The best managers regularly stop staring at their belly buttons to raise their heads above the paperwork and spreadsheets for a glimpse at what’s going on outside of the office. We, too, should take a few moments to take a look at our map and not just stare at the road just beyond the front bumper. Strategic planning is a given in the business realm and one of the standard tools used in strategic planning is a SWOT analysis.
Strengths, Weaknesses, Opportunities, Threats
SWOT is an acronym for Strengths, Weaknesses, Opportunities, and Threats and is a very useful tool for managers looking to effectively plan and strategically achieve business goals. Strategic planning is just management lingo for long term future planning and it’s concerned with time horizons stretching out from one year to five years or longer.
We can also use SWOT analysis to help us reach our personal goals and in particular, our personal finance goals. So how does SWOT work?
Your SWOT analysis can be environmentally based (internal — strengths and weaknesses, external — opportunities and threats) or time based (now — strengths and weaknesses, future — opportunities and threats).
First, we examine our strengths so we can capitalize on them:
- What are you good at? Budgeting? Planning? Negotiating?
- Are you strong in areas such as building relationships or recognizing opportunities?
- Do you have a frugal mindset? Do you make every penny count?
- Is your self discipline second to none?
- Does the thought of investing get your motor running?
- What’s your track record in personal finance and debt?
- Do you understand insurance and taxes?
- Are you a saver or a spender?
No matter what your personal strengths may be, you must capitalize on them. How can you use them to your advantage? The key is to use and develop those strengths that others may not possess. If you’re great at negotiating use it! Haggle for your car, your mortgage, or even your lunch! If you’re great at setting up and living within a budget, enjoy it and revel in the fact that you know where your money is going. If you’re always putting every thin dime into a savings account, don’t let someone make you feel like a Scrooge, you’re just capitalizing on your strength!
Know your strengths and use them to your full advantage. Embrace your strengths because tomorrow, we’ll talk about Weaknesses.
photo credit: Madrigal Photography
[tags]strengths, weaknesses, opportunities, threats, money, personal finance, personal productivity, goals, business, SWOT, discipline[/tags]
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This kind of analysis is still used and taught in Universities. We took a look at it a few months ago. It’s a great starting point for checking out new markets or preliminary weaknesses/areas of opportunity in your niche.
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