Strengthen your SWOT Analysis with Research
13 May 2020 13:23
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Perhaps no tool has done more to help businesses strategically than the very popular SWOT Analysis. That’s because this deceptively simple listing of an organization’s strengths, weaknesses, opportunities and threats provides a very revealing picture, one that can help anchor and shape strategic decisions of all sorts. Thing is, many SWOTs are deficient in a key ingredient: research. Those SWOT analyses not shaped by research could lead companies to put their trust in questionable or even inaccurate data and insights leading to strategic dead-ends or even disasters.
Too often, SWOT analyses come together like this: a core group of company leaders gather offsite or in a conference room to discuss their organization’s strengths, weaknesses, opportunities and threats. These are listed on a whiteboard or on oversized Post-It Notes and then debated and prioritized before the group then aligns on what does (and doesn’t) make the list. Someone then volunteers to capture the final SWOT items and email them to everyone. People leave the room feeling a bit tired yet energized by—and confident in--the process and its outcome.
What’s wrong with this commonplace scenario? The individuals in the room typically rely on their own knowledge and opinions. This isn’t all bad since usually the executives and senior leaders in the room are quite experienced and do indeed know a lot about their company, competitors and industry. But a good portion of what typically gets suggested—and ends up on the formal SWOT diagram—is a matter of opinion and perspective. Rarely is scrutinized data provided to support these instinct-driven opinions.
This is why research is critical to a SWOT process whose results you can truly place your trust in. Here are three steps you can take to help embed more research into your next SWOT exercise for your organization:
- Ask people to come to the SWOT session with what they would consider to be, say, three key strengths, weaknesses, opportunities and threats—and come with well-documented data. This will help keep the discussion focused on items backed up by more than just opinion.
Pro Tip: Use customer research, NPS scores, financial trends and reporting, third-party reviews and digital results to backing up your analysis, and invite participants from a cross-section of your organization who can bring those stats with them to the session.
- As you go through the process, pay special attention to anything added as a strength, weakness, opportunity or threat that doesn’t have data to support it. It may feel “right” to the group, and perhaps it is as not everything can be validated by research. There is a place for gut and instinct to play in strategy, but only up to a point.
Pro Tip: Your team can agree to add something to your SWOT with an asterisk, indicating that it will remain there only after further validation is provided in the coming weeks.
- For more robust results, do a SWOT analysis for each of your key competitors—from their perspective. Having a SWOT for your company and your competitors will provide a meaningfully more accurate picture of the landscape you must compete in every day. You won’t have insider information to inform your SWOT, but research can help you make the most informed decisions.
Pro Tip: Third-party reviews, online reviews, stock analyst reports, and industry publications all can back up not only your internal SWOT but also of the ones you complete on your competition.Ask your participants to come with articles, reporting, industry or third-party data to inform and validate the SWOTs.
- Backing up your SWOT work requires a keen eye to quality information. Your SWOT analysis work is only as good as the research you put in to support it. Ensure that you are referencing insightful information from reputable sources.
Pro Tip: Take a look at unique sources for insights. Imagine what kind of insights you can gather from legal filings, regulatory information, patent filings and more? Is there a particular technology your competition is investing heavily in? Are there new regulations in place for a market you are looking to enter or exit?
A SWOT analysis can be a tremendously insightful and powerful tool, but especially if it’s shaped by research and, therefore, truly worthy of your trust.