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November 9, 2020

How to conduct a suitable SWOT analysis.

How to conduct a suitable SWOT analysis?

Why SWOT? Strategy starts with data and the “SWOT analysis” helps to visualise on four quadrants all the internal Strengths and Weaknesses about our business and the gather data about our external Opportunities and Threats in the ecosystem we operate in.

The origins of the SWOT analysis technique is credited by Albert Humphrey, who led a research project at Stanford University in the 1960s and 1970s using data from many top companies. The goal was to identify why corporate planning failed. The resulting research identified a number of key areas and the tool used to explore each of the critical areas was called SOFT analysis. Humphrey and the original research team used the categories “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.”

A SWOT Analysis is important to assess your organization's current position before you decide on any new strategy.

To conduct a SWOT analysis, you must first set an objective or a goal which will help in guiding the analysis and formulation of strategies to achieve the set objective. For example, entering a new market. Once the objective is set, the next step is to list all the following:


Your company’s strengths are essential part of your organisation. You usually have control over these strengths as they are internal. It can help you judge the strength of your resources and assess how your organisation can differentiate from others in the market to gain competitive advantage. List down all the strengths of your organisation, for example market share, employees, your business location, cost advantages, financial resources, and competitiveness.


Just like strengths your weaknesses are also internal. Here you must focus on the resources of your company that you think needs improvement and include things that needs to be avoided to diminish long term negative impacts of such weak resources. The end goal of this is to identify weaknesses and develop strategies to turn them into strengths. It is of utmost important to be completely transparent and honest while listing weak resources.


These are potential business opportunities that you could take advantage of. Unlike strengths and weaknesses, these opportunities are external. These opportunities may include buying another business in your ecosystem, new technology, partnerships, training programs, a diverse marketplace, and a change of government. Although an opportunity for your company can be threat for another organisation, for SWOT analysis the same item cannot be mentioned in both opportunity and threat for the same company.


Threats are different when compared to weaknesses. Threats are external risks that your organisation might be exposed to while weaknesses are internal, and you usually have more control over them. Threats are the obstacles you might face while operating in the marketplace, these obstacles might include problems in supply chain, change in product quality standards, geo-political stability, increasing competition, uncertainty of global market etc. Overall, the end goal is to develop strategies that can help your organisation to better prepare for these obstacles and perhaps gain advantage over the competitors.


After listing all the four quadrants of SWOT, you have the data to strategize options to take advantage of your strengths, strengthen your weaknesses, exploit all the opportunities, and eradicate all the threats. SWOT analysis are used to support other strategic tools.

Our team at Mark Bouw Group has abundant experience in conducting such analysis and developing strategies to solve any business problem.

Please click here to download your free template for SWOT analysis and other strategic tools created by Mark Bouw Group.

Source: Humphrey, Albert (December 2005). "SWOT Analysis for Management Consulting"

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