? Perhaps you have overestimated your strengths or underestimated your weaknesses.
SWOT does not provide a built-in way to quantify the categories so you need to set your own ground rules.
List the categories from most to least important, and try to fill them out in pairs – the first strength on your list should apply to the first opportunity, and opposed by the first weakness, which should also relate to the first threat on the list.
This isn’t, strictly speaking, a planning tool, meaning it doesn’t offer solutions in and of itself.
It is useful in strategy formation because it provides you with a framework through which you can become more aware of your strategic assets – it works as a hybrid between inspiration and a guide.
As you perform your analysis, you might notice new threats and weaknesses or strengths and opportunities emerge – so make sure to go back and retool from the start.
This might be a bit tedious, but the value of conducting SWOT can only come to the forefront when the categories are filled coherently, using non-conflicting methods and coming to compatible conclusions.
For example, you cannot list speed due to highly standardized procedures as a strength and then list a dynamic environment as an opportunity, because standardized procedures are vulnerable to fast-changing environments, so it would be difficult to exploit the opportunity without losing the strength and vice versa.
It is important to be diligent when assessing opportunities and threats. This is part of the process where research plays an important role.
A singular perspective is often not going to be enough, no matter how much of an expert on the subject of assessment you are.
For the sake of visual clarity and conciseness, try to limit yourself to a number of points in each category that will be legible in a single page grid.
You can do this on paper, in a Word document, in an Excel spreadsheet or by using one of the many preexisting SWOT visualizing tools available on the internet. This grid is often referred to in the literature as ‘the SWOT matrix’.
It is easy to overestimate your strengths. To avoid being overly biased, make sure to confirm the strengths you decide to list with the part of your organization they originate from.
When analyzing strengths make sure to match them to opportunities. A strong sales department isn’t very useful if there are no more available clients to expand to in the marketplace.
Try to answer questions like “What is your defining skill?”, “What resources do you have available that others do not?” or “What qualities of yours do others value the most?”
Make a list of stakeholders, or groups of people who you need to keep satisfied for your business to succeed.
Stakeholder theory was developed by the economist Milton Freedman and is used to explain the interconnectedness of all groups of actors in the capitalist market model.
Your stakeholders are your colleagues, your employees, your customers, vendors, suppliers as well as your local community and your government.
For example, your employees might see their pay and benefits as strengths that set you apart from your competitors.
Your community might value you hiring locally and investing in local initiatives. Your customers might value your prices, your customer service or your transparency.
Your government mostly cares that you pay your taxes on time and keep your paperwork in order, so probably don’t put these things high on the list if you are not a large government contractor.
Only list the strengths that give you a competitive edge. If everybody in your field has the same quality, then you must need to obtain it in order to enter the market.
It isn’t something that can set you apart from others.
A good starting point would be finding what you could be improving upon in your business, what resources you lack when compared to others in your field, or what aspect of your business gets the most negative feedback from people on the outside.
Honesty is crucial – you don’t need to sugarcoat. Give your employees and yourself full permission to speak without negative consequences.
Some of the things you find out this way might be tough to hear, but becoming aware of your weaknesses is the first step to finding a way to treat them.
Look at your underlings and ask them what processes need to be redesigned. Try to find bottlenecks in expenses and expediency.
Remember that just because you’ve been doing things a certain way for a long time, that doesn’t mean there aren’t better ways to do them.
Take another look at what you are outsourcing. Are you getting a good deal? Do you need to renegotiate?
Conduct a survey to find out how your business is perceived – weak brand awareness, negative brand associations, and inefficient services are some of the most frequently listed weaknesses, according to The Mendoza College of Business at the University of Notre Dame.
For the most comprehensive analysis of external factors, it is best to form your lists of opportunities and threats using a complementary tool to SWOT, called PEST. PEST is used to asses Political, Economic, Social and Technological factors that shape a businesses’ opportunities and threats.
The best way to approach the listing and prioritizing your business opportunities is by looking at your closest external relationships first. For example, a SWOT analysis was conducted and subsequently published for a construction project in Belgrade, around 2008.
The contractor lists their two top opportunities as favorable contract terms and reliable investors. This shows that the contractor finds their strongest sources of opportunity in their business partner and their reputation.
Similarly, when assessing your business opportunities, you should be looking at your business partners, clients and customers first.
Think of areas of development nobody in your field has had a chance to explore yet. This is especially important if you are looking to expand your business but find your section of the market to be too crowded or niche.
Are there any complementary products or services you could expand to without inferring any additional costs? List them as opportunities in your SWOT table!
The same logic applied for opportunities can be extended to the other side of the external equation. Perhaps you are not pleased with your immediate business relationships?
Looking at them closer may lead you to change the way you partner with those same people in the future, or it might show you that it would be best for those collaborations to come to an end.
Analyzing threats through PEST is relatively straight forward!
When looking for political factors that influence your business, think of not only global politics and the newspaper headlines but also things like local government, newly proposed regulations, as well as the work of boards and committees that affect the work of your business.
Think of labor laws as well, as they might impact your relationship with your employees.
Not all four PEST categories will shape your external factors equally – it depends on your business, its size, and field of work.
When conducting PEST, try to lean on quantitative data where possible, and ask for expert assistance. Somebody familiar with corporate law might be better suited to assess your political threats and opportunities than you alone.
Quantitative data about the economic and technological factors are readily available and shouldn’t pose too big of a problem to analyze, but social factors are more subjective and elusive to quantification.
Demographic data is one exception, as most countries publish it for free online. For other social factors, you can use your marketing department – they can coordinate customer satisfaction surveys or pull up already available customer data for you to look at.
Threats can come from your competitive environment as well – so make sure to look at your competitor’s strengths and see if you match up. Maybe they are better equipped to take advantage of an opportunity than you? Maybe they are leading an aggressive sales strategy and undercutting your prices?
Conveniently, SWOT analysis can be applied to your personal life too.
If you are feeling lost or uncertain of your position in the fast-changing world of today, consider taking a piece of paper and doing a bit of centering.
You can use SWOT to prepare for a job interview, a career change or any other personal and professional dilemma. Keep the positives to the left – strengths, and opportunities; to the right, you can put the negatives – weaknesses, and threats.
Biases can easily influence your personal SWOT, be it your perceptions of yourself or those of other people you have asked to contribute.
To avoid this becoming an issue, try to back up every claim with a real-life example or two. If you have put down kindness as your strength, make sure to think of all the ways in which you behave kindly in your day to day life and asses if this is a defining characteristic of yours.
If you’re asking from outside advice, present people with the opportunity to submit their ideas in writing – some might find it easier to gather their thoughts and be honest with you when they don’t have to say it all to your face.
A good way to keep accountability is to use your skills, qualifications, and certificates to back up what you claim are your strengths.
Again, be honest – is the barely passing grade you got at University something worth listing in this part of your SWOT table?
When it comes to self-criticism, some people are naturals. If you are used to putting yourself down, try not to see listing your weaknesses as a punishment or final judgment. They are simply supposed to be areas in which you have space to improve.
Try to avoid listing humble brags as weaknesses. ‘I’m too understanding’ or ‘I work too hard’ are not legitimate weaknesses.
You do not have to show your SWOT matrix to anybody other than yourself, so there is no need for dishonesty and false humility.
When listing personal strengths and weaknesses consult your stakeholders. Perhaps you are not able to directly ask some of them about yourself, so try to put yourself in their shoes and say what they would perceive as your shortcomings and virtues.
Your boss might like that you are punctual, your family and colleagues might appreciate your communication skills while your teachers might value your hard work, intellect, and interest in the subject matter.
If you are using SWOT for career planning, the external factors that are beneficial to businesses can be similar to the factors you can list as opportunities for personal development.
Economic growth, industry expansion, and new technologies can all be chances for you to put your strengths to good use.
Look at the personal contacts you have made throughout your career so far. There must be some people out there who would love working with you in the future.
List these contacts as strengths. Furthermore, look at the people around you that you admire and would like to work with.
Try to find ways to connect with these people. Look for job openings in their businesses and see if you are qualified. If you think this is a direction you can pursue in your career, put it under opportunities.
Similarly, the threats you face can be the threats your industry faces at large.
Aside from this, oversaturation of the labor markets with people whose competencies are similar to yours can be a threat or the downsizing of industries you are involved in due to modernization.
In personal applications of SWOT analysis, one can confuse threats with fears. Try not to make this mistake. Fears can often come from irrational insecurity and general anxiety and may not be real, or can be vastly overstated.
Threats are external and based in reality, so be diligent and try to quantify the things that you list as threats in your SWOT matrix.
When you are done creating your SWOT matrix, try to match the external factors to the internal ones to see a path forward form in your personal development.
Another thing you can do is to find positives that can be used to counteract the negatives you have listed.
SWOT analysis isn’t a list of chores – you cannot simply cross things off of this list.
If you try to treat it as a list of goals rather than a continuous process of self-improvement, you risk backsliding.
She points out that the analysis prepares her to give thoughtful answers to questions about personal weaknesses, as well as helping her foresee areas that might present challenges in her new job.
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