SWOT (Strengths, Weaknesses, Opportunities and Threats) Analysis is sort of all the rage in strategic planning these days, and is typically applied in a business setting to strategize about a certain objective. It is also this week’s new decision making technique, though it isn’t explicitly used in decision making as much as strategy. In this case I’m going to apply it on a personal level to analyze my own strengths, weakness, opportunities and threats.
Part of the popularity of the SWOT analysis may come from it’s simplicity. Once an objective is defined, a list of each aspect is created. This list is used to create a strategy for achieving the objective.
Yet that simplicity is also the source of it’s criticism. SWOT analysis has been criticized because it leads people to think they have done an adequate job of planning when all they’ve done is list four categories of aspects. SWOT analysis allows you to consider the factors that are affecting a situation or objective, but doesn’t provide the strategy itself.
One key for a useful SWOT analysis is to make sure you have an explicitly defined objective. SWOT analysis in the abstract tends to contribute to the error of thinking SWOT is adequate and the analysis ultimately has little relevance. Since I’m doing this exercise on a personal basis, here’s my objective:
To move into more creative work based on idea generation and execution in programming and design.
Corollary: Given the tendency for businesses to reward status quo success over creative innovation, it is likely, though not necessary, that this means a startup or freelance work.
With this objective in mind, the first step of a SWOT analysis is to consider the internal factors: strengths and weaknesses. These should be things that are inherent to the person (or company usually) and not things that involve external factors.
Strengths and Weaknesses
|I love idea-based creative work||Hubris (or at least overconfidence)|
|Enjoy learning so much I get bored if I'm not||Not a hacker|
|Highly motivated on interesting work||Lack of design experience|
|Strong mathematics and statistics||I'm older than just out of college stars|
|Analysis and problem-solving experience||Reputation and contacts are in economic analysis|
|Some programming experience||Financial limitations mean I can't focus 100% on new direction|
|A good sense of design (in my own opinion)||I go through and emotional cycle of excitment and despression regarding a project|
|Knowledge of decision-making biases and techniques||No computer science or design accreditation|
|Willing to take criticism||No perspective on world cultures (see Threats)|
|Friendly and (more importantly) honest and direct||Lack of confidence in ability to program|
|Experience with economics allows for consideration of macroeconomic and political trends|
|No dependents allows for risk-taking|
The next step is to consider the external factors: opportunities and threats. These are things like political and economic factors, market trends, situational and environmental changes, etc…
Opportunities and Threats
|Creative idea-based work is and will remain in demand while repetitive work is being outsourced||US is not likely to remain the leading economic power|
|Internet startup costs are almost negligible (at least at the beginning)||US is moving toward a anti-privacy fascist policies|
|US has a lot of educational and other opportunities||Albuquerque is not a center for creative and intelligent work|
|Frameworks such as Ruby on Rails and Django make web site development fast||Global economy is facing significant possibility of recession|
|No demands on my time other than my job||US patent system stifles innovation and increases litigation costs|
|Many other people are better connected and have better skills|
|Is there a web 2.0 bubble?|
|For now, others can implement ideas much faster than I can|
That’s the complete SWOT analysis process, but I hardly have a strategy at this point. I’ll have to work on developing one and post it later. There are some key things to point out here though.
First is that I listed more positive than negative factors when talking about myself and less positive factors when thinking about the external situation. Is this a result of selective consideration of evidence as a confirmation bias, or is it just the truth of the situation? Something tells me that if I was someone else doing this analysis on me I’d find more negative personal aspects.
Second, there are some things I listed that need qualification or explanation. I should start by saying that I need to go back and revise my objective to explicitly say creative problem solving instead of just creative work. When I think of creative work I’m generally thinking of new approaches to problems, not things like art or poetry (not to dis on all you cool artists out there).
Another thing that strikes me is looking at the lists of strengths and weaknesses, I am much more capable of succeeding that I usually think. One of my perennial weaknesses is that I underestimate my ability to program, but as I work with code more and more, I am finding myself naturally learning and able to do stuff I would have recently balked at.
None of my weaknesses seem particularly strong or debilitating. Further, taking advice that I heard from somewhere (maybe The 4-Hour work Week), I’m going to focus on increasing my strengths rather than eliminating my weaknesses. Why? Because the return on investment for increasing my strengths is exponential, while the return to eliminating my weaknesses is (at least in the beginning) linear at best, not to mention demoralizing.
One the other hand, my biggest concern for any advertising-based revenue source (such as this blog) is that a consumer spending led recession, especially with the astronomically high levels of debt, will result in a significant decline in sales of all kind, including ad-based internet sales.
So that’s a SWOT analysis, and it gives me a basis for examining the variety of factors that will affect my failure or success in obtaining my goal. If you’re like me, you’re thinking that it’s rather similar to other decision making techniques like the Pros-Cons-Fixes method used in What am I doing with my life? and Plus-Minus-Interesting used in Buy vesus Rent Part II.
The only real difference is that instead of considering the pros and cons of each option in a decision, we’re considering the pros and cons of ourself or our organization with respect to an objective, and we’re explicitly separating internal and external factors.
On an entirely different note, why do so many decision making and strategic planning web sites seem like the digital version of a car salesman? There are only two real possibilities here. Either all these decision making techniques are snake oil, or the techniques are ok but the consultant is about as valuable as a car salesman.
Decision making techniques in general seem useful, but don’t do much to account for decision making errors. In a way they are merely the formalization of methods we do implicitly. Though I think there are real benefits to plotting things out explicitly, I’m not convinced of the usefulness of hiring consultants to do so. My suspicion is that there are a few really good ones and a whole lot of ineffectual ones, just like most other fields. More on this later.