How Do I Conduct a SWOT Analysis for a Small Business?

SWOT analysis model, also known as situation analysis method, mainstream business management education such as EMBA and MBA include SWOT analysis method as a commonly used strategic planning tool.

SWOT analysis model

During adaptive analysis, companies

There are three key factors that affect the duration of a company's competitive advantage:

(1) How long will it take to build this advantage?

(2) What are the advantages that can be obtained?

(3) How long does it take for a competitor to respond forcefully?

If the company analyzes these three factors, it will know its position in establishing and maintaining a competitive advantage.

Obviously, a company should not correct all of its disadvantages, nor should it make no use of its advantages. The main question is whether companies should study whether it should be confined to opportunities that already have advantages, or whether to gain and develop some advantages to find better opportunities. sometimes,

get on

There are four different types of SWOT analysis: strength-opportunity (SO) combination, weakness-opportunity (WO) combination, strength-threat (ST) combination, and weakness-threat (WT) combination.

Advantage-Opportunity (SO) strategy is a strategy for developing the internal advantages of an enterprise and utilizing external opportunities. It is an ideal strategic model. This strategy can be adopted when a company has a specific advantage and the external environment provides a favorable opportunity to exploit this advantage. For example, good product market prospects, the expansion of supplier scales and competitors' financial crisis, and other external conditions, coupled with companies

Like many other strategic models, the SWOT model consists of

China Telecom's SWOT analysis case: In the past year, China Telecom's news hotspots and focus have been constantly changing. The adjustment of telecommunication tariffs, the separation of China Telecom from the North and the South, and the challenges of China Telecom's accession to the WTO have attracted attention. In the new year, China Telecom will stage another thrilling drama "Dancing with Wolves". In the face of fierce market competition, a SWOT analysis of China Telecom (SWOT is the first letter of the English word for advantages, disadvantages, opportunities and threats) may allow everyone to have a sober and objective view of the future development of China Telecom understanding.

SWOT analysis model China Telecom advantage

Since the mid-1980s, China Telecom has experienced rapid development for nearly 20 years and has formed economies of scale. Although undergoing a series of reforms such as post and telecommunications division, separation of government and enterprises, mobile paging separation, and reorganization, China Telecom still has strong competitive and development advantages in the Chinese telecommunications industry market. Mainly in terms of customer resources, network infrastructure, talent reserves, service quality, etc .:

1. After the competition mechanism was introduced in the Chinese telecommunications market, China Telecom and other operators such as China Mobile, China Unicom, and China Netcom engaged in fierce competition. After the North-South split of China Telecom, while retaining most of the original fixed telephone network and data communication services, it inherited most of its customer resources and maintained good customer relationships, occupying an absolute advantage in the market. 179 million fixed telephone users and more than 15 million data communication users have laid a good foundation for China Telecom to develop its business and increase its revenue.

2. China Telecom's infrastructure is relatively complete. For more than 20 years of reform and opening up, China Telecom has established a high-speed, large-capacity, high-speed, large-capacity transmission network, access network, switching network, and data that cover the whole country with optical cables as the mainstay and satellite and microwave as the supplement. Communication network and intelligent network. At the same time, DWDM transmission networks, broadband access networks have successively built data communication networks and intelligent networks to expand capacity. China Telecom's network advantage has become the core competence of current enterprise development, and it has the foundation and strength to extend to related professions.

3. During the development process, China Telecom has cultivated and reserved a large number of management and professional talents with high ability to understand the local market, telecommunications management and technology familiar with communication equipment, and reasonable structure. At the same time, China Telecom also has accumulated a wealth of rich experience in operation management, with long-term accumulated network management experience, good operating skills and a relatively complete service system.

4. China Telecom's increasingly perfect service quality. China Telecom has established a Group Customer Service Center to address network access needs for group customers across provinces and cities; China Telecom has also established a service system that accepts and purchases all at one stop to maximize user convenience; Responsibility system solves the problems of companies in the process of providing services to users. In addition, China Telecom has also established a service hotline (1000), complaint hotline (180), etc. Communication services, providing interactive services.

SWOT analysis model China Telecom disadvantages

Although China Telecom has certain development advantages, we should look at these advantages dialectically. Dialectics tells us that advantages and disadvantages are relative, that is, under certain conditions, advantages are likely to turn into disadvantages. Although China Telecom has abundant customer resources, perfect network facilities and a large number of reserve talents, it lacks the strategic concepts, innovative concepts, human resource development management, human environment construction and market system environment necessary for the development of modern enterprises. . People in the industry believe that China Telecom has resource advantages but lacks resource operation advantages. Once inadvertent, the advantages are likely to turn into disadvantages. China Telecom's disadvantages are mainly manifested in the following aspects:

1. The contradiction between corporate strategic management and development. On the one hand, the decision-making layer of the company only pays attention to the current tactics and strategies, neglects the long-term strategy, and loses sight of the day-to-day business affairs, so it can't look at the overall situation. On the other hand, the company lacks the talents to plan the operation strategy of the complex and changing environment. This issue is the core issue for achieving sustainable development and maintaining long-term competitive advantage for enterprises.

2. The contradiction between innovation and development within the enterprise. Functional business processes, management models, and organizational models for the planned economy have shown incompatibility with rapid development, and have gradually become the main factors restricting telecommunications companies from participating in global competition. The reform and innovation of ERP, management, and organizational models, as well as the construction of a humanistic environment with corporate characteristics, are the focal issues that should be considered in implementing corporate development strategies.

3. China Telecom's existing infrastructure cannot provide users with special services. Although China Telecom has a relatively complete network infrastructure, most of them are not built according to the actual needs of the market, but to meet the needs of universal services.

4. The split allowed China Telecom to downgrade from a main telecommunications company to a regional telecommunications company. New China Telecom's main position will be fixed in the southern market, while the northern market will be occupied by New China Netcom. Even with the impact of the split, China Telecom's strength is still the strongest, only suffering from the lack of a national network and the inability to carry out national services.

SWOT Analysis Model China Telecom Opportunity

The rapid development of China's national economy and accession to the WTO will provide unprecedented development opportunities for China's information construction and communications development. It also provides huge opportunities for China Telecom, mainly as follows:

1. The sustained and rapid development of the national economy has created a market demand with huge potential, which provides greater development space for China Telecom. According to relevant research reports, it is estimated that in 2005, after China's WTO commitments have been completed, its GDP and social welfare income will increase by 195.5 billion yuan and 159.5 billion yuan, accounting for 1.5% and 1.2 of the GDP of the year %. The huge benefits of reallocating resources from the comparative advantages of the local economy will further strengthen the local economic strength. And accession to the WTO will promote the introduction of foreign capital and the stimulus of domestic demand. After joining the WTO, the investment environment will be greatly improved in various places. The improvement of legal transparency and the realization of national treatment will attract a large amount of foreign capital, and the strength of local enterprises will be enhanced and strengthened. As a result, corporate telecommunications consumption levels have increased. The adjustment and transfer of the labor market structure will inevitably bring about a large number of social personnel movements, and at the same time will drive huge communication needs, and the traffic market will be further activated.

2. The laws and regulations of the telecommunications industry have been continuously improved, and the telecommunications industry will enter a new stage of management in accordance with the law, creating a fair and orderly competitive environment for the development of China Telecom. With the improvement of the telecommunications industry's legal system, the government's economic functions will undergo a fundamental change. The government will give enterprises investment decision-making rights and production and operation rights to the enterprises, so that they can withstand the test of the market economy. This means that the government will further loosen China Telecom and give it due autonomy, which will help China Telecom operate in accordance with the laws of the market economy.

3. The Chinese government has vigorously promoted the strategic decision of national economic and social informatization, which has created a historic opportunity for the development of China Telecom. The "Three Major Internet Projects" have created an information industry market with a strong consumer capacity in China, while creating a good environment for the information industry market in China, and making China one of the world's largest information industry markets.

4. The gradual opening of the telecommunications market after China's entry into the WTO will speed up the internationalization process of the enterprise, which will be beneficial to the company's operation and management, operating mechanism, and personnel training in line with international standards. At the same time, it can promote China Telecom to learn from the management experience of foreign companies, actively promote thinking, technology and institutional innovation, improve product grades, reduce costs, improve service quality, improve marketing strategies, and enhance core competitiveness.

5. The telecommunications market has huge potential. First of all, China's economic development is uneven, and the differences between regions and consumption levels determine the multi-level and diversification of telecommunications needs. The rapid development of communications technology has promoted the network upgrade and service innovation of telecommunications companies. The potential for developing new services at the convergence point of the telephone network and computer communication has great potential, which has stimulated new consumer demand. Therefore, on the whole, China's telecommunications market has a huge demand potential. Secondly, from the perspective of fixed telephones, the average penetration rate of China Telecom's main line is only 13.8%, which is far below the average level of developed countries. The mainline income, profitability and market size are also far from the average level of developed countries, and the space and potential for development remain huge. Finally, from the perspective of China Telecom's other businesses, the market size and profitability of Internet and fixed-line intelligent network services will continue to expand with the improvement of the external environment level of the enterprise.

6. Issuance of mobile licenses. Minister of Information Industry Wu Jichuan once said in public that China will have four integrated telecommunications operators who can operate fixed, mobile, data and various other basic telecommunications services, which means that two more mobile licenses will be issued . The field of mobile communication is the communication field with the greatest potential and the most fierce competition, and it will become the indispensable place for all telecommunications companies. Once China Telecom has obtained a mobile license, the mobile sector will be another main business of China Telecom.

Threats to SWOT analysis models

The so-called opportunity is with the threat. The impact of any incident is relative. China Telecom will also face huge threats while embracing huge opportunities, as shown in the following aspects:

1. The competition pattern of the telecommunications market has changed from partial to comprehensive, simple and diversified. First, in terms of competition trends, domestic market competition will transition from price competition to core competence innovation competition. During the transition period, market share grabbing will become the focus of development for market followers. Secondly, the pressure of international capital competition will gradually increase after joining the WTO. Foreign telecom operators will continue to accelerate the speed of global service through mergers, mergers and acquisitions. The value-added services such as ICP, EMAIL, database, fax, and video conferencing in the Chinese telecommunications market are the first to be hit hard, which will affect the stable growth of telecommunications companies.

2. China Telecom's brain drain is serious. Many companies at home and abroad have adopted policies such as high salaries and high benefits to attract China Telecom talents, resulting in a serious loss of China Telecom talents. This phenomenon has not yet been resolved. The flow of talents is an inevitable result of competition and a key issue related to the survival and development of China Telecom. Therefore, how to reflect the value of talents and develop their potential is a problem that China Telecom must face up to.

3. Impact of asymmetric regulation on China Telecom. China Telecom is subject to relatively strict industry regulations in terms of operating licenses, interconnection, telecommunications tariffs, and universal telecommunications services. In the Chinese telecommunications market, the inequality of regulation has restricted the development of China Telecom. Under the increasingly fierce competition in the telecommunications market, reforms will not be implemented as soon as possible, and China Telecom will only die. In the near future, New China Telecom will change its mechanism through listing to realize the same mechanism platform as China Unicom and China Mobile, so as to carry out effective fair competition.

SWOT analysis model of a refinery case

An oil refinery is one of the largest oil refineries in China and has a history of more than 50 years. Has become a comprehensive oil refinery with a capacity of 7.3 million tons / year of crude oil processing capacity, capable of producing more than 120 petrochemical products, fuel-lubricating oil-chemical raw materials. The factory has 6 products won the National Gold Award, 6 products won the National Silver Award, 48 products won 114 Quality Product Certificates, won the National Quality Management Award in 1989, and passed the international GB / T19002-ISO9002 in August 1995. The quality system certification has become the first company in China to receive this award.

The plant has strong research and development capabilities, and can develop and produce various types of lubricants with its own base oil. When Volkswagen Santana settled in Shanghai, its engine oil needed to be imported with expensive foreign exchange. After receiving the task in 1985, the factory research institute immediately conducted investigations and established laboratories. In a short period of one year, the company successfully developed oil products that met the German Volkswagen's company standards, obtained the approval certificate of Santana's matching oil, and began to put on the market in 1988. Later, with the improvement of Volkswagen's product standards, the institute's research institute has developed new products that meet the standards in a timely manner, which meets the production of Santana and Audi, and special oil repair points and markets in the country.

However, the refinery is a production-oriented state-owned factory. Under the traditional system, the production and sales of products are uniformly allocated by the state. The personnel responsible for sales are only doing some accounting and unified accounting tasks. Be truly market-oriented. In the process of transitioning to a market economy, large and medium-sized enterprises, as pillar industries, are still subject to the state's macro-control to a certain extent, and it is difficult to adapt to the highly competitive market in terms of product marketing. There are only more than 30 people in charge of marketing and sales at this plant, and even fewer are specialized in lubricant sales.

Shanghai's small-package lubricant market is about 25,000 tons per year, of which imported oil accounts for more than 65%, and domestic oil is at a disadvantage. There are many reasons for this situation. On the one hand, in terms of product promotion, the all-round large-scale advertising offensive of imported oil is nuanced. Light boxes, billboards, taxi window glass, consignment counters and gas stations on the walls of imported oil can be seen everywhere, as well as radio, TV and newspaper advertisements and press conferences, prize promotions, gifts, etc. form. The performance of domestic oil in this regard is pale and incompetent. In addition, the factory's oil products were mostly in bulk in the past, sold in large quantities directly from the factory, supplied to large enterprises and institutions, and rarely listed in small packages, coupled with few points of sale, it was difficult for ordinary users to buy economical Domestic oil, and had no choice but to import expensive oil.

According to the above situation of the refinery, we can use SWOT method for analysis. According to the analysis results, in order to reverse the passive situation of the refinery in marketing, the following measures should be considered: formulate marketing strategies; increase marketers and points of sale; increase product small packaging; implement brand strategies; carry out door-to-door and after-sales service Develop new products; continue to improve product quality and reduce product costs; give full play to product quality and price advantages; publicize the effect of ISO9002 certification; improve research and development through competition

SWOT analysis model Wal-Mart case

Advantage (S)

Wal-Mart is a well-known retail brand. It is well-known for its high quality and low prices, a wide range of goods and one-stop shopping.

Wal-Mart's sales have grown significantly and are expanding globally (e.g., it acquired UK retailer ASDA)

One of Wal-Mart's core competitiveness is an international logistics system supported by advanced information technology. For example, with the support of this system, the logistics information such as transportation, sales, and storage of each product in each store nationwide Can be clearly seen. Information technology has also strengthened Wal-Mart's efficient procurement process.

A focus strategy of Wal-Mart is the development and management of human resources. Good people are a key factor in Wal-Mart's business success. To this end, Wal-Mart invests time and money to train and build loyalty for outstanding employees.

Disadvantage (W)

Wal-Mart has built the world's largest food retail empire. Despite its advantages in information technology, due to its huge business expansion, this may lead to insufficient control over certain areas.

Because Wal-Mart's products cover multiple sectors such as clothing and food, it may have a disadvantage in adapting to competitors who are more focused on a certain field.

The company is global, but has opened up markets in only a few countries.

Chance (O)

Cooperate with other international retailers through acquisitions, mergers or strategic alliances, focusing on specific markets such as Europe or Greater China.

Wal-Mart stores are currently only open in a few countries. Therefore, expanding markets (such as China, India) can bring a lot of opportunities.

Wal-Mart can gain market development opportunities through new mall locations and mall formats. Malls closer to consumers and stores built inside malls can diversify the way of doing business that was once just a hypermarket.

Wal-Mart's opportunity lies in sticking to its existing hypermarket strategy.

Threat (T)

Wal-Mart's leading position in the retail industry makes it a catch-up target for all competitors.

Wal-Mart's global strategy makes it possible to encounter political problems in the countries where it operates.

The cost of many consumer goods is trending down due to lower manufacturing costs. The main reason for the decrease in manufacturing costs is the outsourcing of production to low-cost regions in the world. This has led to price competition and deflation in some areas. Vicious price competition is a threat.

Wal-Mart SWOT analysis

Strengths.

Wal-Mart is a powerful retail brand. It has a reputation for value for money, convenience and a wide range of products all in one store. Wal-Mart has grown substantially over recent years, and has experienced global expansion (for example its purchase of the United Kingdom based retailer ASDA). The company has a core competence involving its use of information technology to support its international logistics system. For example, it can see how indlidual products are performing country-wide, store-by-store at a glance. IT also supports Wal-Mart's efficient procurement. A focused strategy is in place for human resourcemanagement and development. People are key to Wal-Mart's business and it invests time and money in training people, and retaining a developing them.

Weaknesses.

Wal-Mart is the World's largest grocery retailer and control of its empire, despite its IT advantages, could leave it weak in some areas due to the huge span of control. Since Wal-Mart sell products across many sectors (such as clothing, food , or stationary), it may not have the flexibility of some of its more focused competitors. The company is global, but has has a presence in relatively few countries Worldwide.

Opportunities.

To take over, merge with, or form strategic alliances with other global retailers, focusing on specific markets such as Europe or the Greater China Region. The stores are currently only trade in a relatively small number of countries. Therefore there are tremendous opportunities for future business in expanding consumer markets, such as China and India. New locations and store types offer Wal-Mart opportunities to exploit market development. They dlersified from large super centres, to local and mall-based sites. Opportunities exist for Wal-Mart to continue with its current strategy of large, super centres.

Threats.

Being number one means that you are the target of competition, locally and globally. Being a global retailer means that you are exposed to political problems in the countries that you operate in. The cost of producing many consumer products tends to have fallen because of lower manufacturing costs. Manufacturing cost have fallen due to outsourcing to low-cost regions of the World. This has lead to price competition, resulting in price deflation in some ranges. Intense price competition is a threat. Wal-Mart Stores, Inc. is the world's largest retailer, with $ 256.3 billion in sales in the fiscal year ending Jan. 31, 2004. The company employs 1.6 million associates worldwide through more than 3,600 facilities in the United States and more than 1,570 units... more? Go to Wal- Mart Facts

Disclaimer: This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.