Sigma Magic Help Version 17

SWOT Analysis

Overview

SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis is a structured approach to evaluate the four elements of a company, product, place, industry, or person. It involves specifying a project's objectives and identifying the internal and external factors that are favorable and unfavorable to achieve those objectives.

• Strengths refer to the characteristics of a business or project that give it an advantage over others.
• Weaknesses refer to the characteristics of the business that put the project at a disadvantage over others.
• Opportunities refer to external environmental factors the project could exploit.
• Threats refer to environmental elements that could hurt the project.

SWOT analysis aims to identify the key internal and external factors critical to achieving the given objective. SWOT analysis can be used to build organizational and personal strategies. One way is to use matching and converting. Matching is used to find a competitive advantage by matching the strengths to opportunities. Another tactic is to convert weaknesses or threats into strengths or opportunities (for example, find new markets). If a threat or weakness cannot be converted, a company should try to minimize or avoid it. The company could choose an aggressive strategy if there is a strong relationship between strength and opportunity. At the same time, if there is a strong interaction between weaknesses and threats, the company may use a defensive strategy.

Inputs

This tool can be added to your active workbook by clicking on Change and then selecting SWOT Analysis. Click on Analysis Setup to open the menu options for this tool.

Setup

A sample screenshot of the setup menu is shown below.

1	Analysis Type: Specify the tool format for this analysis. This selection is not enabled since there is only one format available.
2	Num Rows: Specify the number of rows on the tool. Currently, this option is fixed and not changeable.
3	View Example: Click on this button to add an example worksheet. You can use the example to understand how others have filled out the tool or use the example as a starting point and modify it to meet your needs better.
4	Help Button: Click on this button to open the help file for this topic.
5	Cancel Button: Click on this button to cancel all changes to the settings and exit this dialog box.
6a	Create Button: Click on this button to save all changes and update the worksheet layout.
6b	OK Button: Click on this button to save all changes and compute the outputs for this analysis.

The worksheet consists of four quadrants: one for strengths, weaknesses, opportunities, and threats. You can review these with your cross-functional team and document all the factors on this worksheet. Make sure that your strengths and weaknesses refer to internal factors for the objective you are working towards, and opportunities and threats refer to external factors within the environment.

Checklist

You will see the following dialog box if you click the Checklist button. The checklist contains a few pointers on things you must pay particular attention to while performing this analysis. The checklist has been derived from experience working on past projects. Not all the checklist items need to apply to you. However, you should carefully review the checklist and apply any recommendations that make sense for your project. Make sure to read each checklist item and mark it as completed after you have read and taken actions as appropriate for your project.

1	Item: The items on the checklist are listed on the left
2	Status: The status of whether the checklist has been answered is listed on the right. If all the checked items are okay, the status image in the header will show a green checkmark. If any checks fail, then the status image in the header will show a red cross mark.

Ideally, all items on the checklist should be marked as reviewed/completed.

Verify

If you click the Verify button, the software will perform some checks on the data you entered. A sample screenshot of the dialog box is shown in the figure below. The software checks if you have correctly specified the input options and entered the required data on the worksheet. The results of the analysis checks are listed on the right. If the checks are passed, they are shown as green-colored checkmarks. If the verification checks fail, they are shown as a red-colored cross. If the verification checks result in a warning, they are shown in the orange exclamation mark, and finally, any checks that are required to be performed by the user are shown as blue info icons.

1	Item: The left-hand side shows the major tabs and the items checked within each section
2	Status: The right-hand side shows the status of the checks.
3	Overall Status: The overall status of all the checks for the given analysis is shown here. The overall status check shows a green thumps-up sign if everything is okay and a red thumps-down sign if any checks have not passed. Note that you cannot proceed with generating analysis results for some analyses if the overall status is not okay.

Outputs

Once you have answered all the data on the worksheet, click on Compute Outputs to update the conclusions area. A sample screenshot of the SWOT analysis outputs is shown below. There are no specific graphical outputs to interpret for this analysis. If all the template elements have been filled out, you will get the following message when you click on the Compute Outputs button. You can review the statements of the impact in each of the quadrants and determine what actions you need to take as a business to leverage opportunities and strengths and address the weaknesses and threats.

Notes

Here are a few pointers regarding this analysis:

• You cannot directly modify the checklist since it is built into the program. You must contact the helpdesk if you need any changes in this checklist, and they can update this list for you.

Examples

The following examples are in the Examples folder.

1. Perform a SWOT analysis for the new product your company will launch (SWOT 1.xlsx).

References

For more information on this topic, please refer to the following articles. Do note that if any external links are mentioned below, they are for reference purposes only.

• SWOT Analysis: https://www.thebalance.com/swot-analysis-for-small-business-2951706

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