Treat Your Finances Like A Business – SWOT Analysis: What are your weaknesses?

In yesterday’s post, we looked at SWOT Analysis: What are your strengths? and discussed how individuals can use business principles to help them control their personal finances like a business. We also discussed how a “SWOT Analysis” looks at strengths, weaknesses, opportunities, and threats. Today’s post is on Weaknesses.

181/365 Up all NightWhat is a weakness? A personal roadblock to achieving your goals. This might be an internal characteristic, or a timing issue. Either way, a weakness has the potential to derail you.

But before we get into our weaknesses, remember that strengths are important. Entire books are written about discovering your strengths and that IS an important part of a business or personal finance SWOT analysis. But several popular books say that “casting a critical eye on our weaknesses . . . will only help us prevent failure,” or “working to overcome weaknesses is a waste of time,” is a strategy destined for implosion.

If you’re weak in a area critical to your success, ignoring that weakness is foolish. For example, there are certain critical success factors in sales:

  • Prospecting – finding qualified clients
  • Establishing rapport – they won’t buy from you if they don’t like you
  • Correctly identifying problems – does your product or service really meet their needs
  • Skillfully presenting solutions – showing how your product does meet those needs
  • Answering objections – better termed “answering questions”
  • Closing the sale – obtaining commitment from the client
  • Following up – checking with the client on a regular basis

A chain is only as strong as its weakest link.

I read a story about a salesperson who examined himself in light of these critical success factors and realized that, while he always thought he was weak in Closing the Sale, he was actually weak in Prospecting. To overcome this weakness, he read every book he could find on the subject, attended every seminar that was offered, and started a Prospecting Journal to keep track of what worked and what didn’t. He decided to become a prospecting machine. What happened? He DID become a prospecting machine and because he had more prospects to work with, he was better able to ratchet up his skills in other critical areas. Soon he was asked to give speeches and seminars to other sales people in his firm. His profile within the organization and the industry became so great that he was later promoted to VP of Sales and Training. It all started with identifying his weakness.

So, our focus isn’t necessarily ON our weaknesses, it’s in KNOWING them. Why do you want to know your weaknesses? So you can either improve them or work around them! Where are you weak in terms of personal financial management? Are there some areas you can boost your knowledge by taking a class or reading a book?

Some folks are weak in areas of spending, so you’ll have to develop a personalized plan to work around that. Some are weak in falling for scams or get rich quick schemes. They will have to learn to recognize them and have a routine answer to avoid getting railroaded into attending a “meeting” at the Howard Johnson’s on a Thursday night. Others may be weak in budgeting, or understanding long term investing, or buying too much insurance, or frugality, or using credit cards, or eating out. You have to have a plan to either improve or work around those areas where you’re weak. And honesty is the best policy here!

If there is an area where you’re weak in the personal finance realm and you don’t want to or can’t take a class to learn more, what should you do?

1. Automate. Automatically deduct a set amount and deposit it into a savings account. If you don’t budget very well, you can automate that, too! Check out this video from Mvelopes.
2. Phone a friend. It’s ironic how people complement each other. Many times the areas where you’re weak will be strengths for your spouse or friend. The key is to listen to them, just like you want them to listen to you on those areas where you’re strong.
3. Read. Read blogs like The Wisdom Journal or any of those in my blogroll. These are some fantastic people who write great articles to help you make your life better. In particular, check out The Life Skills Network:

photo credit: stuartpilbrow

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