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SWOT Unravelled – Discovering Your SWOT Strengths & Weaknesses

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The SWOT analysis technique is used to summarize your strategic analysis which includes both your internal and external analysis. This summary is categorised into four categories. These four categories are Strengths, Weaknesses, Opportunities and Threats.

Today, we will clarify for you the strength category and also provide you with a list of common strengths that you may find in your business.

The golden rule of Strengths: Strengths are characteristics about your businesses, they can only be identified in your internal analysis, as your internal analysis is the only type of strategic analysis that evaluates your business characteristics.

Now, let’s define strengths and take a look at the typical business characteristics that are commonly classified as strengths.

Strength Defined: Strengths are core capabilities of your business. They are areas where your business has an advantage over your competitor(s) that is valued by your customers.

In other words strengths are characteristics of your business that pass the better than your competitors test.

Recap Key Point: You will only find strengths when completing your internal analysis, A strength must be characteristics of your business.

Understanding Strengths

When completing your internal analysis you will find that your strengths will generally fit into two categories, tangible and intangible strengths. Let’s look at them both

  1. Tangible Strengths: A Tangible strength is a characteristic of your business that can be precisely identified, measured or realized.
  2. Intangible Strengths: An intangible strength is a characteristic of your business that can not be physically touched or physically measured

Now, we will look at examples of common tangible and intangible strengths that maybe found in your business.

Examples of Tangible Strengths

Your tangible strengths will tend to include characteristics about your business such as

  • Your physical assets including plant, equipment buildings and infrastructure
  • Long term rental agreements in good locations
  • Unique or market leading products
  • Access to sufficient financial resources to fund any strategic changes that you would like to make
  • Cost advantages over your competitors (This relates to your ability to provide the goods or service at a lower cost than your competitors. It has no reference to the sale price)
  • Volume, high volume can be a strength
  • Ability to scale volume up or down with relative ease

Examples of intangible Strengths

Your tangible strengths will tend to include characteristics about your business such as

  • The strength of your brand(s) such as having strong easily recognizable brands
  • Your market reputation, including a market perception that you are a market leader or an expert in your filed
  • The strength of your relationship with key customers, a strong relationship represents goodwill and is often seen as a strength
  • The strength of your relationship with your suppliers, again strong relationship can be seen as a strength
  • The nature of the relationship that you have with your employees
  • Any unique alliances that you may have with another businesses that compliments your businesses products or services in a way that is valued by your customers
  • The ownership of patents or proprietary technology can be a strength
  • A proven advertising process that works well
  • Having more industry experience in a field that requires some technical experience, including the skill of your managers, your collective industry experience and your profile in industry associations.

Where people often go wrong?

The first area where it is common to see strengths recorded incorrectly is in the language used to describe them. It is an easy mistake to write Macro Environmental observation up as strengths rather than opportunities, however this tendency should be avoided. For example “One of our strengths is a strong economy” this really is an opportunity and can be reworded as follows “The economic outlook supports growth”

And

A SWOT analysis is normally completed by the leaders in your business. In completing their analysis they are likely to position their leadership capabilities in with the other strengths. It is, of course, unrealistic for all leadership in all businesses to be able to pass the better than our competitors test. When faced with this self assessment it is best to look for indicators such as higher engagement scores, lower turnover, and higher customer satisfaction to validate where you place leadership in your businesses SWOT.

SWOT Strengths Summary

Your SWOT Analysis summarises the three strategic environments that your business operates in, they are your Macro Environment, your Industry Environment and your Internal Environment. You will only identify strengths during your internal environment analysis, this is because your internal analysis is the only area where you will identify characteristics of your business that pass the better than your competitor test. Strengths can also fit into two categorise they can be tangible such as plant and equipment or intangible such as patents.

Now you will have a sound understanding of strengths and how to identify them in your business.

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Source by Ian Pratt

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