What is SWOT? SWOT stands for Strengths, Weaknesses, Opportunities, Threats. SWOT analysis is a strategic planning technique for a business or a project. This method considers internal and external factors in order to develop an effective business strategy.
In building a business, it is quite important to know what a SWOT analysis is. In general, the notion of SWOT analysis is a planning method by evaluating 4 components, namely:
The first component of SWOT is the strengths or strengths in the business.
In SWOT analysis, W is weakness which means the weakness of the company or business.
The next SWOT component is opportunities , which means business opportunities.
Meanwhile, SWOT analysis related to business threats is threats.
Based on the understanding of the SWOT analysis, it can be said that this method will assist business owners in systematically managing the level of strengths, weaknesses, opportunities, and threats they have. That way, all parties concerned with the business can more easily understand and recognize the project or company. Question, have you compiled the SWOT in the right order?
Benefits of SWOT Analysis
Basically, the four main components can serve as a reference in carrying out the mission strategy to achieve the business goals (vision).
In other words, the benefit of a SWOT analysis is to help you plan your business prospects in a structured manner by knowing the following.
- How to make strengths (strengths) can generate profits through opportunities (opportunities)
- How to strategy to overcome weaknesses (weaknesses) that risk preventing profits
- How to make business strengths (strengths) able to face existing threats (threats)
- Steps to take to control weaknesses ( weaknesses) that pose a risk of creatingthreats.
The benefit of a SWOT analysis is to assist MSME actors who wish to obtain venture capital by submitting proposals to investors. This analysis will be very useful so that they can clearly know the internal and external conditions of their business.
How to Do a SWOT Analysis Correctly
Conducting a SWOT analysis is similar to a hearing meeting, to find out the right and wrong way of doing things. It’s recommended to have everyone take notes and have everyone quietly come up with ideas for something to start with. This prevents groupthink and ensures that all voices are heard.
After brainstorming, put all the notes and stick them on the wall, don’t forget to group similar ideas. Allow anyone to add additional notes at this point if someone else’s idea sparks new thought.
Once all the ideas are organized, it is time to rank the ideas. use a voting system where everyone gets five or ten “votes” which they can share in any way they like. Making notes in different colors is useful for this exercise.
Based on the voting exercise, you should have a prioritized list of ideas. Of course, the list is up for discussion and debate, and someone in the room should be able to make the final decision on priorities. This is usually the CEO, but can be delegated to someone else in charge of business strategy.
Sample SWOT Analysis
Questions These questions can help explain each section and spark creative thinking in the team.
Strength is an internal and positive point of your companyThese are things that are within your control. An example is
- What business processes are successful?
- What assets do you have in your team, such as knowledge, education, network, skills and reputation?
- What physical assets do you own, such as customers, equipment, technology, funding, and product patents?
What competitive advantage do you have over your competitors?
are negative factors that reduce strength. These are things that you may need to improve in order to become more competitive.
- Are there things you need to make your business more competitive?
- What business processes need improvement?
- Are there tangible assets that the company needs, such as funding or equipment?
- Are there gaps in your team?
- Is your position ideal to support your success?
external factors in your business environment that are likely to contribute to business success.
- Is market for your business growing and are there trends that will encourage people to buy more of what you sell?
- Are there events or events that your company can use to grow business development?
- Are there any regulatory changes that will positively affect your company?
- If your business continues to grow, does that mean customers need your product?
are external factors that you have no control over. You still have to consider this to place an emergency plan in dealing with problems that occur.
- Do you have any potential competitors who could enter the market?
- Will suppliers always be able to supply the raw materials you need at the right price
- Can future developments in technology change the way you do business?
- Has consumer behavior changed in a way that could negatively impact your business?
- Are there market trends that could pose a threat?
When your SWOT analysis is complete, you are ready to turn it into a real strategy. After all, this exercise is all about coming up with a strategy you can work on. Also read other articles about Startup, business, innovation, and technology on the Ideanation website www.ideanation.id.