SWOT ROT!

By Angela Schuster

SWOT analyses are often bandied around the office as though they provide all the answers to the business’ greatest dilemmas. In actual fact a SWOT (strengths, weaknesses, opportunities and threats) analysis is as good as useless unless compiled with a few basic principles in mind.

Most importantly it is vital that you don’t view a SWOT as your strategic plan. Certainly it should be a component of your strategic plan and can be useful in a business plan, but it is not the final plan. So, what is a SWOT and if you are going to produce one, how do you make it useful?

What’s in a SWOT?

"Technically", a SWOT analysis is a subjective assessment of data which is organised into a logical order that helps understanding, presentation, discussion and decision making. It is essentially an extension of the good old pros and cons list.

The SW of the SWOT

Generally in business and marketing the strength and weakness components of a SWOT refer to the internal environment, the situation within the business. These may include factors relating to products, pricing, costs, profitability, performance, quality, people, skills, reputation, processes etc and are factors that tend to be in the present.

THE OT of the SWOT

Conversely opportunities and threats are generally drawn from the external environment, the situation outside the business. These may include factors relating to markets, sectors, audience, seasonality, trends, competition, politics, economics, environment, society/ culture, technology (or PEST), etc. These factors tend to be in the future.

If your SWOT is not restricted to business and marketing the categorisation of internal and external factors can prove limiting, so a more open interpretation can be helpful, especially when considering opportunities and threats.

Simple rules for compiling a successful SWOT


  • Be realistic about the strengths and weaknesses of your business.
  • SWOT analyses should consider present and future factors (to be strategic it really should consider 3 years +).
  • Ensure all points are specific.
  • Apply SWOT as a comparison to your competition.
  • Consider the ramifications of any WOTs.
  • Consider SWs from your customers’ perspectives (this then becomes a CO-SWOT or a customer oriented SWOT).

Critical success factors

Critical success factors provide the "so what" when you look at a SWOT analysis.

Consideration of critical success factors are often overlooked but are, in fact, the most important component of a SWOT analysis. Without due consideration of these factors your SWOT is essentially as good as a pros and cons list and about as useful (read = useless).

Critical success factors are those factors that are important - critical - or required in order to:

  • Minimise or eliminate weaknesses
  • Match and leverage strengths to take advantage of opportunities
  • Convert weaknesses into strengths

After developing a SWOT you need to consider each item and work through the process of minimising, eliminating, matching, leveraging and converting.

As an example: Matching can help identify competitive advantages by matching the strengths to opportunities. Then, through leveraging strengths, you can exploit your opportunities.

Converting is to apply conversion strategies to convert weaknesses or threats into strengths or opportunities. If you are unable to convert your threats or weaknesses then you should try to minimise or avoid them.

The upshot

A SWOT analysis can be an extremely useful tool and can be integral in your business’ strategic plan but it is important that you use this tool appropriately. A SWOT without critical success factors is as good as useless.

Remember to always work through the process of leveraging your strengths to exploit your opportunities and use matching and conversion strategies to convert, eliminate or minimise weaknesses and threats.