The SWOT analysis is an extremely useful tool for understanding and decision-making for all sorts of situations in business and organizations. It is a useful technique for understanding your Strengths and Weaknesses, and for identifying both the Opportunities open to you and the Threats you face.
Here describe after the SWOT analysis has been completed, what do the managers need to do next.
The final analytical task is to home in on the strategic issues management needs to address in forming an effective strategic action plan. Here, managers need to draw upon all the prior analysis, put the company’s overall situation into perspective, and get a lock on exactly where they need to focus their strategic attention. – Thompson and Strickland.
- Where do the company’s strengths and opportunities reinforce each other?
- Where do the company’s weaknesses and threats reinforce each other?
First, you should try to take advantage of the opportunities that cooperate with your strengths. Opportunities that go with your strengths may prompt you to pursue a strategy of forceful expansion. The result of your SWOT analysis may also advocate other strategic choices. For example:
- Diversifying away from areas of major threat to more promising opportunities.
- Focusing on modifying weaknesses in spots of significant opportunities.
- Taking defensive measures in areas of threat where you are weak.
Concentrate on your weaknesses.
- Make your mind up which weaknesses need to be addressed as a priority. Other weaknesses have got to be accepted and respected until time and resources let you find a solution.
- Some weaknesses can be developed into strengths or opportunities. For instance, it might be feasible to turn a shortage- of production capacity into increased value for your product.
Some weaknesses have a clear solution. Such was, financial weakness might be solved by -raising further funds, and management shortcomings by recruiting new personnel.
However, some weaknesses will take time and money to get rid of. For instance, you may need to start a program of improvements through training, or quality management. Shield yourself against threats, For example:
- Build successful relationships (win/win) with suppliers and customers.
- Cultivate good employee relations.
- Ensure you have clear and reasonable contracts with suppliers, customers, and employees.
- Procure insurance against evident debacles.
- Make realistic contingency plans to deal with potential crises.
- Establish the right types of service contracts for key personnel.
- Invest in legal protection for your intellectual property.
- Benefit from low fixed interest rates to move an overdrawing of your account to long-term loans.