In an age where technology is advancing quickly and businesses are feeling pressure to adopt agile practices, automate, and to digitise pretty much everything, it is easy to lose sight of why this is important (if at all). Given the investment made by some businesses, it is surprising to learn that many investment decisions are made without a credible Strategy in place, or a clear understanding of the end in mind. For some businesses this comes down to time pressures, or a need to respond to immediate operational issues. Sometimes, this is as simple as underestimating the value of simple strategy tools and techniques.
This short blog is the first of many that focuses on basic tools and techniques that can help organisations develop better informed strategies, irrespective of size, complexity or industry. One of the most common strategy tools, the SWOT Analysis. Organisations can use SWOT Analysis to assess their current position before deciding on any new strategy.
So….What is a SWOT Analysis?
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats, and so a SWOT Analysis is a technique for assessing these four aspects of your business. You can use SWOT Analysis to make the most of what you’ve got, to your organisation’s best advantage. And you can reduce the chances of failure, by understanding what you’re lacking, and eliminating hazards that would otherwise catch you unawares. Better still, you can start to craft a strategy that distinguishes you from your competitors, and so compete successfully in your market.
How to do a SWOT Analysis
You can approach a SWOT Analysis in two ways: to get people together to “kick off” strategy formulation informally, or as a more sophisticated and formal tool. In either case, gather a team from a range of functions and levels in your organisation. Use brainstorming techniques to build a list of ideas about where you’re organisation currently stands. Every time you identify a Strength, Weakness, Opportunity, or Threat, write it down in the relevant part of the grid (Example below).
Image (Example SWOT Analysis Grid)
To clarify which section an idea belongs to, it may be useful to think of Strengths and Weaknesses as internal factors – that is, to do with the organisation, its assets, processes, and people. Think of Opportunities and Threats as external factors, arising from your market, your competition, and the wider economy.
How can LHC help?
There are no shortage of resources available on the web that provide further guidance and insights regarding the use of SWOT Analysis, however sometimes it is more valuable to exploit a third party to facilitate strategy development workshops and activities, particularly as they can offer objective assistance and reduce the risk of getting bogged down on the detail. Additionally, some organisations may find that a more complex Strategy tool may required. At LHC we can offer a really simple and pragmatic assistance, helping businesses develop effective strategies using SWOT Analysis or an alternative tool that best suites their needs.
If you would like to discuss the us of Strategy tools for your business, or simply investigate what cost-effective support we could offer, then please don’t hesitate to contact us. We are here to help.