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How to do a SWOT analysis

Checklist

  1. 1 Involve employees from all the key areas of your business in your SWOT analysis (SWOT: strengths, weaknesses, opportunities, threats).
  2. 2 Consider involving key customers, suppliers or other sympathetic outsiders who know your market and can provide an objective view.
  3. 3 Ask participants to collect and review information on internal resources and external factors affecting the business.
  4. 4 Arrange a brainstorming session to identify your firm's strengths and weaknesses and the opportunities and threats facing it.
  5. 5 Decide whether you have the skills and objectivity to chair the session yourself, or should use an external facilitator.
  6. 6 Create an open and honest atmosphere; avoid judging or disagreeing with suggestions; try to draw out weaknesses and threats.
  7. 7 Review internal operations (such as finances, marketing, management and personnel, production) to identify strengths and weaknesses.
  8. 8 Review external organisations (eg competitors, customers and suppliers) and the business environment and market to identify opportunities and threats.
  9. 9 When there are no further suggestions, discuss the ideas that have been raised; agree the key strengths, weaknesses, opportunities and threats.
  10. 10 Identify any additional information you need to confirm your analysis; if necessary, carry out further market research.
  11. 11 Assess the significance of your SWOT analysis; identify areas where you have a competitive advantage (or disadvantage).
  12. 12 Create and execute an action plan to tackle weaknesses, capitalise on strengths and opportunities and deal with threats.
  13. 13 Use the analysis and action plan as a review tool before important decisions, so that your decisions fit what your analysis suggests.

Cardinal rules

Do:

  • involve a team which understands your business
  • encourage openness and honesty in brainstorming
  • assess issues objectively
  • use your analysis to create an action plan

Don't:

  • avoid uncomfortable home truths
  • criticise or ignore suggestions made while brainstorming
  • base your analysis on inadequate information