Every commercial enterprise today is known for its individuality. Human qualities evolve with experience; similarly businesses grow with vital experiential learning. To stand out, mark your presence gradually and to keep a steady performance, a profound management tool – a SWOT analysis can come in handy.
Albert Humphrey, the researcher who coined the term in 1960’s, categorically stated in his study, “What is good in the present is Satisfactory, good in the future is an Opportunity; bad in the present is a Fault and bad in the future is a Threat.”
SWOT analysis is a strategic balance sheet of any business enterprise. It seems to be simple, albeit it is a comprehensive strategy for identifying not only the weaknesses and threats of a road map, but also the strengths and opportunities it puts forth.
The purpose of this analysis is to identify the strategy models that will best align an organization’s resources and capabilities to a business requirement. In other words, it is a foundation for evaluating the internal potential and limitations and the probable opportunities and threats from the external environment.
SWOT provides a good all-around view of the company’s current, forward-looking situation, strategies to distinguish yourself from your competitors and to accomplish the successive goals.
Identifying Business Strengths
You know it better, when your product is doing well in the market, because you know the strength of your product. And, probably this is something that your competitor isn’t good at. Identifying and evaluating company’s strengths helps to determine how to allocate the resources in a way that will result in the highest potential for revenue growth and profitability. SWOT matrix enables you to classify expertise and advantages that can be harnessed and prepares you for the competition.
When you’re gauging the competition and devising a marketing plan, conducting a SWOT analysis is an effective way to discover potential loop holes in the strategy. A realistic, rigorous assessment of organizational flaws prevents strategic blunders. Picture this; you enter a market with products that are clearly inferior to what well-entrenched competitors are offering.
Likewise, gaps in a business, superfluous expenses and other easy fixes can be identified and perked up by charting such weaknesses in the process.
Opportunity for Profit Growth
A business that discovers new opportunities matching its strengths will surely create new revenue streams. Constantly reviewing market opportunities helps businesses take advantage of latest market trends. Effectively, the company needs to strengthen itself to match the change.
Dealing with Challenges
SWOT analysis helps the company insulate itself from external threat currents. An unpredictable environment, regulatory norms, technology and trends are among possible factors that can threaten the viability and ongoing success of a business. By assessing these risks and challenges, company leaders canstrategize ways to tackle them.
We, at CerveauSys, are well versed with various such strategic planning, HR and OD concepts and tools that can help an organization achieve targets and significantly improve its performance.
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