In a multimedia environment, with multichannel two-way access to the consumer each operating at over-capacity, potential access to all consumers, literally millions of people, each demanding a one-to-one dialogue, on their terms, with ever-decreasing attention spans, an increasingly demanding savvy consumer about whom we can know more than we can ever use, operating in real time, it is tempting to allow oneself to be overwhelmed by the complexity and sacrifice constructive business development in the process.…
In the face of such complexity and uncertainty it can be tempting to join other companies in marking time and await a return to normal, where familiar patterns emerge and the normal management tools can be applied, in slow motion… In the current climate, with a probable five years of flatline demand in view, a more pragmatic approach might be to face up to reality and attempt to make sense of the here and now, seeking opportunities while competitors remain on hold…
Another temptation can be to discard old tools in favour of new approaches designed for unprecedented times. This is a waste of time, given that since this particular global wakeup call has no precedent, the new tools have yet to be developed.
In fact, it can be more productive to adapt old-established tools like SWOT analysis to this new business environment. Because SWOT is spelled that way, users tend to start with Strengths, attempt to eliminate Weaknesses, explore Opportunities and obsess on Threats, in that order.
However, in the current climate it can be more productive to apply the technique as OTSW, based on the logic that Opportunities and Threats are outside the business, are independent of it and transient, whilst Strengths are not absolute, but are relative to Opportunities. Threats are outside restraints that simply need to be factored into the exercise.
Weaknesses need not be terminal, but simply need their ability to dilute strengths constrained. Attempting to eliminate weaknesses takes precious time, and at best creates a ‘perfect’ organisation for an opportunity that has moved on…
In uncertain times, whilst Opportunities tend to be accessible within increasingly short time frames, they still tend to fall into one of four boxes: selling more of the current products to current users, introducing new products to current users, identifying new potential users that have similar profiles to existing users in the hope of selling them current products, and finally attempting to sell new products to entirely new consumers. The emergence of the savvy consumer simply means that all products have to be able to represent demonstrable value-for-money in order to qualify for repeat purchase.
These unprecedented times have heightened the risks associated with Threats in the market place, but Threats still fall into the following categories: Regulatory/Legal/Political developments, Cultural/Social change, Technological change, Trade concentration /power/internationalisation, and Competition (innovation/substitution/wealth/ risk-policy). Here it is vital to focus on the real restraints affecting pursuit of the opportunities and factor them into product strategies, but do so fast enough to avoid missing the opportunity.
Only when Opportunities and Threats have been identified and prioritised is it appropriate to assess Strengths of the company. In practice, Strengths can include Brands, Money and financial backing, Marketing Personnel, Sales Personnel, Production facilities, Research & Development, Logistics facilities (outsourced help), Agency network, Back-up systems and tools.
Given that a Strength is defined by a market opportunity, it must be measured against its ability to help capitalise on that opportunity. In other words a Strength is only effective if it is capable of helping to realise a given opportunity. By this definition, any other ‘strengths’ or attributes of the company obviously become redundant and need to be eliminated, fast, in order to optimise opportunity response-time.
Weaknesses are simply those aspects of the company’s goods or services that are so out of line with market need that they dilute company strengths. Here, especially in the current times, the answer is not to waste time attempting to make them perfect but simply reduce their ability to damage the main offering.
SWOT (or rather OTSW) analysis probably represents one of the most pragmatic means of dealing with the current market conditions.
All it requires is objectivity, market-driven assessment and a willingness to face up to reality, before the market does it on your behalf….
