Conducting a SWOT analysis periodically allows you to consider all of your business’s strengths, weaknesses, opportunities, and threats as you fine-tune your business strategy.
Swot 101
A Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis typically consists of a grid to help identify these important components:
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Strength – a positive, internal aspect of your business that’s within your control. A strength could be something that your business is great at, your team’s knowledge and experience, your access to credit or your intellectual property or location.
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Weakness – a negative, internal aspect of your business that’s within your control. A weakness might be uninterested staff, a lack of experience, a heavy debt, tax burden or obsolete technology.
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Opportunity – similar to strengths except they’re external, positive factors that could be leveraged to your business’s advantage. For example, an extended drought could be considered an opportunity if your business produces water-saving devices.
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Threat – similar to weaknesses except they’re external, negative factors that could harm your business. For example, the same extended drought could be considered a threat if your business sells thirsty tropical plants or turf.
The SWOT analysis template, which you can download for free, provides you with an easy way to break down an issue based on your business’s specific strengths, weaknesses, opportunities, and threats.
Use the template to analyse a single issue. We recommend identifying the issue and presenting it as a short, easy-to-understand sentence such as:
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export widgets to Thailand
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print product labels in-house
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license our products to third parties.
Once the issue being assessed has been defined, the SWOT analysis template can be used to consider various criteria. Criteria for consideration could be resources, quality control and business capability, competitors, market demand, political effects, partnerships, and even legislative effects. This is along with any relevant strengths, weaknesses, opportunities, and threats, of course.
Identify some of the most important criteria where businesses are either strong or weak. Identify criteria that may pose either an opportunity or a threat. These considerations should prompt you to think about your business’s strengths, weaknesses, opportunities, and threats as they relate to the issue being analysed. These prompts may surprise you, revealing insights you might not have considered otherwise.
After conducting your SWOT analysis, you’ll have a set of objective insights that you can use to make smarter strategic decisions.
How to use the swot analysis template
Using a SWOT analysis template is easy. Here are a few steps you can follow:
Step 1
Define the issue that you’re assessing.
Step 2
Determine if your business is strong or weak. Enter your strengths and weaknesses accordingly.
Step 3
Determine whether an opportunity or threat exists. Again, if you think of any other external factors that could pose either an opportunity or threat, add them to your analysis.
Step 4
Analyse your strengths and weaknesses. Ask yourself:
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Are there any strengths that you’re underutilising?
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Do you have any weaknesses that you could easily fix?
Step 5
Analyse your opportunities and threats. Ask yourself:
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Are there any opportunities you could use to your business’s advantage?
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Do your strengths support such a move?
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Will you need to strengthen your weaknesses in order to leverage an opportunity?
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How might the threats you’ve identified affect your business?
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What steps can you take to mitigate those threats?
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Is it possible to turn those threats into an opportunity?
Spending time analysing your strengths, weaknesses, opportunities, and threats is a worthwhile activity that aids in decision-making and strategic planning.
Use a SWOT analysis template whenever you have a decision to make – or when you want to ensure your business is taking advantage of its strengths and opportunities while minimising its weaknesses and threats.
Source: NAB
Reproduced with permission of National Australia Bank (‘NAB’). This article was originally published at https://www.nab.com.au/business/small-business/moments/manage/planning/swot-template
National Australia Bank Limited. ABN 12 004 044 937 AFSL and Australian Credit Licence 230686. The information contained in this article is intended to be of a general nature only. Any advice contained in this article has been prepared without taking into account your objectives, financial situation or needs. Before acting on any advice on this website, NAB recommends that you consider whether it is appropriate for your circumstances.
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