10 Benefits and Limitations of SWOT Analysis You Should Know About - Status Articles

10/10/2019 10 Benefits and Limitations of SWOT Analysis You Should Know About - Status Articles
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10 Benefits and
Limitations of SWOT
Analysis You Should
Know About
SWOT De nition and Importance Part 1
10 Bene ts and Limitations of a SWOT Analysis Pa
Completing the SWOT Analysis Process Part 3
SWOT Analysis Best Practices Part 4
PART 1
De nition
What Is a SWOT Analysis?
A SWOT Analysis is an evaluation tool for business leaders to

assess the strengths, weaknesses, opportunities, and threats to
https://status.net/articles/swot-analysis-process-benefits-limitations/ 1/13
the organization.
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Platform
Typically, it is used in a strategic planning process to effectively

evaluate where the company stands before moving forward
with an opportunity or managing a limitation.
The SWOT Analysis tool is also used by new

entrepreneurs wishing to assess the competition in their
respective markets. Usually, each component of the
analysis is represented in a chart format with each
segment placed in a different quadrant.
Why Is a SWOT Analysis Important?
The SWOT Analysis causes business leaders to stop what they

are doing and assess where the company is going. It is the
hallmark of a strategic plan, and it enables leaders to sit down
with all internal stakeholders to discuss the short and long-term
goals of the company. Where this tool really shines is the
opportunities and threats. Throughout the busy work day and
meetings, it can be easy to forget to assess chances the
company has to grow. Going through the SWOT process allows
leaders to take the time to not lose out on any lucrative
opportunities. SWOT is a large part of the strategic planning
process, but many leaders are not utilizing this tool for various
reasons. According to PMI, 61 percent of respondents
acknowledge that their firms often struggle to bridge the gap
between strategy formulation and its day-to-day
implementation. Bridges Business Consultancy found that 70
percent of leaders spend less than a day a month on reviewing
strategy. The SWOT Analysis tool is so simple in its creation that

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improve on these issues if appropriately implemented.

Platform
PART 2
10 Bene ts and Limitations of a SWOT Analysis
The SWOT Analysis has a lot of positive aspects, but no tool is

perfect. Every leader should always be aware of the advantages
and the limitations for planning purposes.
Strengths
1 Can Be Applied to Any Company and Situation
The SWOT Analysis is so simple in its composition that it

can be applied to any company in any industry. It can
also be used among a wide range of situations and
strategic initiatives.
2 One Tool Can Tell Four Stories
While other evaluation tools may only be able to assess

one scenario at a time, the SWOT process can tell a
company four things at one time. This means leaders
can have four comprehensive discussions about
pertinent issues to the company at one time.
3 Comprehensive Data Integration
There is a lot of work required in creating a SWOT

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Analysis, and leaders can benefit from the combination Log In
of quantitative and qualitative information. Having this

data available can improve planning, increase
communication, and ultimately lead to better decision-
making.
4 Low Cost
Leaders do not need an expensive piece of software or

consultant to come in to guide them through the process.
All leaders need is a spreadsheet and time to fill out a
SWOT Analysis.
5 Simple
There is no need for training or technical skills to

complete this process. Therefore, anyone can do this.
Also, its simplicity makes it easier for others to
understand the process and the results so leaders can
quickly share the information with other staff members
regardless of their position in the company.
6 Helps Companies Play Offense and Defense
Depending on when business leaders decide to do a

SWOT Analysis, it can help leaders uncover
opportunities for profitability or fend off new competitors
that have entered the market. Either way, this tool
enables leaders to create a plan of attack for maximizing
strengths or managing threats and weaknesses
depending on the scenario.
Limitations
1 Lack of Prioritization
A SWOT Analysis can be overwhelming if leaders are

not clear on what they are going to prioritize. The tool
itself does not do this automatically, so it can be difficult
to decide what to address first. SWOT is designed to

address pertinent issues, so leaders may feel Get
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handle everything at once.
2 Lack of Clarity
What do leaders do if a factor is both a weakness and a

strength? How can they manage this using SWOT?
Unfortunately, the tool does not provide a reliable way to
do this. Leaders have to attach their values to factors
that show up twice and decide the best step for
addressing them.
3 The Analysis Is Subjective
A SWOT Analysis is only as functional as the data put

into it. It will reflect the biases and experience of the
individual creating it. This makes it impossible to receive
objective data concerning SWOT, so leaders may
wonder if the information is useful.
4 Too Many Opinions to Address
During the SWOT process, it is likely that a leader will

involve various managers, department heads, senior
executives, and even frontline employees. While all of
their opinions may be valid, it is difficult to address all of
their input. Therefore, some opinions will be left out.
PART 3
How to Complete the SWOT Analysis Process
Decide Who Should Be Involved – Leaders will want a
wide range of opinions to create a SWOT Analysis, but
they need to prioritize who is involved. The group should
be representative of various positions, demographics, and
past career experiences. However, leaders should make
sure the group is not too large as it will be challenging to
acknowledge everyone’s opinion.
Designate a Facilitator – The leader needs to be involved

in the actual SWOT process, so someone should take the
role of independent facilitator to free up the hands of the
leader. It should probably be someone from the outside
who is not driven by biases.
Clarity an Objective or Comprehensive Strategy – This

may not be the case, but many companies may be facing
an event that brought the need for a SWOT Analysis. Did a
new competitor enter the market? Are revenues down, and
leaders are trying to pinpoint why? Is a merger on the
table? These circumstances can drive the context and
conversation for the SWOT Analysis.
Brainstorm – The facilitator should have each member of

the team discuss the company’s strengths. One of the best
ways to do this is to have a ipchart and write down
everyone’s responses there. The point here is not to
evaluate each answer or take out duplicates; the goal is
just to get everyone’s input down on paper.
Remove Duplicate Ideas – Once all ideas have been

gathered, facilitators should then work with the team to
combine similar thoughts and get rid of duplicates. After
this process, the main ideas and points should be the only
ones still on the ipchart.
Clarify and Identify – This is the time to answer any

questions team members have about any of the listed
strengths (weaknesses, opportunities, or threats).
Individuals can delve deeper into the meaning behind
various ideas, discuss their relevance, and ensure everyone
is on the same page as to why they should be added to the
list. Once this is completed, facilitators should identify three
(at max ve), strengths (weaknesses, opportunities, or
threats) to include on the list. This step ensures teams can
focus on a manageable number of subjects without getting
overwhelmed.
Summarize Thoughts and Connect It Back to Company

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process back to the event that may have sparked it and
align these topics with overall company goals. This move
starts the process of discussing next steps for how to
move forward implementing the results from the SWOT
analysis.
Assign Next Steps – Does a consultant need to be brought

in to guide implementation? Do managers need to start
changing their operations to better align with the SWOT
analysis results? After the steps have been solidi ed,
leaders should develop next steps to address each of the
points identi ed for strengths, weaknesses, opportunities,
and threats.
PART 4
SWOT Analysis Best Practices
Prioritize
As stated above, the SWOT analysis does not have a

built-in mechanism for prioritization, so leaders are going
to have to handle this on their own. With the help of
others on the team, leaders can begin to assign levels of
importance to each component of the SWOT analysis.
This helps everyone know what the most significant issue
to address first is.
Keep the Competitive Advantage in Mind
Regardless of the issue that may have driven the

company to conduct a SWOT analysis, leaders should
always keep in mind how their company matches up the
competition. Does the company offer something to
customers that competitors cannot? It is essential always
to have this in mind when constructing a SWOT analysis,
as competition is something leaders will frequently have
to address.
Know Where to Look for Information
Some SWOT items may be easy to identify, but others

may need a bit more research. Gathering data for this
analysis can be daunting, but if leaders know where to
look for information, the process can be a lot easier. For
strengths and weaknesses, having a look at core
competencies, resources, value chain activities, R&D
processes, all functional areas, and organizational culture
can be a place to start. Opportunities and threats can be
gleaned from assessing the competition by keeping an
eye on market changes and conducting a separate
PESTEL (political, economic, social, technological,
environmental and legal) analysis.
Explain What a SWOT Analysis Is to the Organization
It is always a good idea to keep the organization in the

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travels fast, and any change in organizational behavior

can make employees feel like they are in the dark. Leaders
should be upfront about why this analysis is necessary
and what it will do for the company. Some individuals
may have never heard of a SWOT analysis, so it is best to
be safe than sorry to explain what it is and why it is
needed.
For a business to maintain productivity and stay ahead of

the curve, a SWOT analysis is necessary. It forces leaders
to take a look at the bigger picture, plan for the future,
and determine what the company’s competitive
advantage is.
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10/10/2019 10 Benefits and Limitations of SWOT Analysis You Should Know About - Status Articles

SWOT De nition and Importance Part 1

10 Bene ts and Limitations of a SWOT Analysis Pa

Completing the SWOT Analysis Process Part 3

SWOT Analysis Best Practices Part 4

What Is a SWOT Analysis?

A SWOT Analysis is an evaluation tool for business leaders to

👋 Free Online Tool for Teamwork - Status

Typically, it is used in a strategic planning process to effectively

The SWOT Analysis tool is also used by new

Why Is a SWOT Analysis Important?

The SWOT Analysis causes business leaders to stop what they

strategy. The SWOT Analysis tool is so simple in its creation that

👋 Free Online Tool for Teamwork - Status

10 Bene ts and Limitations of a SWOT Analysis

The SWOT Analysis has a lot of positive aspects, but no tool is

1 Can Be Applied to Any Company and Situation

The SWOT Analysis is so simple in its composition that it

2 One Tool Can Tell Four Stories

While other evaluation tools may only be able to assess

3 Comprehensive Data Integration

There is a lot of work required in creating a SWOT

of quantitative and qualitative information. Having this

Leaders do not need an expensive piece of software or

There is no need for training or technical skills to

6 Helps Companies Play Offense and Defense

Depending on when business leaders decide to do a

A SWOT Analysis can be overwhelming if leaders are

to decide what to address first. SWOT is designed to

handle everything at once.

What do leaders do if a factor is both a weakness and a

3 The Analysis Is Subjective

A SWOT Analysis is only as functional as the data put

4 Too Many Opinions to Address

During the SWOT process, it is likely that a leader will

How to Complete the SWOT Analysis Process

Designate a Facilitator – The leader needs to be involved

Clarity an Objective or Comprehensive Strategy – This

Brainstorm – The facilitator should have each member of

Remove Duplicate Ideas – Once all ideas have been

Clarify and Identify – This is the time to answer any

Summarize Thoughts and Connect It Back to Company

Assign Next Steps – Does a consultant need to be brought

SWOT Analysis Best Practices

As stated above, the SWOT analysis does not have a

Keep the Competitive Advantage in Mind

Regardless of the issue that may have driven the

Know Where to Look for Information

Some SWOT items may be easy to identify, but others

Explain What a SWOT Analysis Is to the Organization

It is always a good idea to keep the organization in the

travels fast, and any change in organizational behavior

For a business to maintain productivity and stay ahead of

Effective leadership is all about communicating

👋 Free Online Tool for Teamwork - Status

How to use Status Platform for effective leadership

1 Share company goals and objectives regularly.

2 Easily implement regular status updates for your team

3 No one forgets to ll in status updates because Status

4 Provide guidance and feedback:

5 Use status updates for future reference and decrease time

6 Optionally, enrich reports with the latest updates

7 Spend less time on meetings by making them more