Why Your SWOT is Useless
One of the traditional steps in developing a strategy begins with a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis. The results are usually unremarkable, highlighting the same things year after year, and failing to reveal any new, unique ways for the organization to compete. So can a SWOT really form the foundation of an effective strategy?
The SWOT framework is credited to Albert Humphrey, who developed the approach at the Stanford Research Institute (SRI) back in the 1960s and early 1970s. It was intended to be used to gain situational awareness. You examine your external opportunities and threats. Then you identify your internal strengths and weaknesses. The results are often a long list of items, often without any hierarchy of importance or validation from external data. And this is the problem — while some of the observations and opinions may be valid, the go-forward from a SWOT usually is driven by the strongest voice in the room.
Simply brainstorming items for your SWOT quadrants might get you some useful information, but if you want a SWOT to be really effective, it needs to put it in the context of a strategic framework. That context should be based on two key factors — where you plan to compete and how you plan to differentiate. Those factors must be driven by your overarching definition of success — in essence, what winning looks like for your organization. Then you can examine your capabilities and weaknesses, and identify where you need to invest your time, effort, and resources.
SWOT elements are highly contextual. Just because you have a strength, doesn’t mean it will help you compete more effectively, or achieve your winning aspiration. Alternatively, a weakness may only be a weakness in certain environments or for certain audiences. Some strengths can be weaknesses if they aren’t at a sufficient level to help you achieve your goals. The point is, you need to understand what you’re trying to achieve first (i.e. strategy), before wasting time on a SWOT analysis, as you very well may identify a bunch of potential capabilities that are irrelevant to your strategy.
Think back to your last SWOT analysis. Did you have a clear plan for developing weaknesses into strengths with respect to your strategy? Or did you cherry-pick different elements, and pursue the ones which you thought were easiest to address? Not all elements on your SWOT are worth pursuing, and putting your efforts in the wrong places can result in attacking the wrong threats, building the wrong opportunities, ignoring critical weaknesses, and doubling down on the wrong strengths. Without a strategic framework up-front, a SWOT can become just another check-box exercise, which as we all know, is pretty useless.
About the Author
Andrea’s 25-year, field-tested background provides practical, behavioral science approaches to creating differentiated, human-focused organizations. A 4x ADDY award-winner, TEDx presenter, and 3x book author, she began her career at a tech start-up and led the strategic sales, marketing, and customer engagement efforts at two global industrial manufacturers. She now leads a change agency dedicated to helping organizations differentiate their brands using behavioral science.
In addition to writing and consulting, Andrea speaks to leaders and industry organizations around the world. Connect with Andrea to access information on her book, keynoting, research, or consulting. More information is also available at www.pragmadik.com or www.andreabelkolson.com.
Originally published at https://www.linkedin.com.
