Is your business currently sick but you are unaware?
You have consistently sacrificed your time, comfort, sleep, resources, and much more for that business, but ignoring this one thing could lead to waking up months or years down the line to a dying business.
This is not me trying to raise an unnecessary alarm, statistics show that approximately 20% of new businesses fail during the first two years of being open, 45% during the first five years, and 65% during the first 10 years. Only 25% of new businesses make it to 15 years or more.
There are many businesses closing down especially during this disruption we are facing globally. But it is not all gloom. There is something you can do to put your business among the 25% of businesses that stand the test of time and flourish even in the midst of disruption. I want your sacrifice on your business to pay off, I want your business to pivot even in these precarious times. It is possible!
Conducting a SWOT analysis is the tool you need to know the health of your business and to work out a comeback for your business if you have been negatively affected by the pandemic or you simply want to pivot at this time.
SWOT analysis is an acronym that stands for:
S - Strengths
W - Weakness
O - Opportunities
T – Threats
It is a simple tool that helps a business to better understand both its internal and external environment, which will in turn help in creating informed strategic plans that consciously leverage strengths and opportunities, and mitigate against threats while minimizing weaknesses. With a lot of changes that have happened in the business environment, it becomes imperative to get a better understanding of your business and reposition your business to thrive.
Let’s get started!
To get started, you will want to identify what your strengths are. What does your organization do really well? What one thing do you have and do better than your competitors or colleagues in the same industry, what processes or systems do you have that make you unique and make you stand out?
At this stage, it is very important to not take for granted the seemingly little things.
The things you think are not significant because you do it with ease, do not come so naturally for others. The crisis is in reality a dangerous opportunity. In the midst of the hit your business might have had, there is that one thing that you do better than others, that you can leverage on to scale amidst the current disruption.
Do you have happy employees? That could be your strength. You can leverage that to make your business pivot. When people patronize businesses, they do not do so because of the product or service functionality alone, they do so for many other reasons, for instance, the ambiance of a place, courteous staff, etc. And this makes it possible for all businesses in an industry to still scale and be a preferred choice because there is that one thing that each does better than others. The key is identifying it and leveraging it.
How do you discover your strengths as a business? Think deeply, ask employees, customers, and all stakeholders for their feedback on what they feel makes you stand out from others, and why you are their preferred choice.
Look deep into your business, what are the lapses, are there any weaknesses in systems, people, and processes?
It is important to be very honest here. For some businesses, the weakness could be the business owner. The fear, lack of trust, and desire to be in charge of everything could be the clog in the wheel of your business, preventing you from creating a business with a self-correcting structure that can run on its own and renew itself in your absence.
For some businesses, the weakness could be the people. People who the owners are sentimentally attached to and have refused to let go of despite their inefficiencies. Think of what is not working and get to the root cause of it with brutal honesty. Because when things are brought to light and the weaknesses are seen for what it is, steps can be taken to mitigate this. In a discussion with a CEO of a company whose company was doing well but had the capacity to make in 3 months what it was currently making in a year, he kept expressing his desire and need to scale especially as a result of the pandemic, but from digging deeper, we realized that the weakness of the company was his fear of relinquishing access of certain part of the business to someone else, he wanted to scale but the fear was the clog. On identifying that, he opened up more on the specific fears and we were able to address these weaknesses and come up with strategies to mitigate them. Be honest and brutal in the assessment of your weaknesses as a business, also be open to radical candor from stakeholders of the business.
In reality, what is currently happening globally is not a loss but a transfer of wealth and only those businesses that can properly reposition themselves for these opportunities will be a beneficiary.
Think about this, before the pandemic, a facemask was probably sold for less than half the current price with very minimal demand. And all of a sudden, we have a significant increase in demand and price, with tailors as well cashing in on this to create a fashionable facemask. Now not saying you have to change your business product or service but the fact is that the losses in these disruptions are not exactly losses but they are actually making way for new opportunities that had never previously been in existence or been leveraged. Your responsibility is to apply due diligence in identifying the existing and emerging opportunities and aligning your business as a whole to them.
The next thing is to identify the external factors outside of your control that can negatively impact your business. This could be new government policies, economic factors, etc. There is a need to identify these so that you can be ahead and take steps against them. For instance, with the instability of foreign exchange, as a business, you might want to look into having your cash assets in more stable foreign currencies instead of your home currency. Also, with the instability in government policies, for example, if your business communicates more with its clients on social media, you might want to begin to think of getting more ways of contacting your followers and keeping them updated on your business. Such as getting their emails, contact numbers, and making use of digital marketing tools and solutions.
Conducting a SWOT analysis requires quality time and diligence in being thorough to carry out a swot analysis effectively. If you are unable to find the time to do so as a business owner or a business manager, due to your business schedules, there are professionals who are skilled specifically for this and can carry out a swot analysis on your business and help you reposition it for success. Contact a management consultant today if you are ready to ready to secure the future of your business and ensure its sustainability and success in this new decade of beautiful disruptions.