Why I'm Not a Fan of the "SWOT" Analysis

Ask leaders about which tools they use for strategic planning and the most common reply is a ‘SWOT Analysis’. Which stands for strengths and weaknesses (internal), and opportunities and threats (external). And why wouldn’t every organization want to know about these?

The problem lies in how organizations come up with and utilize the information. Too often it’s simply the output of a brainstorming exercise. Everyone on the strategy team offers their opinion. (It’s amazing how ‘our people’ is always identified as a strength.) And even if the exercise is data-driven, filling in the four quadrants doesn’t provide any context. Are your strengths truly strengths compared to your competitors? Are they relevant to the current and/or emerging needs of your business? Should you develop them or should you shore up your weaknesses? And what of opportunities and threats? Do all of them require action? Do any of them? What action? How would you know?

Too often the so-called SWOT analysis produces nothing more than lists of items. And then arbitrary action. That’s not strategy.

There’s a better way. That’s the topic of next week’s blog.

Your thoughts?


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