The 4 elements of SWOT analysis
SWOT analysis is a basic tool for developing a strategy. Before you set the schedule for your company’s promotional activities, you need to reflect on a few aspects.
What is SWOT analysis?
SWOT is an acronym for the elements of analysis. The process includes an analysis of your strengths and weaknesses as well as opportunities and threats to your business resulting from the situation on the market. This way you will discover what constitutes the basis of your competitive advantage. During marketing campaigns, it is important to emphasise your opportunities and strengths. After all, you want to show yourself in the best light and make your prospective customers interested in your offer. In order to do that, some key issues need to be thought out.
S in SWOT = Strengths
Strengths are internal factors which are the assets of your company and which can determine your advantage over competition. For instance:
- highly qualified staff
- motivation to work
- wide experience of the management
- knowledge of the industry
- access to cutting-edge technologies
- unique know-how
W in SWOT = Weaknesses
Weaknesses are internal factors that stand in the way of your company’s growth. For example:
- lack of qualified staff
- low motivation of your employees
- little experience of the management
- no access to the latest technology
O in SWOT = Opportunities
Opportunities are external factors (over which the company has no control) that bring benefits to your firm. They increase your chances for success. Factors include:
- high demand for your products or services
- little competition in the industry
- favorable legal conditions
T in SWOT = Threats
Threats are external factors that prevent your company from development or being successful. The most common belong to:
- low demand for your products/services
- high competition
- unfavourable economic law
- presence of a monopolist on the market
What is the purpose of analysing your strengths and weaknesses?
The analysis of your strengths and weaknesses is essential. For starters, you will learn what is your competitive advantage in the technology industry. You will also find out what to work on in the future. Maybe some of the processes are ineffective? Does the service take too much time or expenditure? Or perhaps the problem lies somewhere else?
Above all, it is about drawing conclusions. Determine a set of criteria for evaluation. Make sure you present the outcome in such a way so as to make it possible to compare the statistics of progress or recession in specific areas after implementing some changes.
- Strengths + opportunities = aggressive strategy, i.e. taking advantage of the strengths of the company.
- Weaknesses + threats = defensive strategy, that is being set on staying on the market.
- Strengths + threats = conservative strategy. This is about the situation when the strengths of the company neutralise its threats, e.g. big financial reserves help to survive seasonal stoppages in orders.
- Weaknesses + opportunities = competitive strategy. In this situation, the key action is to eliminate those elements which do not take advantage of incoming opportunities.