Stage 1: Business Research
SWOT analysis
An analysis applied to strategic planning that identifies strengths and weaknesses, as well as opportunities and threats.
SWOT analysis is a strategic planning tool that will help you conduct a detailed study of the external and internal environment of your business.
In other words, it is an effective business planning tool that can help you analyze your business from a strategic point of view.
SWOT analysis is used in addition to competitive analysis.
The purpose of SWOT analysis
Comprehensively look at the business from all sides to qualitatively assess the internal environment — positive impact (S and W), and the external environment — negative impact (O and T).
Value for the team
This is a universal technique that will help us take a sober look at the strengths and weaknesses of the business, as well as identify opportunities and identify possible threats, and thus significantly increase the understanding of the business for which we are developing a product.
Value for the business
The main goal of every business is to be successful, competitive, and make money. To achieve this goal, it is necessary to be objective and balanced in decisions. SWOT analysis helps to see and evaluate all the factors influencing decision-making and identify business development opportunities.
Duration:
- Preparation: up to 30 minutes
- Main activity: from 4 to 6 hours
Creating process:
The external environment is what directly or indirectly affects the business (new market and economic trends, business relationships with customers or partners, demographics and political changes, etc.). The company cannot control these processes, but must be aware of all these points and take them into account when developing its strategy.
The internal environment is resources (financial, physical, human, access to the natural resources of the Earth, various patents or copyrights, etc.) and processes on which the company has a direct influence (training courses: trainings, workshops, various lectures or loyalty system, hierarchy in departments, etc.).
Step 1. Strengths of the company are its strong points (internal environment, negative impact (S))
These are the things that the company does particularly well or that make it different from other companies. Any aspect of the company that brings it a clear advantage is a strength.
For example, you are the largest IT company in Ukraine, which provides the largest number of services at a market price.
Step 2. Weaknesses are the weak points of the company (internal environment, negative impact (W))
These are the factors that hinder the growth of the company (make it vulnerable in the market) in the process of moving towards achieving strategic goals. At the same time, one must be able to distinguish between weaknesses that directly depend on the actions of the company and threats that do not depend on the actions of the company.
For example, since you hired a lot of staff, but did not find a project for them, they are not working now, and this hinders the growth of profits due to high maintenance costs.
Step 3. Opportunities are the company’s potential capabilities (external environment, positive impact (O))
It is necessary to include all aspects that are at least somehow related to the development of the market or the actions of competitors. That is, these are phenomena that the company cannot directly influence, but from which it can benefit if it implements certain actions in the short and medium term.
For example, the study of new technology, thanks to which you can reduce the cost of a product or enter the market with a new offer.
Step 4. Threats to the company (external environment, negative impact (T))
This means anything that can cause significant damage to the company. The section is very important because understanding the threats gives us a deep understanding of how to run a business to save the maximum amount of money.
For example, new IT companies appeared on the market, providing the same quality services, but 15–20% cheaper.
