I really like SWOT for strategy. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. It’s about brainstorming and making lists of bullet points. Take a piece of paper or a white board for a group, and build the four lists.
SWOT is a good idea even as quiet thought for an individual, but it’s much better if you can do it in a group setting. The group improves the brainstorming value. Even if yours is just a one-person business, invite your spouse or significant other, or a few trusted friends who know your business (maybe you buy the lunch), and–if you can afford the hourly fees–your accountant or attorney. If you’re in a small business with a team, invite the team.
SWOT is about brainstorming, which is generating a lot of ideas, not just a few good ones, and then boiling them down to a strategic list. With bullet points, more is better. Make sure that during the brainstorming period you aren’t negative or critical of any ideas.
The SWOT divides in the middle between the top two lists, strengths and weaknesses, which are about your business; and the bottom two, opportunities and threats, which are about the world outside.
Strengths and weaknesses are traits of your business. You can change them over a long term, but not easily. You can improve strengths and correct weaknesses, and planning helps; but it takes hiring new people, finding new resources, training, and making an effort.
Opportunities and threats are things external to your business, out in the world at large, which you can foresee. Strategy is clearly about taking advantage of opportunities and avoiding threats.
One of the great advantages of SWOT is how easily it brings people into the process. Companies differ, but in general, your planning will work better if the people who are supposed to implement the plan are involved in its development. SWOT involves people in the plan, helping them see the strategy and making them feel like part of it.
SWOT in a small business also offers a safe forum for generating new ideas and breaking through standing assumptions.