One of the classic consultant?s tools in helping businesses determine their forward planning is the SWOT Analysis. Many readers here are familiar with the concept, but I?ll reiterate it here (materials from Wikipedia):
- Strengths: characteristics of the business, or project team that give it an advantage over others
- Weaknesses: are characteristics that place the team at a disadvantage relative to others
- Opportunities: external chances to improve performance (e.g. make greater profits) in the environment
- Threats: external elements in the environment that could cause trouble for the business or project.
Yesterday, a Certified Professional Services Marketer (CPSM) member of the Society for Marketing Professional Services (SMPS), posted this question on the internal members? listserve. (This method of communication has largely gone by the wayside in the social media era, but still is quite effective for closed groups.)
In your experience of conducting a SWOT analysis as part of a strategic planning process, who have you included to participate in the analysis? I?m interested in other firms? experience and POV?. I?ve managed to persuade my firm?s principals that we need to conduct a SWOT, and I had the concept that not every single person in the firm participate (there are 28 of us), but that we have some criteria governing who is invited based on experience, client contact, knowledge of our industry and competition, etc. If you have done at SWOT at your firm, how have you determined who participates?
This question raises one of the fundamental challenges of business planning and goal setting. Who should be invited to participate in the process? In most organizations, of course, the decision-making is top-down, sometimes in the hands of one individual. (The owner/president tells his executive team what to do, and they pass the orders down the line.)
Deborah Briers responded with these observations:
A SWOT analysis is a tool that requires brutal honesty at times and will suffer from political correctness. When I have conducted SWOT analysis in the past as part of a strategic business planning process, I usually prepare it on my own prior to presenting it to the top management of the firm. It requires research in order to have a solid understanding of your competition. You also need to research market conditions and segments in order to bring forward a good understanding of the opportunities and threats.
Weaknesses is the section that often requires soul searching. For instance, if you have a market sector leader who isn?t pulling his weight, that needs to be discussed. If your firm hasn?t implemented BIM into your design process a serious discussion about shifting resources may be in order. If a particular market segment championed by people in your firm doesn?t have enough demand to justify on-going pursuits, then you need to be willing to pull the plug.
If you and your executives want to get input from employees to make them feel like they are part of the process then send out a questionnaire in advance asking them their opinions on the strengths, weaknesses, opportunities and threats to the firm. Keep it in simple terms though. Ask them questions like: What do you think our firm?s greatest strength is? How do you think we can improve upon our project delivery? Who in your opinion is our greatest competition? Are there any areas where you think we need to provide more training or resources in order to better enable you to do your job? What do you like best about working here?
Once you have a solid grasp of the SWOT and have summarized employee survey responses then meet with your top level management team ? whoever would be normally involved in the business planning process. It is helpful if you provide them with the ground rules and an explanation of the process in advance so they can get their thoughts in order and the meeting can be very productive. You can start with a blank slate (white board, sticky presentation pads) and brainstorm with them, filling in your findings at the end if something was left out. Or you can provide them with your analysis as a starting point for the discussion and get their input.
Be brave! Sometimes it can be a good idea to get some external input if you are facing tough decisions or topics. Don?t be the only person to convey bad news. For one such evaluation at a firm I worked with previously, we conducted face to face interviews with our top clients, asking them about what we did well and what we could improve upon. Also ask them about their perception of your firm as it relates to the competition. This can really help you define your competitive advantage. If you haven?t gone through this process before it might be worthwhile to involve a facilitator. This will cost money but will ensure that you get the kind of information needed to make subjective business decisions opposed to sticking with the same old thing because emotions run high.
Consultant Bernie Siben makes note that supposedly democratic SWOT analysis processes may not be what they seem to be ? especially if subordinates and employees are afraid of reprecussions for speaking what they really feel, at least in the direct presence of their bosses.
I mean no offense to Deborah Briers because I think the components of the SWOT analysis and planning efforts she has described are dead on. I also agree with her that you have to have a way to take the ?political correctness? ? and the fear of criticizing ? out of the process. However, I really believe that a SWOT analysis prepared by one person misses too many ideas on each page (S, W, O and T) because it is built on only one person?s perspective. That said, I think that with a firm as small as 28 people, you can include everyone in the analysis.
HOWEVER, I think you should take the time to do the analysis twice ? the first time with no owners, officers or division/department managers in the room. That will give you a true picture of how most of the firm sees things ? without the ?political correctness? pressure that would be imposed if owners and managers were there. As you do the analysis, write the strengths, weaknesses, opportunities and threats on big Post-It notes, but do not put a person?s name next to any idea. When the analysis is done, take the pages down, put clean pages up, invite the owners, officers and division/department managers to join the group. The ways the analysis could change in round two will tell the firm a lot about its culture and whether people feel safe offering criticism.
For example, I know of a firm that went through a very ?hairy? acquisition. The people from both firms were convinced their owners had sold them out, and all the talk around the halls painted a very negative picture of the owners/managers. However, when the SWOT analysis was done (with everyone in the room), the first item brought up for the ?strengths? page (by someone who was not an owner or manager) was the firm?s senior management. That was a great example of ?political correctness? and fear governing the process.
Use the second SWOT analysis to continue with your planning process. When the day is done, share the pages from the first analysis with the owners, officers and division/department managers. If possible, get the group in a room and put both versions up on the wall, next to each other. If staff members are afraid to criticize, the leaders need to know. If people see a weakness in what leaders want to consider a strength, the additional perspective could be very helping in identifying where the firm suffers from a ?do as I say, not as I do? kind of mentality, or a place where their own prejudices and biases have put blinders on them.
The fact is that the markets have been topsy turvy for the last few years. A new employee, who doesn?t know which ideas you discussed and rejected last year, will not be as afraid to bring those ideas up. And there will be some ideas you might have rejected a year or two ago that would be perfect to deal with what the economy has become. Also, it is good to get the perspective of the people who actually DO the work, in addition to those who manage the projects or are administrative managers of divisions, departments, etc. In addition, new staff members who have come from other firms, as opposed to those just out of college in their first engagement, may bring you new and workable ideas based on how their old firms dealt with an issue.
Finally, you know who the people are in your firm that you think will be the next generation of leaders. Including them in the planning process gives them a stake in their own and the firm?s future, and lets them know that they are already being considered for bigger and better things. This will help your firm with retention of your best employees.
The challenge of gathering truthful perspectives about an organization?s strengths and weaknesses, opportunities and threats, is that the truth is sometimes unpalatable (at least to the people in power) and, of course sometimes it is invisible or disguised under other forces. In business, we tend to look for successful role models ? and sometimes we pay hefty fees to consultants to tell us what we need to know (and sometimes, worsse, we pay these fees to hear what we want to hear.)