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SWOT

SWOT

SWOT —the acronym for Strengths, Weaknesses, Opportunities & Threats— is used to (analyse or) define a strategy for an organisation.  Commonly, a SWOT-analysis is used to determine the best strategy to obtain a defined (& obtainable) goal (i.e. sell a product to a customer in a competitive market).  But it can also be used to re-orientate the strategy of an organisation (i.e. find a new market and/or product, define new mission).

Strengths & Weaknesses are properties of the organisation (i.e. internal factors);  Opportunities & Threats are conditions (i.e. external factors).

• Strengths:  internal factors of the organization that help to achieve the objective;
• Weaknesses:  internal factors of the organization that make it hard to achieve the objective;
• Opportunities:  external factors that help to achieve the objective;
• Threats:  external factors that make it hard to achieve the objective (i.e. damaging to the business performance).

Internal factors include:  People, Products (& Price), Quality (perception), finance, manufacturing, …;
External factors include:  Market (competitors), Politics, Economics, Society/­environment, and Technology.

Application of SWOT is either to exploit the match of strengths with opportunities (create the winning combination of product/­price/­conditions), or to ameliorate weaknesses, or at least minimise the threats/risks, and preferably find the strategy to convert threats and/or weaknesses into opportunities (e.g. finding new markets and/or products).

Note that a SWOT analysis is a usefull tool, but other tools (e.g. ROI) should also be used before embarking on new projects. 

Effectuation

Developing a strategy seems a good way to face the future.  However, conditions change and unexpected events may cause the choosen strategy to be less appropriate.  Such events are considered a threat to the strategy.  Of course one can adapt the strategy, but there is also a completely different approach.  Seemingly, it goes without any strategy but that is not entirely true:  the strategy is just to exploit every event.

Bird in the hand

Don't wait for the opportunity to occur, or the brilliant idea/­product.  But look at what you have, and what you can achieve with that.  Analyse the available means and advantages (money, rights, specific clients, stakeholders, experience, image, networks).  It is not like a chef cook who first decides on a menu and than tries to acquire the ingredients, but like the chef effectuator who looks to what is available and how to make a nice meal out of that.  It is nice to dream about the ten birds in the sky, but look at the bird in your hand.

Affordable loss

Commonly, everybody looks at what can be gained with a particular venture.  However, it is much wiser to look at what you are prepared –or can afford– to loose.  If that is ok, go for it.  It also avoids that plans are discussed and shelved again because the gains are too uncertain.

Lemonade

Tranditionally every sudden change in conditions –a 'surprise'– is considered a threat to the choosen strategy.  However you should consider it as an opportunity.  New developments and/or insights should be welcomed and exploited.  It is putting to use what you were not looking for ('serendipity'), or use it in a way it was not intended for ('axaptation').

Crazy quilt

Change the hesitant attitude for certainty to a more entrepreneurial one.  So no "we will think it over" but "let's give it a try".  Consider to work together with other parties/­stakeholders ('co-creation'), and don't spend time looking for the perfect combination.  It is like a quilt may people are working on;  there is no ultimate design to strive for but you get a nice result.  Start, and see how you can improve/­optimise along the way.

Pilot in the plane

This is about authorising participating members.  So don't give detailed job descriptions/­procedures/­agreements, but give a framework within which they are free to operate to their own vision.  Just as air traffic control is not controlling the exact path of a plane but allows the pilot to request an airway, management should not try to control every detail.  As a consequence the team responds very quickly, automatically and very effectively to changes in conditions.

The purpose of effectuation is not find a strategy for the future (which will have to be adapted time and again), but to create the future by exploiting every significant event.  And not to have absolute control over the team, but facilitate and empower the team members in their work.

Source:  Corporate Effectuation — Thomas Blekman.

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