You must know your strengths if you want to win. As a project manager, you also need to know the weaknesses and risks of your project so that you can prepare early enough. A SWOT analysis can help.
Seams that our Projectix was a bit too relaxed with it and now, Bigboss is fuming. Let’s see if and how Projectix can sneak out of that.
You always run the risk of being caught with your pants down if you don’t know where exactly the strengths and weaknesses or the risks are which are awaiting you in the world out there. As project manager, it is your job to deal with this topic and notably to know beforehand when and where the clouds are gathering. This might be slightly uncomfortable, either because you’d prefer to close your eyes or because you fear the rage of the boss. But omitting it does not help because it’s gonna bite you in the ass later on. Believe me! So, what exactly is a SWOT analysis and how to do it correctly?
What exactly is a SWOT analysis?
SWOT is a English acronym and consists of the following words: Strengths, Weaknesses, Opportunities and Threats. And the SWOT analysis is the technique to identify them.
The SWOT analysis differentiates between internal and external factors. Strengths and weaknesses are internal factors which can be corrected or fostered by the team or the company itself. On the contrary, opportunities (or chances) and threats (or risks) are external factors, taking effect on the project from outside the organisation and cannot be influenced by the team or the company.
We have created a Word template for your next SWOT analysis. Download it right now:
It is the task of the project manager and his team to analyse all areas of the project and to list the vital aspects in all 4 sectors.
How to do a SWOT analysis correctly?
This is a good question and I always find it very difficult. That is to say that there are quite some problems with the letter “W”, the weaknesses:
- It is important to lay open the weaknesses so they can be resolved by the team or the company or whoever is concerned.
- You must formulate in a way that you don’t step on someone’s toes to avoid that he or she refuses to cooperate with you as a matter of principle. Especially CEOs and supervisors can be thin-skinned. And last but not least, you don’t want to run the risk to get fired for a correct but brutally honest analysis. This is the problem our dear Projectix sees coming up.
As project manager it is your responsibility to list all relevant points. If you omit something, you can be sure there will be someone later coming around accusing you that you should have told it earlier and that you should have known it from the very beginning. Furthermore, you are responsible for the project’s success. To close your eyes here and now will not help you at all, quite the contrary. The more honest you lay open the threats at least for yourself, the sooner you can prepare for them.
How exactly does a SWOT analysis work?
My experience is that it’s best to work clockwise and start with the strength and then work round the diagram. Preferably with your team. Why with the team? Well, first of all, the more heads the more ideas you get. And second, if other problems showing up later in the project it will be much easier to motivate the troops to solve these problems having overlooked them together.
To begin with: How to formulate right?
In case you’ll have to present and/or discuss the SWOT analysis to your team or to the management later on, it’s important to formulate right.
- Formulate as neutrally and objectively as possible.
It is important to chose a wording as though you were talking about an event or a fact that does not affect you.
- Formulate using measurable data where possible.
- Don’t attack anyone personally and don’t mention names if you can avoid it. You can name somebody verbally in the meeting if needed. A personal attack doesn’t pay. And who knows, perhaps you’ll need a helping hand exactly from that person one day?
- Don’t be too euphoric nor too negative. When describing a chance too euphorically or even as being probable, everybody will expect it to happen. And when then it does not happen, the weeping will only be louder. This is also called “commercial prudence”. If on the other hand, you describe weaknesses and risks too negatively, then you run the risk your description being considered as overdrawn will be rejected and the whole point deleted.
The S for Strengths
We start the SWOT analysis with the strengths to create a positive atmosphere. The team lists all the strengths and feels good about it. Strengths are all the things that are under your or your team’s direct influence and that take a positive effect on the course of the project. For example:
- special skills of individual team members or the entire team, as for example experiences or knowledge or that some of the team members have done a similar project successfully before
- competences but also organisational conditions at your company or subcontractor, for example an especially good collaboration between project manager and sales or a supplier who has already accompanied a similar project or part of the technology already exists and is well tested in the company
Examples for formulation:
bad: The project will definitely be successful as 3 out of 4 team members have already done a similar project with success last year.
good: 3 out of 4 team members have done a similar project with success last year. The current project can benefit from the know-how transfer.
bad: The budget is luxuriously calculated.
good: The project has been granted with a budget including a 10% buffer for unplanned costs.
All you and your allies cannot influence directly, like weather or politics for example, belongs to opportunities (chances) and not to strengths.
The W for Weaknesses
Now, it’s the moment to lay open the weaknesses pitilessly but as neutrally and objectively as possible. Why as neutrally and objectively as possible? Because here you aim not only to get clarity about the weaknesses for yourself but also to motivate those who could cure them to do exactly this. For example to persuade the production manager to designate a project team member quickest possible.
By the way, I was very successful with the following method: Before presenting my SWOT analysis to the entire management group, I discussed the open points under weaknesses with each concerned manager discretely. Very often, we came to an agreement this way because the department manager did not want to justify himself in front of the entire management.
So, here again, we list all points within our direct or indirect influence, only this time those with negative impact on the course of the project. For example:
- absent team members or training needs for some of the team members
- communication issues within the organisation (like between subsidiaries in different countries)
- missing equipment, software and so on and so forth
Examples for formulation:
bad: Mr Little has still not designated a team member for the production planning.
good: At the moment, no team member for the production planning is available.
bad: The budget is too low.
good: The project has been granted with a 3,000 Euro budget. As per the agreed investment plan, rather 4,000 Euro are needed.
The T for Threats (Risks)
Here, you show the external risks that could threaten the project’s success. The careful formulation is not so critical any more as nobody can feel attacked personally the threats coming from outside the company. Nevertheless, you should avoid wording that could indicate you are frozen like a deer in the headlights. Demonstrate that you can deal with. So, don’t sugarcoat or downsize, name things as they are, openly and honestly.
Threats could be for example:
- ongoing regulatory proceedings threatening the project’s basis
- public funds which are requested but not approved yet
- the weather conditions (for an outdoor project)
Examples for formulation:
bad: If the subvention is not approved by the city council, the entire project planning will fall apart.
good: In case the city council should not approve the subvention, other funding sources need to be found.
Now that we have done all negative points, we can finish with something positive so that we can all go home with a good gut feeling. Namely:
The O for Opportunities (Chances)
Opportunities (or chances) are all external factors fostering the project’s success or making the project even more successful than planned. When formulating this, you should apply the “commercial prudence” rule again. Name chances but avoid wording where a pathologically optimistic CEO immediately opens the champaign bottles. Otherwise, it will be difficult for you to explain when it does not happen the way you announced it.
Opportunities or chances could be:
- decreasing interests reducing your capital cost
- a market trend on the horizon
- a competitor in trouble
Examples for formulation:
bad: Thanks to the constant good weather in the region, we can safe on the costs for weather protection.
good: In case the weather is good, short-term savings on weather protection costs could potentially be realised.
And now, what will I do with the results of my SWOT analysis?
As always, everything you do must aim to not only produce paper or a nice presentation but mainly to foster the project’s success.
As soon as the winds calm down, take your SWOT analysis to a quiet place and have a sound look at it again.
How do you want to take advantage from the strengths, yours or your team’s?
What can you do to circumnavigate the weaknesses or perhaps even use them for the profit of the project?
Concerning the threats, what could you do when they eventually happen? Are there possibilities to exert any influence? Can you already do something here and now to eliminate a threat?
How will you use the opportunities/ chances? What will really come out of it should they happen as assumed? Can you take some influence on the course of these things to raise their occurrence probability?
By the way, threats and opportunities will be part of your risk register and then you need to have an even closer look at their possible impact on the project cost and time-line.
Integrate the results of these thoughts into your mind-map, your task planning, your project plan, your risk register or your agenda and you will be armed against all contingencies. Perhaps not ALL of them, but certainly much better than without a SWOT analysis. But keep in mind, you are project manager, and in projects, there are always surprises and nobody can think of everything. And a bit suspense from time to time spices a project manager’s life … 😉
Now it’s your turn!
You can train the SWOT analysis technique in your daily business. Chose a small project and try to do a SWOT analysis as described above. If you don’t find a small training project in your business, take one from your private life, the next holiday trip for example. You’ll be surprised how simple it is to avoid some of these little troubles by just thinking it through beforehand. It may just be that you are prepared next time.
Want an example? Your SWOT analysis could show that a threat for your pick-nick is it could rain. Now that you know the risk, you can look up where the next shelter is located and you can react if ever it should actually rain. Your family will be very grateful.
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