Quantitative SWOT analysis is the result of contrasting the internal, controllable aspects of the organization (ie, Strengths and Weaknesses) with the external, uncontrollable situational factors (ie, Opportunities and Threats) and then aggregating the numeric scoring of the actions an organization might take to reach its goals and objectives.
Qualitative situational analysis provides a poor method for building consensus. In what Dr. Tufte refers to as ‘flatland’, answers pop out at people, but not consensual answers. Therefore, the following quantitative SWOT analysis was developed by Terrence Metz while at the Kellogg School of Management, Northwestern University.
Traditionally, SWOT is a narrative method for describing a current situation. Strategic planning, product development, annual planning of projects, and current situation analysis rely on the concept of SWOT. We have used the following quantitative approach whenever you are faced with prioritizing a complex situation involving hundreds of options.
A Simple Overview
- Strengths (what a group controls and does well),
- Weaknesses (what a group controls but does not do well),
- Opportunities (situations, events, etc., outside control of the group that provide unique opportunities for growth, change, etc.), and
- Threats (changes or competitive forces that may adversely impact the group).
Brainstorm each list separately. Analyze each list (PowerBalls provides an excellent tool for analysis) to prioritize and reduce to about six of the most significant factors each.
Build a matrix (see illustrations below). Opportunities and Threats on top with Strengths and Weaknesses down the side. Explain the scoring method to the group. Each member gets “9” points (it is an arbitrary number and you may change it if you want more or fewer points). They assign their points based on the impact or leverage that each strength or weakness has relative to each opportunity or threat. The higher the impact, the higher the number. Ensure that they don’t just spread them evenly. Scoring should be based on a business understanding. Collect the scoring. Using a spreadsheet (alumni may download), calculate the final scores for each intersection, each column, each row, and each quadrant.
Review the scores with the group and highlight the quadrants, rows, and intersections with the highest scores. Summarize from the list and have the group convert the most impactful concepts into a narrative action plan.
One Person Example of Quantitative SWOT Analysis
A fictitious software company employee looks at its strengths as experience, good people, creative ideas, and product integration. Its weaknesses lean towards newness to market and development time. Opportunities may be realized through integrated products, new market, and extensive market research data that is available. Threats develop from recession, other large competitors (eg, Microsoft), and hardware manufacturers. The one person may score as follows (scored from 1 to 9, with 9 indicating greatest impact):
Quantitative SWOT Analysis Discussion
The scoring indicates the most important strengths are their product ideas and integration. Additionally, development time represents their most significant weakness. Integrated products and growth of computer capture the most favorable opportunities.
Remember that strengths matter if they help take advantage of an opportunity or fend off a threat. Also, weaknesses matter if they prevent a group from taking an opportunity or making them vulnerable to threats. Opportunities require some strength for them to be leveraged and therefore, seized. Therefore, this matrix helps to highlight which strengths, weaknesses, opportunities, and threats require strategies, initiatives, or projects.
Eleven Person Example of Quantitative SWOT Analysis
In the following, you will see a real-life example with eleven participants. Note that the moderate strengths and weaknesses had little or no impact on the plan. Participants largely weighted their most significant strengths and weaknesses to develop strategies. Quantitative SWOT analysis helps focus future efforts – products, projects, strategies, and actions. It takes a few hours to complete, but it is worth the effort when consensus becomes critical.
Again note in the example below that only the most significant strengths and weaknesses have a demonstrable impact on the planning effort. The stuff in the middle, we call lukewarm, has little or no bearing on the planning process. Consistently we have seen that the moderately important strengths and weaknesses have little impact on planning.
 Frequently referred to as SWOT; or situational Strengths, Weaknesses, Opportunities, and Threats
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