Business Environmental Analysis - SWOT and PEST analysis

In order to succeed, businesses need to understand their strengths and where they are vulnerable. Successful businesses build on their strengths, correct weaknesses and protect against vulnerabilities and threats.

Just as important, they have an eye on their overall business environment and spot new opportunities faster than competitors. A tool that helps many businesses in this process is SWOT Analysis. SWOT analysis stands for Strengths, Weaknesses, Opportunities and Threats Analysis. The technique looks at where the company has an advantage compared to its industry and where it is weak.

To be effective SWOT analysis needs a methodical and objective approach. It is too easy for a company to look at itself - and fail to see any problems, or to see strengths that are not real. We can help combat this by providing a fully objective view - which can then be used to support and enhance your business and marketing planning.

We will help you

• audit your overall operations to identify problem areas and also areas of excellence.
• examine the risks posed to the business and the opportunities available.
• identify any business blindspots that may be preventing you from seeing what is really going on in your industry and business environment.

Using techniques such as value chain analysis we will seek out where you have a real competitive advantage, and through portfolio analysis we will let you know which product areas to develop and which to wind down.

Our methodology goes well beyond the traditional 2 by 2 grid favoured by elementary guides on how to do a SWOT. This is a subjective measure as it depends on management perception, with little quantitative input to back it up.

As a simple example:

Widgets Inc. sells the best widgets, with the finest tolerances and finish, in the market - at the same price as competitors. Widgets Inc may view the quality of their product as their key strength, and be proud that they have kept costs down in other areas so that the product can be sold at the same price as competitor company widgets. They may ignore that cost saving has meant that production runs take longer. If, however, customers do not care about the product finish, do not need precise tolerance levels, but do need rapid turnaround then Widgets Inc's emphasis on quality is actually a weakness. Instead of focusing on the customer need for a rapid turnaround they have concentrated on quality at the expense of production speed.

AWARE's analysis would highlight situations such as illustrated by this example.