SWOT? So What?

I have been fortunate enough to study business and management through to MBA. I have also learned as much, as we all do, from the practical application of this academic endeavour. My approach to SWOT analysis is one such.

The traditional SWOT or TOWS (I prefer the latter) analysis is generally represented in a Boston box; you know the 4 x 4 matrix variety:

ABC Enterprises TOWS

-ACME’s new “green” widget
-Health and Safety regulation
-Health and Safety regulation
-High manufacturing costs
-Efficient distribution -Strong brand

We can find this representation in text books, most business cases and plans, adorning strategy presentations and so on, but what does it mean? Is it really an analysis? And that’s the point; unless you have written it you may not really know what it means. And even if you do, where is the analysis? I think there is a simple way to improve it.

I use “SWOT? So What?”, where the “So What?” forces the consideration of “So, what does this mean for the business?” i.e. analysis. It does exactly what it says on the tin.

A slight change to the layout reveals all.

ABC Enterprises TOWS

What? So What?
Threats ACME’s new “green” widget Next generation product that will take share from ABC until own “green” upgrade is ready
Health and Safety regulation ABC’s current widget is not compliant and will become illegal for use in public sector systems in 12 months, meaning limited sales now and requiring urgent replacement to avoid being forced out of the market.
Opportunities Health and Safety regulation Means new markets for H&S conformance variants of products.ABC can incorporate new regulation requirements into its replacement product at design stage to launch combined “green” and conformant.
Weaknesses High manufacturing costs Exerts severe pressure on margins if ABC needs to compete on price. When launching new green product, ABC will have to deliver differentiation or improve costs or both to compete effectively.
Strengths Strong brand Trusted brand with a strong following will enable us to pre-sell the new widget. By telling customers now that the new widget is coming and when, we should be able to persuade them to delay their replacements until it is.

My “SWOT? So What?” approach encourages us to go beyond just the headline and really explore what it means for the business. Not only does this give better and more beneficial information, but it tends improve presentations too, forming the basis for discussion rather than just being the cue for an explanation.

Next time you are in need of a TOWS/SWOT analysis…why not give it a try.

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One Response to SWOT? So What?

  1. Victoria says:

    Love the blog