How to do a SWOT analysis (part 3)
Step 3. SWOT matrix
Having calculated all the factors influencing the business and grouping them into four squares, we get the SWOT analysis matrix, as in the photo below. Thus, we classified all possible impacts on our business in 4 categories: Strengths, Weaknesses, Opportunities and Threats. Thanks to this matrix, we better understand our own business, and, accordingly, it is easier for us to make competent decisions.how to do swot analysis
SWOT analysis matrix
Step 4. SWOT Strategy
Stroking the matrix on the SWOT, it is easy to see that in each square two elements intersect. From this “intersection”, in fact, we can extract a separate business strategy and, on the basis of it, develop a business. In principle, everything is simple, but let us nevertheless examine in more detail each of them.
S-O Strategy – based on Strengths (strengths) and Opportunities (opportunities). It implies the maximum use of all strengths and opportunities.
W-O Strategy – based on Weaknesses (weaknesses) and Opportunities (opportunities). It involves working to overcome the weaknesses of your business with all the opportunities.
S-T Strategy – based on Strengths (Strengths) and Threats (threats). It implies the maximum use of all strengths to prevent external threats.
W-T Strategy – based on Weaknesses (weaknesses) and Threats (threats). It implies a complete improvement of the business and the removal of weaknesses and threats.
All these strategies have a right to exist, sometimes even simultaneously. Indeed, in business it does not happen that everything is smooth, and there are always weaknesses, and advantages, and dangers, and opportunities. So, understanding these things and having appropriate strategies is an important defense mechanism for a business.
In the end I’ll say: it doesn’t matter exactly how to do the SWOT analysis – it’s more important to understand that the analysis is needed, or at least very useful. If you have other ways, please do as you please. This is not the point – the point is to really understand the position of your business. It is very important.
If you really did the SWOT analysis in another way, please share in the comments.