Entrepreneur Insight
How a SWOT Analysis Leads to Actionable Business Strategies
By Melody Yuan
Steps to gauge the health of your business and move forward by using a simple analysis.
For most businesses, the novel coronavirus pandemic has forced their doors to close for weeks, and even months. Despite financial aid programs hurriedly signed into law by federal and state governments, many small businesses have either shuttered completely or will remain closed until stay-at-home regulations are lifted. The good news, though, is that several U.S. states have now started to move forward with plans to ease restrictions, which means that businesses need to consider how to best resume operations.
“Some things we have been telling our clients is to do a SWOT analysis during this time,” says John G. Tile, a SCORE mentor in the Susquehanna, Pennsylvania chapter. “Identify the things in your business that are causing you issues and reimagine a business with smoother operations. This will help you pivot and improve your business model.”
Given the level of damage this pandemic has inflicted on businesses’ bottom lines, how can a SWOT analysis provide business owners with a strategy framework to help their business get back on track? Business mentors discuss the best approaches for business owners to conduct a SWOT analysis.
Engaging the SWOT matrix
At its basic level, a SWOT analysis is an organized list of the greatest strengths, weaknesses, opportunities and threats of your business. All four areas are constantly moving and changing as your business evolves. “I like to think that strengths and weaknesses are the things you have control over and can change within your business, while opportunities and threats are external circumstances that can’t be changed,” says Tile.
And the sooner you tackle it, the better. “It’s important to complete the analysis now so that you can face your fears head on and also balance them out with optimism,” says Louise Jenner, a career development and business coach at The Dream Business Coach. “Even if your business had to close its doors for a lockdown, there are a number of ways that you can reach out to existing and future clients to ensure they continue to feel valued. It’s an opportunity to build your community for the future.”
“Even if your business had to close its doors for a lockdown, there are a number of ways that you can reach out to existing and future clients to ensure they continue to feel valued. It’s an opportunity to build your community for the future.”
According to Jenner, a few questions to answer in the SWOT matrix during the pandemic include:
Strengths
- What are the strengths of your business?
- What are the strengths of your industry?
- How can you use these strengths to help others: not just your family, friends and neighbors, but also your clients, associates, colleagues, customers and prospects?
Weaknesses
- What are the weaknesses you’re already aware of in your business?
- Is your industry showing weaknesses that weren’t there before the coronavirus crisis?
- How can these weaknesses become strengths that will help you survive the coronavirus?
Opportunities
- What opportunities are there for you and your business now?
- If you’ve had to modify behavior, how can you build on this so that you’re stronger in the end?
- What can you do in your home environment to make things easier for you?
- What are things that you’ve been putting off that you can get done now?
- What products or services can you create/develop to help others survive the coronavirus emergency?
Threats
- What is the biggest threat(s) to your business right now?
- What is one thing you can do today to mitigate that threat?
- Make a list of all the other threats to your business that you can think of and arrange them in order of their likely occurrence.
- Write down one thing you can do or put in place that would mitigate these threats.
“You can’t do a SWOT analysis just once a year,” says Tile. “You have to keep doing it as situations change.” Jenner recommends involving the team when doing a SWOT analysis to ensure that all aspects of the business are covered.
A road map for actionable strategies
“You’ll have a roadmap after doing a SWOT analysis,” says Tile. “If your weakness included something like a lack of online presence, you can ask yourself what your business is doing to shift its focus online. Perhaps the intention has always been there to create a website or build a social media presence, and there’s no better time than now to take that initiative.” Seeing which aspects of your business each SWOT item relates to can help you hone in on actionable strategies.
Having examples to look at of other businesses that have turned SWOT analyses into business strategies can help provide a framework for yours.
“Once you’ve figured out your basic SWOT items, think about how you can cross-check between each item to create a strategy,” says Tile. For example, you can ask yourself, what strengths can your business use to leverage industry opportunities? When looking at strengths to threats, you could think about what new strengths your business can build to counter external threats. “Prioritize each of the items to the three most important for each category and create an action plan for those things,” continues Tile.
"Once you’ve figured out your basic SWOT items, think about how you can cross-check between each item to create a strategy."
Jenner agrees with prioritizing each item and turning them into actionable steps. “Once you’ve started, you’re much more likely to continue,” she says.
It’s also important to note the timing of each of the threats and opportunities. Are these external items seasonal? “If there are time constraints, be sure to highlight those in your action plan as short-, mid- or long-term goals,” says Tile. Having a timeline for each action item creates accountability and a sense of urgency when drafting a business strategy.
You don’t have to do it alone
Turning each item from a SWOT analysis into a part of your business strategy can be overwhelming. “If you can’t do everything in your SWOT matrix, do what you can and discuss the tough stuff with your business coach or a trusted advisor,” says Jenner. “There’s usually a solution to be found for most problems.”
There are several resources available to get feedback and find a mentor. For starters, it’s relatively easy to be matched with a SCORE business mentor like Tile. “We have a network of 10,000 business experts at SCORE, and our mentoring services are free, regardless of the number of times you visit a mentor,” says Tile. During this time of social distancing, SCORE mentors are still meeting remotely with business owners via video chat. You can find a SCORE mentor in your area code here.
Involving your team in the process, even if they are furloughed, can also be a positive activity and says that you want to move forward with them. “It sends a message that you are thinking of them and want to continue employing them when this is all over,” says Tile.
Plan to move forward
The path to full recovery will most likely be an uncertain and slow process for many businesses, even after the outbreak wanes. “You still have to be prepared and make the most out of the situation,” says Tile. “Having an updated business strategy that’s derived from what you’ve found during your SWOT analysis is going to help you move forward.”
Whether it’s finding a solution to customer retention or building more organic traffic to your website, there are countless ways that business owners can still work on improving their business structure, operations and strategy. “Remember your entrepreneurial spirit when you got into this in the first place,” continues Tile. “It’s gotten you to where you are now in your business. Don’t forget that.”
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