Back To CourseCreating a Business Plan
2 chapters | 15 lessons
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Jagina has conducted professional training in communications and analytics for 12 plus years, with a a degree from Kent State University in Journalism and Communications.
Have you ever wondered the best way to get a project off the ground? Have you ever watched a project become a virtual train wreck right before your eyes? Imagine you are provided a simple tool that makes assessing your situation easy to do. Perhaps the project management internal and external analysis process is just right for you.
SWOT analysis is the process of improving the overall success of a project by evaluating the internal strengths and weaknesses of a company, while also reviewing the external opportunities and threats that the company may face. That's why SWOT stands for:
SWOT analysis is a strong group process that allows for brainstorming, or open communication, within your company. This process involves bringing the company's key stakeholders, or people impacted by the decisions, into a room and setting up clear objectives for the conversation.
The goal in any SWOT process is to come out having a better understanding of your market, your company, and your competition. This analysis process should improve the whole project or the execution of the individual tasks. SWOT is a way to evaluate internal company factors, or things that can be controlled within the company, versus external factors that are beyond the company's control, such as the economy.
Let's say that for years you have been working at a cleaning service that has four locations in town. There are currently one hundred employees, and your company's president has decided that it's time to expand the cleaning empire. Fifty percent of the company's current contracts are for residential properties and the other fifty percent are for commercial businesses. The president assigns a project manager to assist the company in opening a new location.
The project manager decides to hold a SWOT meeting and invites several of the company's executive staff, supervisors from each of the key departments, a couple of the commercial clients, and a couple of the residential clients. The meeting is held at a local conference center, where four blank flip charts are placed for everyone to see. Each chart is labeled: strengths, weaknesses, opportunities, and threats.
This process is designed to clearly identify the internal versus external factors of a project:
Internal analysis can include reviewing historical or recent profit and sales for the company, the brand or product positioning, and employee capabilities. External analysis can include reviewing market demographics, the economy, current technology, customers, and suppliers. One of the most important external factors to review is the company's competition.
The SWOT analysis is all about asking the right questions to determine how to move forward with a project. For example:
So, imagine you're back at your company's SWOT meeting. The training manager is positive that it only takes a few weeks to get new staff up and running and considers that a great strength.
However, the hiring manager also feels that the new cleaning company in town, which only focuses on residential clients, is recruiting all the good talent in town by offering better benefits. The company should view this as a strong threat.
The head of marketing believes that the budget for advertising is too low and the company is not able to reach as many new clients online. This is a weakness.
However, there is a new auto leasing company that will provide substantial discounts to employers who lease more than twenty vehicles each year. The company views this as an opportunity to perhaps expand their footprint by being able to service more locations.
SWOT analysis has some great advantages. It's straight forward, requiring only a room, flip charts, and key stakeholders. It takes minimal cost and time, usually needing just a couple of days in one location. And it also encourages open communication. Every area impacted has opportunity to contribute.
The disadvantages of SWOT analysis is that it tends to create a long list, and some items need to be tabled for another discussion. This same list is not usually balanced. In other words, one strength does not necessarily cancel out a weakness. Also, sometimes the process can involve too many people. Ever hear the phrase 'too many cooks at the pot'? Make sure to narrow the audience to just those impacted.
For example, based on the SWOT discussion, your company may decide to take on that new leasing contract. The money the company saves will be invested in expanding the commercial side of the business by increasing their online advertising to potential business customers. As part of that process they will offer additional paid time off to new employees within the first year. The information acquired in the brainstorming session allowed the company to create a cohesive plan based on real input.
SWOT analysis is the process of improving the overall success of a project by evaluating the internal strengths and weaknesses of a company, while also reviewing the external opportunities and threats that the company may face. The SWOT process requires open communication through brainstorming, which involves the key stakeholders, or the people most impacted by the decisions.
Internal analysis evaluates controllable variables within the company and can include evaluating historical sales and profits, brand association, employee capability, and product positioning. External analysis evaluates uncontrollable variables outside the company and can include reviewing market demographics, current technology, customers, and suppliers. The most important item to review is the company's competition.
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Back To CourseCreating a Business Plan
2 chapters | 15 lessons