By Andrew Krouse
VP, Commercial Banking Officer
My advice to prospective entrepreneurs and business owners is to start preparing your SWOT analysis annually. The SWOT can be associated with self-reflection of your business model. Business is challenging and continues to become more difficult with innovation, politics, and competition. To quote Dennis Hopper in Hoosiers, “Don’t get caught watching the paint dry!”
Defining Your S.W.O.T.
Strengths and weakness are frequently internally-related, while opportunities and threats commonly focus on the external environment. The name is an acronym for the four parameters the technique examines:
• Strengths: characteristics of the business or project that give it an advantage over others.
• Weaknesses: attributes of the company that place the business or project at a disadvantage relative to others.
• Opportunities: elements in the environment that the business or project could exploit to its advantage.
• Threats: factors in the environment that could cause trouble for the business or project.
What a SWOT Analysis Can Do for Your Business
The SWOT analysis allows entrepreneurs to start examining all viewpoints of their business model. The SWOT exercise should be completed with your management team with plenty of time for discussion. Allow each member of the management team to focus on the SWOT of the company business model in an open forum scenario. I firmly believe that understanding/practicing the SWOT analysis will help develop strategic advantages to your company by breaking down the good, bad and the ugly aspects of your business model.