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My favorite framework

I feel guilty saying that I have a favorite framework. I mean all frameworks serve a useful purpose. However, a SWOT analysis holds a special place in my heart. It is a framework of which I never tire and it always delivers a useful result.

Most of you reading this blog will be familiar with the SWOT. It is an analysis of the strengths and weaknesses of a company and the opportunities and threats that it faces. It is so commonplace it is in danger of being dismissed as a useful tool. However, there is always a place for a SWOT and it is worth thinking about how to use it to greatest effect.

Strengths: these are the things that a company does well. They are the strong points of how a company operates and its various assets. These include its products, brands, promotion, distribution, prices, processes, people, financial results and so on. The strengths are important because they give an advantage over the competition. They may be used as a differentiator to distinguish the company and build the brand.

Weaknesses: these are things that a company does not do well relative to the competition or in the eyes of its customers. They cover the same subjects as the strengths – ie products, prices, promotion, distribution, profitability etc.

Opportunities: our focus here are on the opportunities in the marketplace. They arise from various aspects of the market such as its size, its growth, the economic situation, the competition, the environment or legislation. It is important to distinguish these external opportunities from the internal strengths. A brand may be the means by which an opportunity can be realised – it is not an opportunity in itself.

Threats: these are the flip side of opportunities. They may arise from a declining market or a highly competitive market. Legislation may pose a threat. There may be threats from a changing customer base.

Analysing the strengths, weaknesses, opportunities and threats is only the start of the SWOT analysis. The next and vitally important step is to determine what action to take when considering the strengths and the opportunities, the weaknesses and the opportunities, the strengths and the threats, and the weaknesses and the threats.

Where the strengths and opportunities collide they provide obvious actions. The combination of these two forces should lead to ideas for growth. Here there are plenty of other frameworks to structure an action plan. Take a look at

Where a company has strengths but faces threats in its marketplace, there is a need for defensive action. The threat could come from a competitor or a declining market and the SWOT will hopefully suggest how these can be countered.

Dealing with weaknesses and opportunities and weaknesses and threats is tricky. A weakness limits a company’s ability to exploit an opportunity and deal with the threat. Action to correct the weakness should become obvious from the SWOT analysis.

The SWOT analysis is not a one-off exercise. It is something that should be repeated often. It is also a great tool to use in a workshop as it gets everyone thinking about what the company does well and how we could improve. It sets the scene for growth.

Take a look at the framework on

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