As product managers, it falls to us many times for various research projects. One such project is called a SWOT analysis. SWOT stands for Strengths, Weakness, Threats, and Opportunities. This type of analysis can also be thought of as an internal/external analysis, and the main purpose is to identify areas of performance, needed improvement, potential revenue, and possible roadblocks. Below you will find information that is relevant to you as you perform these tasks.
First, I will look at Strengths. This is an internal facing analysis, as you try to determine your team, and your company’s strong points. Some key questions to ask are:
1. Are there any specialized skills?
2. Is there anything you do better than your competitors?
3. How staffed and experienced is the team?
4. Do you have proper procedures everybody understands?
5. Do you have well defined short and long-term goals?
Have a brainstorming meeting with your team to gather additional perspectives. Also, try and verify strengths with details. Instead of putting down “we have a roadmap”, put “We have a 1, 5 and 10-year plan to capture market share via 3 new product launches, reduced pricing on existing products, and attending 10 additional trade shows.” Remember, any data shown must be verified, not guessed at.
Weakness is the second part of a SWOT. This aspect is one that is hard to do, as nobody like to admit they have a weakness, and when presenting it, people may get offended. To avoid this, use more generalities. Don’t say “design engineering takes forever”, instead insert a graphic on timelines showing target dates and completion dates and indicate that overall, we run 25% late based on estimated delivery dates. This alerts management there is a problem, and assigns responsibility to team managers to evaluate their process.
Some key questions to ask to discover weakness are:
1. Where are sticking points in our process?
2. What does the competitor do better than us? (their strength is your weakness)
3. How is our product received?
4. How efficient are we?
5. How timely are we?
6. What failures do we consistently have?
7. How many support calls do we get?
8. How is our quality control process?
As before, try to find correlations, and also find facts. A good SWOT is based off findings and research. Opinions should be kept to a minimum. Also, a SWOT is no place to try to assign blame. You want to always be a professional and avoid mudslinging. Of all the SWOT parts, this one has the potential to be harmful to the team, as blame begins to get assigned.
The next two parts are more external facing. Opportunities are typically outside facing, although you can apply it internally. It can go hand and hand with a weakness. If you see a process that is lacking, it can be listed under weakness, but you can then add the solution during opportunities.
What you are trying to discover is new markets, new ideas, new process, and new revenue means. This is the moving forward part. Some key questions could be:
1. What is missing from your product line?
2. What does the market need?
3. Where is the market going?
4. Is there a company with a technology you can purchase or partner with?
5. What need is not being addressed?
6. What new techniques are being used?
Opportunities is wide open and a chance to brainstorm.
Finally, I want to talk about threats. Threats exist in many forms, and can be found in the most unexpected places. This is what may hold back progress, change direction, or address upcoming changes.
1. Are there potential new competitors?
2. Are there market trends negatively affecting our niche?
3. Are there changes in policies or standards that favor our competitors?
4. Does our competitor have something unexpected coming?
Threats can be eye opening and need to be addressed as quickly as possible. Being left behind due to unexpected market changes can be damaging both short and long-term to not only your product line, but your company as well.
Product managers are usually the ones who perform SWOT analysis, although other divisions may do so as well. While they are typically performed on your company or division, nothing is stopping you from creating a portfolio where you do so on your competitors as well. At the very least maintain information on their Strengths and Weakness. The above questions are not meant to be all inclusive, but a good starting point for your company.
Next week I will go over something a little different, and examine Augmented and Virtual Reality, and their potential impact on product managers. Be sure to like, share and subscribe, check out my videos and other post.