How To Do A SWOT Analysis

A SWOT analysis, also known as a SWOT matrix, is a tool that allows you to study a company’s situation. It can also be used on institutions, projects or people. It also analyzes internal characteristics and external situations. This tool allows you to know the real conditions that an organization is in. It also allows you to plan a strategy for the future.

When performing a SWOT analysis , it is necessary to remember what it will give us: a balance of power. The weaknesses and threats will be on one side. The strength and opportunities will be on the other. We should also keep in mind that a SWOT analysis is only a static model of the situation at a given time. As such, it does not last long. It is modifiable according to the circumstances.

When doing a SWOT analysis, the first thing you need to do is choose a goal you want to analyze. It can be a company, an institution, a project or a person. Once the target is selected, you will perform an internal analysis before the external one. The data obtained will be introduced into a matrix. This matrix will allow you to assess the situation of the analyzed object and make good decisions.

Internal analysis

During the internal SWOT analysis, you must consider two factors: strengths and weaknesses. Strengths are the qualities that give an advantage. If we analyze a company, we must analyze the availability of capital resources. We will also analyze the employees, the assets, the quality of the product, among other things. This will allow you to see if they are strengths that allow the company to gain a competitive edge over its competitors.

On the other hand, weaknesses include anything that hinders or limits the company. They can be energy resources, abilities or attitudes. Weaknesses are only internal problems. They must be identified and eliminated.

External analysis

An organization or person cannot exist outside the environment. The internal SWOT analysis would not be complete. It does not explain how the target relates to its exterior. Because of this , the next step is to perform an external analysis. It will help you figure out what the opportunities and threats are within the context. The first step to discovering them is to look for items you can find with some relationship to the organization.

Opportunities are positive factors. Threats are negative. Opportunities are provided by the environment. Once identified, the organization can use them to its advantage. On the other hand, threats are elements that can work against the organization. That is why, after all, it may be necessary to create an adequate strategy to deal with them.

Use the data in a SWOT analysis

When these steps are complete, put all the data in a two-by-two matrix. Charts will help us visualize it better. Use different points or hyphens to establish each element in the two previous analyzes. This will help in this part of the process.

When putting data into an array, you should have strengths and opportunities on one side. These are the positive aspects of our company and the environment. These will create the potential. They show us what measures to take or make decisions about. The second part of the matrix will show us the limitations. These will be determined by a combination of weaknesses and threats. These restrictions can be seen as warnings.

The matrix also gives us a third combination. These are formed by the diagonals . The combination of strengths and threats are risks. The combination of weaknesses and opportunities are challenges. Risk, as well as challenges, show the course you should follow. They determine future actions.

Decision making

Now that you have reached this point, you have completed the SWOT analysis. The only thing left to do is analyze the results of the matrix and make good decisions. The whole process is based on decision-making processes. In particular, you should organize the necessary information to make rational and objective decisions. The SWOT analysis can also help you create future strategies.

People do this analysis to make accurate decisions. Nevertheless, the results will depend on the quality of the information. Depending on how good the information from the internal and external analyzes is, you have less chance of making the wrong decisions.

Now you are ready to create your own SWOT analysis. If you want to proceed, you can always create a CFME analysis (Correct, Face, Maintain, Explore) which consists of four aspects. These aspects are to correct weaknesses, confront threats, maintain strengths and explore opportunities.