October 16, 2014 1 Comment
This quantitative approach to SWOT was developed by Terrence Metz while at the Kellogg School of Management, Northwestern University. Traditionally, SWOT is a narrative method for describing a current situation. It is typically used in strategic planning, but it also is used in product development, annual planning of projects, or current situation analysis. We have used the following quantitative approach whenever you are faced with prioritizing among hundreds of options.
The following is a simplified approach.
In our FAST curriculum, we explain quadrant analysis, baselining, temporal shift, group personality, and other esoteric factors.
SWOT analysis begins by defining each of the four areas – Strengths (what a group controls and does well), Weaknesses (what a group controls but does not do well), Opportunities (situations, events, etc., outside control of the group that provide unique opportunities for growth, change, etc.), and Threats (changes or competitive forces that may adversely impact the group). Brainstorm each list separately. Analyze each list (PowerBalls is a good tool here) to prioritize to about six of the most significant factors each.
Build a matrix (see illustrations below). Opportunities and Threats on top with Strengths and Weaknesses down the side. Explain the scoring process to the group. Each member gets “9” points (it is an arbitrary number and you may change it if you want more or fewer points). They assign the points based on the impact or leverage that each strength or weakness has relative to each opportunity or threat. The higher the impact, the higher the number. Ensure that they don’t just spread them evenly – it should be based on a business understanding. Collect the scoring. Using a spreadsheet (alumni may download), calculate the final scores for each intersection, each column, each row, and each quadrant.
Review the scores with the group and highlight the quadrants, rows, and intersections with the highest scores. Summarize from the list and have the group convert the most impactful concepts into a narrative action plan.
One Person Example
A fictitious software company employee looks at its strengths as: experience, good people, creative ideas, and product integration. Its weaknesses are newness to market and development time. Opportunities are integrated products, new market, and extensive market research data that is available. Threats are recession, other large competitors (eg, Microsoft), and hardware manufactures. The one person may scores it as follows (scored from 1 to 9, with 9 indicating greatest impact):
The scoring indicates the most important strengths are their product ideas and integration. The weakness making them most vulnerable is their development time. The most favorable opportunities are integrated products and growth of computer use.
Strengths matter if they help take advantage of an opportunity or fend off a threat. Weaknesses matter if they prevent a group from taking an opportunity or making them vulnerable to threats. Opportunities require some strength to take advantage. This matrix helps to highlight which strengths, weaknesses, opportunities and threats require strategies.
Eleven Person Summary
Here is a real life example with eleven participants. Note that the moderate strengths and weaknesses had little or not impact on the plan. Participants largely weighted their most significant strengths and weaknesses to develop actions.
Quantiative SWOT analysis helps focus future efforts – products, projects, strategies, and actions. It takes a few hours to complete, but it is worth the effort.
Let us know what you think by commenting below. For additional methodology and team-based meeting support for your change initiative, refer to “Change or Die, a Business Process Improvement Manual” for much of the support you might need.
Become Part of the Solution, Improve Your Facilitation Skills
The FAST curriculum on Professional Facilitation Skills details the responsibilities and dynamics mentioned above. Remember, nobody is smarter than everybody, so consult your FAST Facilitator Reference Manual or attend a FAST professional facilitative leadership-training workshop offered around the world (see MG Rush for a current schedule — an excellent way to earn 40 PDUs from PMI, CDUs from IIBA, or CEUs).
Do not forget to order Change or Die if you’re working on a business process improvement project. It provides detailed workshop agendas and detailed tools to make your role easier and your team’s performance a lot more effective—daring you to embrace the will, wisdom, and activities that amplify a facilitative leader.