SWOT, Won’t You?
With the New Year fast approaching, we have a fresh slate and a chance to start the year off right. As the saying goes “If you don’t know where you’re going, any bus will take you there.” Even if our organization is clear on where we are going, we will still need a reality check and team buy-in about on how to get there. Strategic planning – or an annual strategic tune up – is essential and the foundation to this is an unbiased evaluation of our current reality.
We’ve found one of the best ways to get an honest assessment is by using SWOT, which stands for: Strengths, Weaknesses, Opportunities and Threats. SWOT can be used company wide, or by department. For the sake of this article, we will focus on using SWOT for our winery DTC business. The process is best done as a team to get multiple perspectives and buy-in to both the process and outcome.
The first two quadrants, strengths and weaknesses, are internal environmental forces of origin as it relates to the business objectives. Strengths are characteristics of the business that give it an advantage over others. Before we move on to the heavy lifting, we must highlight our strengths so we don’t take them for granted, or lose focus while we get busy fixing our weaknesses. For example, your winery is highly rated on TripAdvisor and Yelp! for your outstanding customer service that’s great. Let’s make sure the same will still be said about us next year.
Weaknesses are internal roadblocks & challenges, the most troubling of which you are committed to fix. These are things that put your winery at a disadvantage. For example, if your Tasting Room traffic is flat and your conversion rates are down on sales and wine club sign ups these things need to be understood and fixed.
The other two quadrants, opportunities and threats, are external environmental forces like changes in the economy, legislation, technology, competitors or the marketplace.
Opportunities are usually abundant – the trick is to prioritize them. Where is the wind to our back? How can we best leverage external forces? What elements could we use to our advantage? Out of all the opportunities out there, where should we focus in the upcoming year?
Threats are potential issues that could really hurt our business. We may have little or no control over these threats – but we need to be aware of them so we are not caught off-guard. By identifying the most dangerous threats we can find ways to minimize their impact, or at least make sure all of our eggs are not in one basket.
Recognize the realistic weaknesses and threats that exist for your company and counter them with a robust and creative set of strengths and opportunities. Distinguish between where your organization is today, and where it could be in the future.
For practical application, use four separate flip chart pages (see picture). Engage your team in brainstorming each area – first strengths, then weaknesses, then opportunities, then threats. When everyone has input to all four areas consolidate your findings into themes. Keep your SWOT analysis short and simple, and avoid complexity and over-analysis since much of the information is subjective. Next, have the team vote on which ones in each category are the most important to the company and its goals. These will be the items that you will most want to use for planning and decision making. Great leaders bake the SWOT analysis process into the DNA of their team.
(Image from Wikipedia.org)