Question: How can I take a good look at my company at the beginning of the year and recognize what I need to do to improve my outcomes (sales, profits, satisfaction, etc.)?
Answer: This can be done quite easily with an analytical tool called SWOT Analysis. Take a look at the example I have provided below.
Each year, it is a common practice among individuals as well as companies to assess their situations and make constructive plans for building strengths and overcoming weaknesses while capitalizing on opportunities and avoiding threats. This should be an ongoing process and hopefully will result in renewed motivation and ability to make changes where it is necessary while continuing to build on what works and helps drive continuous improvement
The business application of this assessment should be a disciplined process that addresses key issues and allows for recognition of both the favorable and unfavorable trends. The assessment tool commonly used in business is called SWOT Analysis.
The letters S and W refer to the internal facets of company operations, and stand for Strengths and Weaknesses. The letters O and T refer to the external facets of the operating environment, and stand for Opportunities and Threats.
Internally the company management should recognize its unique Strengths and Weaknesses. The Strengths should be built up and enhanced. The Weaknesses should be improved and turned into Strengths.
Externally the company should recognize existing (or potential) Opportunities and/or Threats through environmental scanning. Opportunities should be exploited. Threats should be avoided or eliminated.
Look at the example below and apply this technique to your business. SCORE mentors can help. Call 301-766-2043. Make the new year a huge success!
SWOT ANALYSIS FOR YOUR COMPANY
S=STRENGTHS, W=WEAKNESSES, O=OPPORTUNITIES, T=THREATS
INTERNAL ANALYSIS-STRENGTHS AND WEAKNESSES
Good Market Position with loyal customers and high quality products
Human Resource policies that create motivated workers, and low turnover
Strong financial position and profitable operations
Reputation for integrity, honesty and ethics
Management’s Job to build strengths
Develop and maintain those you have, Create those you don’t have
Inability to create and maintain sustainable competitive advantage
Low levels of profitability and customer retention
High operating costs due to low productivity and poor processes control
Low growth, falling margins, high levels of customer complaints
Management’s job to address weaknesses
Develop programs and policies to address and overcome weaknesses
EXERNAL ANALYSIS-OPPORTUNITIES AND THREATS
Research to find new techniques and products/markets
Changed strategy to reduce costs, increase profitability
Create product and process innovation through technology
Utilize techniques such as Lean Technology & Continuous Improvement
Management’s job to find opportunities
Create an environment where everyone seeks opportunities for growth and development
Vulnerability to litigation due to poor HR policies (sexual harassment)
Market erosion due to competitive inroads
Strategy that follows not leads industry innovation
Insufficient and poorly managed funding
Management’s job to address threats
Actively assess existing and/or potential threats and take action to avoid or eliminate them