Benefits of SWOT Analysis as a management reporting tool

As we stated in our article on management reporting methods – ensuring information is promulgated throughout the organization in a clear and concise fashion is extremely important – the use of best practice templates and methods can help facilitate this.

Of all the various models SWOT Analysis, while better known as a strategic tool, is a popular method associated with management reporting, encouraging review of internal and external influences and can be used to evaluate a variety of business activity from projects through to departmental performance.

SWOT is a four box communication method used to evaluate 4 key factors

Strengths

Internal Activity or attributes that are helpful to achieve objectives

Weaknesses

Internal Activity or deliverables that can have a detrimental impact on the objective.

Opportunities

External Activity that could be helpful in meeting targets

Threats

External Influences or activity that could have a detrimental impact on the objective

SWOTS are especially useful as a reporting tool because it helps identify actions that can be taken to achieve a desired state and as such are often used in strategic planning sessions

Weaknesses of SWOT analysis

While SWOTS can be very useful (especially in strategic analysis) they can have their downsides.

SWOTS can be subjective and overly critical (people typically find it easier to come up with weaknesses and threats than strengths and opportunities). And perhaps key – SWOTS do not automatically drive activity and without proper care and attention can be seen as a list building activity. As such SWOT’s should not be used in isolation.

In summary the use of SWOT analysis is widespread it is a common tool that can help in communicating information within an organization – its simple to construct and to understand used in isolation it can be used to share information – combined with an action plan it can be used as a strategic management tool

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