As the owner of a small business, you are constantly looking for ways to analyze your organization to pinpoint areas for improvement. One valuable tool that can serve this purpose is a SWOT analysis. A SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats) is a method of evaluating the internal facets of your operation, as well as challenges that outside players and influences pose to your company. Here is a primer on how to conduct a SWOT business analysis.
Strengths
This aspect of the analysis deals with the internal things that your company does well. Think about some of the unique traits that your organization has that separates it from the competition. What are some valuable experiences that your firm has emerged from stronger because of the challenge?
Weaknesses
This facet also references internal issues that your company faces. Some key questions that you need to pose regarding your growing business relate to areas that you need to improve in and what resources that your company lacks which could possibly strengthen your operation. An important question to consider during this stage of the analysis relates to your bottom line. What are some areas or departments that are noticeably less profitable than the others?
Opportunities
Moving along to external influences, opportunities are factors outside of your business that contribute to achieving your objective. One very salient question to pose at this juncture: What are the established business goals that you are working toward? With the constant growth of technology, how can your business capitalize on the latest tech trends? Also, use this step to consider your current customer base. Are there potential customers that you aren’t reaching?
Threats
For this last area, think the external version of weaknesses. Threats are factors that present a challenge to your enterprise, but that you have no control over. Examples of external threats are the current (or future) economic climate and different trends in your company’s industry.
After completing a successful SWOT analysis, you should use the data gleaned from your exercise to identify new strategies and formulate short, medium, and long-term goals for growing your company and achieving future success.
Remember, running a business successfully does not need to be complicated. Keep it simple!
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Manny Skevofilax is a consultant and speaker that helps his clients successfully navigate the challenges of growing their businesses profitably. Since 2003, Manny helps businesses enhance their results by using his experience in strategic planning, financial statement analysis, operations, organizational development, and team-building. His consulting firm, PORTAL CFO Consulting, Inc., has attracted clients from diverse industries in the United States and abroad.
Manny can be reached at 410-808-3441 or via email at manny@portalcfo.com.