by Christopher Ryan, President – Fusion Marketing Partners
Socrates was right when he made the observation, “The unexamined life is not worth living,” and this applies equally to the individual, the team, the department, and the organization. Everyone, and every company, has one or more blind spots, and your ability to discover these blind spots is critical to the achievement of your marketing and sales goals. However, it is not just weaknesses that you must discover, but also your strengths, opportunities, and threats.
Andy Grove, co-founder of Intel, wrote a famous book titled Only the Paranoid Survive: How to Exploit the Crisis Points That Challenge Every Company. Forbes called Grove’s book “Probably the best book on business written by a business person since Alfred P. Sloan’s My Years with General Motors“—quite the compliment (among much other praise). The success of the book is no doubt due to its excellent advice, but also to the way the title and theme of paranoia resonate with entrepreneurs and business people of every stripe. Who doesn’t experience paranoia given the tough economic climate, international competition, and rapidly changing technology?
However, it is not enough for you to be paranoid. You need to understand why it is that you should be paranoid. What are the weaknesses in you, your department, your marketing strategy, the company? What are the threats both internal and external that cannot only take you off your game, but also potentially take you out of the game? Frankly, many people do not ask these tough questions because they would prefer not to know the answers. Ignorance can be bliss in the short term, but in the long term, it always catches up to you. Marketing and sales is a tough game, and to play a tough game, you need to be tough. And you can’t be tough if you don’t root out your weaknesses and find ways to minimize them or overcome them.
Likewise, it is necessary to know the strengths of your opponents (e.g., business competitors) because they will represent threats to you, and the weaknesses of your opponents because they represent opportunities to exploit. After all, marketing is war, and to win at war, you must be acquainted with yourself, your enemy, and the battlefield. As Sun Tzu put it so eloquently in The Art of War (highly recommended reading for the Fusion Marketer), “If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”
SWOT analysis came from research conducted at Stanford Research Institute between 1960 and 1970, stemming from the need to find out why corporate planning failed. Fortune 500 companies funded the initial research to find a way overcome poor planning. A SWOT analysis is a subjective assessment of data that is organized by the SWOT format into a logical order that helps understanding, presentation, discussion, and decision-making. The four dimensions are a useful extension of the basic list of pros and cons that many of us use to guide decisions.
According to the creators of the method, SWOT essentially tells you what is good and bad about a business or a particular proposition or category. A SWOT analysis always focuses on four categories:
Weaknesses – What are we not good at; where are our vulnerabilities; where are we less than adequate; where have we been ineffective in comparison to the competition?
Opportunities – Where can we take advantage of current market trends; where can we exploit our strengths and the competition’s weaknesses; what are the possibilities for a big win; what excites us the most?
Threats – Which of the competitors are coming on strong; where are the market trends working against us; what are the gaps that can be exploited by our competitors; what scares us the most?
At the first stage of the process, you are only asking questions, you are not attempting to create action items or set strategic direction. Do not draw conclusions at this point, and do not make any business decisions based on your answers. The point is to get all the relevant input out on the table before you attempt to organize the data and use it for planning purposes. Every SWOT analysis I have participated in has generated far more data than it is possible to work with. After the initial brainstorm and data collection phase, you will need to synthesize the data into the most important and relevant points of data.
Outcomes of SWOT Analysis
As a marketing or sales executive, you will want to perform the SWOT exercise at both the macro level (the entire company or division) and at the micro level (your department). In each case, you perform SWOT analysis to ensure all relevant issues are on the table, to make sure you are gaining consensus from the necessary stakeholders, and to guide actions that have the greatest chance of achieving your objectives. While the outcome is dependent on your particular needs and objectives, in general, you are looking to use each of the SWOT quadrants for issues like:
Weaknesses – How do we get the team (or company) to recognize its weaknesses, fix what is fixable, mitigate what is not fixable, or utilize outside resources to bring us up to par?
Opportunities – Of the many opportunities we have, how do we prioritize them given our strengths and weaknesses? Where can we get the greatest return on our human and financial investments?
Threats – Which of the threats against us are most likely to derail our business; how do we minimize or counter these threats; what can we do to get out of the line of fire?
SWOT Analysis Example
Following is a SWOT analysis that Fusion Marketing Partners facilitated for a client that was having a problem with poor marketing and sales alignment. The outcome was a more productive and focused marketing organization.
Note: this article was excerpted from the book: Winning B2B Marketing