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Want a better business? Invest in SWOTing

Organizations that go through the strategic planning process typically engage in what is known as SWOT analysis. SWOT is the acronym for strengths, weaknesses, opportunities and threats.

In this column we will discuss analysis of weaknesses and threats and why failing to adequately identify and discuss weaknesses and threats just might itself be one of the biggest threats to an organization.

Over the past 15 years, I have had the opportunity to facilitate numerous goal-setting and planning retreats for many types of organizations — chambers of commerce, economic development organizations, schools, state agencies, corporate boards, local governments, nonprofit groups and even churches. Reflecting on that experience and reviewing recent articles on business and systems failures has led me to conclude that identifying weaknesses and threats is more important than most of us realize.

The conventional wisdom in SWOT analysis is that weaknesses are internal and threats are external. While this may be more about semantics than anything else, I believe that threats can be external and internal. An example would be that of an employee who attempts to sabotage a business by selling trade secrets or by intentionally causing damage to sensitive information technology resources. But let’s not get caught up in classification exercises. Three recent national examples illustrate the consequences of failing to deal with threats and weaknesses in organizations.

Writing in the February 2005 issue of FAST COMPANY magazine, Jena McGregor points out that the September 11 tragedy, NASA’s Columbia explosion and the Jayson Blair episode at The New York Times are examples of organizational failure. By studying these cases, we can learn a lot about organizational weaknesses and threats. In each case, it seems that there were three factors that led to disaster — imagination, culture or communication.

In the 9/11 case, a failure to imagine that Al Qaeda could pull off such a feat as flying a plane into a building was a factor in the disaster. In the NASA case, the organizational culture was “…as much to do with this accident as the foam,” according to the Columbia Accident Investigation Board. In the Jayson Blair case, “a failure to communicate — to tell other editors what some people in the newsroom knew — emerges as the most consistent cause, after Jayson Blair’s own behavior, of this catastrophe,” according to a report mentioned in McGregor’s article. In hindsight, the red flags were flying high in the above cases.

So, what about your organization? Are there red flags flying that you refuse to see? Are there employees trying to get some information to the top that mid and senior managers simply refuse to believe, and therefore won‘t pass it up the chain of authority? Does your organization encourage open discussion and so-called outside-the-box thinking? Does your culture limit imagination? These are legitimate questions and they can be discovered by a proper SWOT analysis.

Your organization does not need an outside facilitator to guide it through a SWOT analysis (although that is very helpful). You can take a moment right now and make your own lists of weaknesses and threats. After you do so, ask several other people in your organization — at different levels in the organization — to do the same thing. Have them do it anonymously so that nobody feels pressured to give you what they think you want to hear. You might want to simply have them write on an index card and return it to a neutral place. After you receive the cards compare them. If you see that there are major differences in the listings, it is time to dig deeper to find out why one part of the organization sees a certain thing as a weaknesses while another part does not. But don’t forget that what is seen as a weakness in the mailroom may not be seen as a weakness in the accounting department. Perspective must be taken into consideration

Finally, don’t be afraid to talk about weaknesses and threats. Sure, it is much more motivational and invigorating to talk about the positive things. And those positive things should be talked about. Who wants to work in a “can’t do” organization?

Another way to think about weaknesses and threats is to ask the question, “What can we do better than we are doing now?” After all, you don’t want your organization to be a case study on organizational failure.

Happy SWOTing.

Phil Hardwick’s column on Mississippi Business appears regularly in the Mississippi Business Journal. His e-mail address is phil@philhardwick.com.

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