Financially Responsible Marketing

What sets your organization a part? Find out how to answer that question now.

Posted by on Jan 31, 2014

Do you know what powers your organization possesses that counter your flaws and create new prospects that minimize your biggest risks?  In this next step of developing your marketing plan, after examining your situation, it is time to move on to the next planning step in your marketing plan: Developing a SWOT analysis.

What is a SWOT Analysis and Why Should You Use One?

SWOT is an acronym for Strengths, Weaknesses, Opportunities and Threats. A SWOT analysis assesses both the internal environment with regard to its Strengths and Weaknesses and the external environment in terms of its Opportunities and Threats. Additionally, your firm should assess the opportunities and uncertainties of the market place due to changes in cultural, demographic, social, technological, economic, and political forces (CDSTEP).

A SWOT analysis is designed to help determine areas in which the organization is strong and can compete effectively and areas where it is weak and vulnerable to competition. It also enables you to understand where you have a sustainable competitive advantage that cannot be easily copied by competitors and how you can leverage those advantages in response to new opportunities arising from changes in the external environment. By clearly understanding your firm’s competitive strengths and weaknesses, you will be better positioned to address weaknesses and deal with threats arising from the external business environment.

The specific elements assessed in your SWOT analysis chart will depend on the nature of your firm. However, general areas to consider for internal factors include a critical assessment of the firm’s human and physical resources, capabilities, financial situation, activities and processes, and past experiences. On the other hand, it is also important to conduct a careful analysis of changes in the environment and understand how they affect your business, whether they represent threats or opportunities.  For example, is the population aging? Are there any political or regulatory changes in place that will affect your business? These opportunities and threats are outside of your control, but it is important to decide how you are going to respond effectively. Developing a full awareness of your situation through SWOT can help make strategic planning and decision-making much easier and much more effective.

The major benefit of developing SWOT is to help you move outside the box and overcome any constraints or limitations that may have hindered you before. SWOT reminds you to build on your strengths, minimize your weakness, seize opportunities and counteract threats. Recognizing the positives and negatives of your situation is the first step to conquering them. It puts you in a more powerful position for action; a greater chance at a successful marketing mix, and it will support the objectives and mission you have already defined.