Transcript of: SWOT Analysis– Business and Personal Success Tool
Presented by Dr. Bilello on 30 June 2020 Watch the Webinar
Dr. Bilello has a PhD in molecular biology and was the former Director of Technology Development at GlaxoSmithKline. In addition to an established track record of innovative, basic, and clinical research, Dr. Bilello has experience in both project and organizational management. As an entrepreneur, Dr. Bilello was a founder of Ridge Diagnostics, and a co-founder and managing partner of Innovalyst. At Innovalyst, he worked with companies from small businesses to Fortune 500 companies, as well as Invest NI, Northern Ireland’s regional economic development agency. Thank you so much for being here Dr. Bilello and I’ll turn the presentation over to you now.
Thank you. Before I begin I’d like to you a couple of questions, how stable is your work environment or your business in the era of COVID-19? How easy will it be for you to obtain capital to develop your idea into a business in the next six months? If you currently have a business, how much ground have you lost in the past four months? Or more importantly, what opportunities have you missed during that time? What I hope to offer you is a tool that will change the way that you approach the development of your business strategy today, tomorrow, next year and beyond, but it will cost you the next 45 minutes or so of your time.
As shown in this slide, the success of any business is determined by a multitude of factors. Success depends upon the interaction of internal factors such as, the science behind your idea, the talent, the organization, the intellectual property, and other things that are internal for your company. But internal factors really are only part of the equation, external factors such as, regulatory policies, the availability of capital, consumer demand, and advances in technologies, and even a coronavirus outbreak can also impact your path to success. Bear in mind that every company is confronted with multiple internal and external forces on which either they act as potential stimulants, or on the other hand, factors can severely limit the achievement of a company’s both short and long term objectives.
So what is a SWOT analysis? SWOT really is just one tool in integrating internal and external factors into the strategic planning process. I am sure that many of you have heard about SWOTs, you may have done a SWOT when you put your business plan together. Maybe you’ve done a deeper SWOT analysis when you were writing a commercialization plan for a grant. Doing a SWOT it’s a way to take a long hard look at what are the keys to turn your idea into a company. However, a SWOT analysis of valuates a company’s strengths and weaknesses at any point during its maturation, so that an organization can take on opportunities and avoid threats. And for those reasons, SWOT should be part of the strategic planning process in almost any business. But do you use a SWOT in your business? Do you use it in your personal life?
I don’t know why, look how colorful it is. You can see from this SWOT matrix, that it’s a simple visual way to get insight into the contribution of internal and external factors that impact an organization’s success basically. Factors that are internal and helpful are strengths. Factors that are internal and harmful are weaknesses, and weaknesses are the W obviously in SWOT, right? And then we get to the external factors. Opportunities are the O in SWOT and they are generally found to be helpful. And threats lastly, are external and usually harmful. These four categories serve as the general areas for developing questions to ask prior to doing this SWOT. During the course of a SWOT, questions that were formulated our posed to do a group and then the group will provide answers to the questions. Hopefully, and I say hopefully, after the SWOT, the results will be recorded, immortalized essentially, and actions then will be formulated and prioritized out of this SWOT.
Bear in mind, that putting together a SWOT matrix is really a group effort. Consider it sort of as a brainstorming session and it really works best if you bring a heterogeneous and multidisciplinary group of shareholders, stakeholders actually, together and you do it in a format that allows challenge the critical examination of facts because you want to really deal with facts. You want to take into account people’s opinion and have an openness for new lines of thoughts. Doing a SWOT with such a team tends to eliminate bias, it also provides different points of view.
At this point I’d really like to point out that this should not be a spur-of-the-moment type of event, people really need to prepare and do research for a SWOT. A group of people need to put the questions together to form up the objectives, but the group also needs to set aside a reasonable amount of time. In my earlier company, Ridge, we would clear the morning and have a lunch together afterwards. We had tried afternoons and cocktails and dinner but that didn’t work out as well and most people forgot what we were there for anyway. But the important thing is that you really need to block out time to get at key issues.
So now that we have the SWAT matrix we can begin to do the work. This slide just reminds us that strengths of a company are both internal and positive. They’re internal because they’re the core competencies and they’re positive because they de-risk investment in the company. The general areas of strengths include qualities that distinguish the organization from competitors. Questions that we usually ask during that area is what do we do exceptionally well as a company and what do we have that our competitors do not? For example, you may have leadership which is world class and that may really tip the balance. What are your valuable tangible assets? And these really include things such as, a strong IP portfolio and whether you have substantial capital equipment. And then obviously we get to the point that a major resource is really capital itself, funding from grants and investors can be a significant resource and advantage to any organization.
But also what you have to consider is something that’s often overlooked, like what are your potential partners and what are potential exits for the company> Not every company becomes a multinational, so you have to look at and plan for what are potential exits for your company. As I indicated, the strengths of the company are internal and positive, and investments in biotech are essentially risky. And strengths de-risk investments and remember, investments by themselves are a positive in taking your company forward.
The dreaded weakness slide, I know it. This is this brings up questions like, what could we do better? Where are we vulnerable? And weaknesses, like strengths, are internal but they’re negative because they add risk to the company’s success and tend to limit investments into the company. The general areas of weakness are shown appropriately in black, and they include things like resource limitations. Perhaps there’s no laboratory space that was identified or there are limitations such that you can’t work with lab animals in your current facility. Perhaps the weakness lies in the product. Is it clear who the customer is, or if you have the right target customer, is it clear that they will actually buy your goods or services? Is the market overcrowded? This weakness is sort of self-explanatory, if there are a large number of players in the market, how are you going to get your foot in the door? How are you going to get an advantage? And lastly, weaknesses are things that your company such as, staffing or business acumen. I’d like to emphasize that it’s really critical to identify weaknesses early so that you can force correct.
We come to opportunities. Opportunities are external and usually positive, companies can usually take advantage of opportunities even though they can’t control their timing or their occurrence. Sometimes just being there at the right time is enough. But really successful organizations actively look for opportunities. And opportunities can fall into again, some general categories such as, unforeseen or emerging need for your product or service. There may be a few competitors in the field that you’re entering. Innovation or a new technology emerges that you can use to your advantage. One of the really cool things is when your competitor actually flops, that’s a real opportunity. Or you can look to the relationships that you make. You can actually leverage relationships. For instance, if Governor Newsom is your brother-in-law, that may mean you can get some access to some state contracts. Sorry about that Californians. Anyway you really need to ask what opportunities do we know about but have not moved on and are there emerging trends that we can capitalize? Remember, taking advantage of opportunities can reduce risk and can enhance the chance for success.
No one likes threats really, they’re external factors that are generally negative. They always increased the risk of your venture being unsuccessful. Threats include, your competitor copies your product, you lose talent, new requirements for approvals or registrations pop up or your application for an approval was rejected. Perhaps there is a possibility that your trade secrets are leaked by your competition, that’s why you should always make sure that you treat your employees well. Some of the questions that you need to ask is, are their weaknesses that make us critically vulnerable? Emphasis on the critically vulnerable. Are economic changes, particularly ones that are going on now, affecting your company’s financial viability? Remember, a small unanticipated change can be devastating. Just think about how many businesses are going down right now due to the COVID-19 outbreak.
So what are the advantages of doing a SWOT analysis? And briefly we’re just going to go through this. I think one of the advantages that it’s data-driven and scientists and engineers, that’s usually your sweet spot. Secondly, a SWOT can stimulate critical thinking which can often be a hurdle if you think like an academic when you need to be thinking like an entrepreneur. A SWOT really costs nothing but time you don’t need to build algorithms or special rooms to hold them in or hire lots of experts. Lastly and most importantly, it’s an iterative process. It means that it can be used many times during the company’s lifetime and for a number of different problems that arise. Oops, I just, here we go. Sometimes I just lose control.
But anyway, how do you do a SWOT for a new business? Well the first thing you do is you decide on what the objective is, is it go or no-go which is extreme or is it whether to maintain the ties with the university until you’re really ready to spin out? Thirdly, as I pointed out before, the best way to conduct a SWOT analysis is with a group brainstorming essentially. Lastly, you have to begin with the identification and evaluation of strategic factors which either assist or hinder the company in reaching its full potential. You have to focus on the internal factors because those are the ones where you have control. What I’d like you to take away is that the only thing that’s really a given is that things will change and the relative importance of any factor will either increase and/or decrease, and what was once a weakness can become a threat or an opportunity or even a strength, so for that reason alone, you should do SWOTs at multiple time points in your development.
So I want to give you an example, this is, we looked at how to use this process in developing a business and that’s often what people look at. But this slide shows an example of a SWOT analysis was performed in order for a company to make a decision about whether it’s going to make a peptide viral vaccine for the coronavirus. We’re going to step through the company’s SWOT step by step, but we’re not going to do it on this slide. We’re gonna break it down on individual slides.
First thing that we have to deal with is our first thing that the group did, was to assess the strength of making peptide vaccine. And they listed the positive aspects for that particular type of vaccine. Obviously one of the most important thing when you have a highly infectious virus is safety, and you have peptide vaccine the total absence of infectious virus. There’s also an issue around being able to easily differentiate between infected and vaccinated animals early on in trials. And manufacturing could actually be done quickly because the synthetic methods which are available, which are both robust and scalable. They also listed the fact that lyophilization of a peptide could lead to enhanced stability upon storage and that would remove the requirement for a cold chain. And lastly, while the registration of a peptide vaccine as a pharmaceutical is a difficult process, costly as well, it does appear to be relatively easy as opposed to registering a biologic.
So they then listed the weaknesses for developing a peptide vaccine. B cell epitopes and not always simple linear peptides. T cell epitopes are not often well characterized and a potential killer is that peptide vaccines are often weakly immunogenic and may require adjuvants or multimerization. For this particular group, manufacturing would be a serious challenge, since they would have to produce an incredible number of doses. They then realized that they would need to have to engage a large industrial partner.
So what are the opportunities here? Well they generally are opportunities related to the properties of peptide vaccine, and we can go through them, but I think the most important opportunity is in the case of a coronavirus vaccine we need itself may be the dominant factor in driving a investment into the company. As you may remember, registering as a pharmaceutical was one of the strengths as well and what we’ll see later is that linking strengths with opportunity is a key strategy for any company.
I want to… I always… oh, did I leave out threats? Yes. Threats okay. I don’t like threats but if you think about possible threats to a peptide vaccine project, the first basically is the politics and policies related to clinical trials, they’ve been changing and becoming more restrictive, particularly in some parts of the world where it was fairly easy to do a vaccine trial. The second threat is the slow speed of clinical vaccine trials. It really does take time to assess the safety and efficacy of vaccines. And really, competitors that can get to the market quicker if they have something like a live attenuated or an inactivated vaccine. Sometimes competitors may own the rights to the best adjuvant for your particular peptide. Lastly, there are threats which are totally unpredictable such as, the emergence of a highly effective therapeutic that reduces the need for a vaccine. It is actually the magnitude of potential threats along with the length of time that it takes to test the vaccine that increases the risks of investment in this area, and that becomes a major issue for smaller companies that don’t have a lot of cash on hand.
The next area I want to talk about, I call it swatting and plotting. And the simple truth is that a SWOT analysis, which is conducted just to produced a simple list as the output, is frankly inexcusably inadequate. The plotting part of it comes from the using a SWOT analysis for developing business strategy, essentially plotting the course of action for the company. And basically to be useful, a SWOT has to lead to a plan of action.
So how do you use the outcome of a SWOT? Well, a SWOT is useful in developing business strategy by use of two simple methods. The first of which is matching. In matching, you connect two categories together and use that to determine a course of action. Matching strengths to opportunities shows where you can be, in areas where you can be aggressive and take action. Matching weaknesses to threat exposes areas you should work on or situations to avoid or where you really need to take a more defensive position.
This is one of those matching matrixs and it shows how four distinct strategies can be developed in these four areas. Strength-opportunity strategies use your internal strengths to take advantage of opportunities. Weakness-opportunity strategies improve your weaknesses by taking advantage of opportunities that are available to address those weaknesses. And you can see that strength-threats strategies can actually use your strength to minimize threats that pop up. And lastly weakness-threats strategies work to eliminate weaknesses to avoid threats. And you can see that the matching process is really not that complex and strategies really can be developed to take advantage of opportunities or to minimize threats. However, if you have a long list of strengths or weaknesses and opportunities, you need to have a way to prioritize how important the individual strengths and weaknesses are to moving the company forward.
And this next slide shows the confrontation matrix which utilizes and prioritize factors based upon strengths. Actually a confrontation matrix allows you to both analyze and weight the importance of each different combination, you can see on this thing you have a whole list of weaknesses that have been prioritized, strengths that have been prioritized, opportunities and potential threats, and the first aim is really to identify the most important strategic issues that the organization is facing in each of your four quadrants. You can see that a WO strategy searches for opportunities that can overcome key weaknesses, and a SO strategy takes advantage of the strengths to embrace an opportunity and so on and so on. A key factor in the confrontation matrixs importance, strengths and weaknesses have to be prioritized by their importance to the fate of the company. Opportunities are different, they’re prioritized by their importance and their probability of occurrence this process of prioritization leads to each strengths and weakness having a value in each opportunity or threat having a value and then the object of the matrix is to look for matching and mismatching between potential opportunities and threats. I really don’t have time to go into the details of using confrontation matrix and to show you exactly how you can do this by an example, but there are Excel spreadsheets that are available YouTube videos and articles online to take you through the process that can be used to actually prioritize actions.
So these were more or less matching, but the second option or strategy after doing a SWOT is to begin to convert. Now that you have data on the negatives, the very next step that you need to do is to turn or convert the negatives into positives, your weaknesses into strengths, or threats into opportunities. You can take the example of where your staffing is limited and you find a way to add additional personnel like interns or volunteers as an alternative to struggling by yourself. You can seek partnerships or join an accelerator like ULP, or you can contact ScienceDocs for help in acquiring grant funding. And all three of those actions are successful, or potentially successful, conversion strategies. And I think you get an idea of how we can effectively use SWOT analysis to actually push and develop individual company strategies.
In the remaining time, I’d like to talk about doing a personal SWOT. It’s like a business SWOT but it really focuses on you and your goals. The key difference is that you really focus on a specific goal or project. One of those personal goals may be to get a new job. In the opportunities arena, you might want to do a search to match your strengths to the available opportunities. You might want to do things like role play to shore up your weakness in doing interviews, and you have to remember that a potential threat is the downturn in the economy, so no matter what the issue you can do a specific SWOT analysis to define specific courses of action. But whatever the objective is, you must focus on actions that lead to the outcome that you want.
This next slide shows a personal SWOT matrix, which is similar to the one that we use for business strategy. However, it’s filled in with questions to ask when you’re doing your personal SWOT. As Karen said earlier, you’re going to get a copy of this presentation so I’m really not going to go through each of these individual questions, but I would like to have you notice that these areas are generally internal. The important areas are actually internal, that is they relate to you personally in the resources and skills that are available to you. When you look at this thing, you realize that those internal factors are generally the ones that are under your control. Once you’ve investigated that, then you identify any opportunities that would enable your quest for a new job or whatever. And then at the very end, you can identify any real possible threats that might emerge.
Again I’m I’m gonna look towards using the outcome of a personal SWOT and in terms of the best strategic option for a personal SWOT really is just to convert negatives into positives. Converting weaknesses into strengths may include building on your skill set maybe getting guidance from somebody you trust or sometimes actually the best defense against the weakness is to overcompensate with excellent preparation. I wish I would have done that for this particular webinar but time was not there. Anyway, think about if you’re someone that has a terrible sense of direction and you have to get to a meeting in downtown Boston, perhaps you would want to get a GPS installed in your vehicle so that you can turn that weakness really into an opportunity.
One other way to look at this is that you can look for ways to serve others that have the same problem that you have. Consider the fact… well let’s get back to the vaccine and this is a live vaccine and you found a weakness in the equipment that was used in a cold chain for transporting that vaccine. So you worked out, and with another company, developed a refrigerated container which sent out real-time temperature measurements and that could set off an alarm when the temperature dropped two degrees. Chances are there’s another company out there that might want to purchase that similar kind of solution. Obviously there are advantages of conducting a personal SWAT and converting weaknesses to strength really may include building upon your skillset. But since SWAT is a focused activity, you can really use it to develop specific strategies for key life events.
And what makes a personal SWAT particularly powerful is that it can help you uncover opportunities that you would not have otherwise spotted. And I would like to end with the idea that SWAT is really just one tool. SWOT is simple but useful, but it also, like any tool really requires some degree of familiarity and skill and probably the most important aspect of obtaining a maximum benefit from a SWAT, is to figure out what questions you really need to ask and then doing the research to support the answers to those questions. I’d like to thank the ULP team, and all three of you that are listening to this presentation and I hope to take a few questions.
Thank you John, we do have some questions. First and foremost, now what is your recommendation in regards to how often a business should do a SWOT analysis?
I like to use the doctor analogy. If you obviously need to go to a doctor when you break your leg, it’s sort of whenever something really serious emerges when there’s a real serious problem that you want to address you then want to take on and do a SWOT. But however, when you have trouble sleeping or you’re not eating or whatever and something seems wrong or a little off it, then you also go to a doctor, so it’s not always the most serious things that you have to worry about, it’s relieving anxiety. Obviously, you have a coronavirus outbreak, a lot of people are particularly anxious about what the company is going to do in terms of new procedures and things like that, when will it be coming back that. It might be a good time for the people that are involved in the company actually put together a SWOT to answer the questions about how they going to deal with reopening, for instance.
And lastly, you got to think about the fact that your overall health, you might like to take advantage of the fact that you have an annual physical and if you’re old and feeble like I am, well just the old, what you might want to do is have it more frequently and if you have a particular issue, you might even want to engage a specialist and then that’s another thing about doing SWOT analysis occasionally you might not just want to use the people that you have around you but you might also want to engage someone who has some expertise and familiarity with doing SWOTS. And then there’s, sorry if I’m taking time with this but I think it’s really important, because most the only time people do a SWOT is when they do their first business plan and maybe they’re their commercialization plan for phase two SBIR. These things are really things that can really guide you directly into actions that move your company forward.
Now, if you’re a smaller company you might do this for your individual company, but if you’re a larger company where you have divisions for instance, you have several different departments in each department may do their own SWOT. And sales may want to do one when embarking on a new campaign. So there are places to do a SWAT that occur in small, medium, large, and gigantic corporations. I worked for GlaxoSmithKline and each individual organization occasionally had a ballroom size meeting where they then went through what generally was disguised, but underneath it all, was really a SWOT. I hope that answers people’s questions.
Yeah, great insight. Now what, as you’re preparing for the SWOT, can you give us some tips and pointers on how to get the participants to actually prepare to actually perform a SWOT?
I think the biggest thing is obviously, if the problem is big, that tends to drive people to want to address it. You also need to have, take into account, that particularly if you’re a new company, one thing that’s often really overlooked is really a deep dive into what your competition looks like, what your market looks like. And there are ways and there are people within an organization that that take on those kinds of assignments. For instance, you may have a researcher that’s really good at grant writing, I don’t know we would find one, but I guess it might even be a ScienceDocs guy. But you could you can see where you could go to this guy and say, “Okay we’ll take advantage of your expertise and you develop a series of opportunities for the opportunities region.” Someone who has a larger overview of the organization, like a COO or somebody like that, they may want to take over doing the preparation for the strengths or the weaknesses. And threats could be the threats that are out there that are bothering people in the organization, you can gather those. Sometimes I think that’s that’s the one that really needs the least preparation because the possibility of dealing with them is probably less, not less in terms of the magnitude, but less in terms of their particular appearance on the scene. You can’t predict threats as well as you can predict opportunities.
Now I know you great gave us some really great questions on some of your slides so we’re definitely going to share with the audience. Do you have any other tools that go hand and hand with doing these SWOT business analysis?
There are so many tools out there and they all have acronyms like PESTLE and we actually at Innovalyst, basically develop a tool for new businesses and we had one where we weighted each individual area, for instance, what was the strength of the company in terms of their business acumen. What was the strength of the team for the beginning portion, for instance, in a scientific area you might to really want to have a lot of scientists running the company, you really don’t really need a professional CEO. Once you get past that initial burst, then you might need somebody that’s more advanced and there are there ways to get at taking advantage of some of the newer tools and seeing when it might be important to make that switch. I’m sure there are all kinds of AI things available nowadays to take advantage of looking at your whole company and seeing when you might want to make changes, so there are other TOWS analysis, there’s lots of different things that I think all you have to do is type in, “I’d like information on business strategy,” and you’ll find all of these kinds of methods and technologies.
I like SWOT because it’s easy and if you don’t just leave it as a list if you really take it as something that’s really a source for developing strategy, and you do it frequently, and you also maintain those SWOTs to look at where you were at different points in the development of your company, sometimes being able to go back and look how look at how you handled a specific weakness five years ago, might be useful to you today. So that’s why I like a SWOT and taking advantage of the fact that you can use these SWOTs to, not just now, but during the whole lifetime of the company.
Great. Now one question, I got a throw it out, are there are any disadvantages with a SWOT analysis, we talk about all the great advantages now.
Yeah I actually have a slide that I hid where I really talked about disadvantages. But one of the one of the real disadvantages is TMI, too much information. And as people start to put together a list of opportunities or lists of potential threats or SWOTs or strengths, if you get these lists to be incredibly long. I’m Italian so we can’t even see that on the screen I’m using my hands, but what you really want is to reduce the number of individual factors to get at those key points. So like I said, one of the big disadvantages is that you have too many answers and too many questions to answer. The other big disadvantage is when people really don’t prepare or when you spring it on some people. Or after the SWOT that people don’t really dig in and do the research that they need so the disadvantage is that SWAT involves people.
Well, Thank you for that. We’re just right on time so, I want to make sure we’re respectful of everybody’s time so thank you everyone for joining us today and Dr. Bilello, thank you for being here with ScienceDocs.