The WHYs and HOWs of Agile SWOT Analysis
A common mistake during switching to Agile is that an organization throws the baby out with the bathwater, discarding business strategy, values and practices that have benefited them so far. In order to avoid this, a SWOT analysis might come in handy.
Though used in traditional management, SWOT analyses in Agile is equally beneficial and advised. Using it properly can help prevent this mistake.
What is a SWOT analysis?
Coined by Albert Humphrey in the 1960s, the term SWOT analysis is an easy-to-understand tool for strategic business planning, used often in traditional ways of management; often prior to but also during decision making. SWOT stands for Strengths, Weaknesses, Opportunities and Threats. The goal of the SWOT framework is to identify internal and external factors that could help or hinder the organization in achieving its goals, be it on the project level or above, business operations, competitive advantage or other area.
Results are summarized using the SWOT matrix.
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How to conduct a SWOT analysis?
The two main steps are analysis and decision making/planning.
The main and most difficult objective of performing a SWOT analysis is mapping out the whole situation as accurately as possible. Practically there’s just no way to identify every single strength, weakness etc., so here’s a couple of tips that could help.
Define the objective as clearly as possible: Categories used by SWOT are too general; they need to be narrowed down.
Start with the external factors: Market factors can determine whether something should be considered a strength or weakness. Start by asking “what opportunities and threats exist?”
Extensive participation: Creating a SWOT analysis is not a one-man job. The more viewpoints are expressed, the better the results are going to be.
Dialogue: Dialogue is an essential part of a good analysis, so spare no time and effort allowing for it.
Balance: If the matrix is suspiciously one-sided, it’s worth going with at least 5 elements per category.
The matrix you get by conducting the analysis is still not enough for success. You need to assess the results as well. The ways to do that are plenty with their usefulness, depending on the original question that made the whole analysis necessary.
If it was an open question (like what kind of product should we develop), there’s a wider variety of possible questions based on the matrix. For example:
- What opportunities are made easier to use by our current strengths? Identifying these could get us ahead of competitors.
- How can we avoid threats? How can we avoid having to face our weaknesses? Questions like these can point towards strategic change, even perhaps entering a new market.
If the analysis is conducted after the decision, questions should focus on implementation.
- What particular strengths are important to reach a given objective?
- Which of our weaknesses constitute the biggest threats and what are we doing against them?
- Which opportunities must be used at all costs to reach our goal?
All questions should be examined in the context of the whole matrix, even though they might seem to focus on particular areas. A SWOT analysis is not just another meeting. It always shows the organization’s knowledge at the moment it’s being conducted. Given this, it’s worth repeating it regularly, especially in an environment that constantly keeps changing.
SWOT analysis in an Agile environment
Even though it is a tool used primarily by traditional management, Agile can benefit from it as well. SWOT analysis in Agile can be used when transitioning to Agile, at the beginning of product development, before new releases, or during product or team level retrospective meetings.
Additionally, SWOT analysis in Agile can be of great use when we as Scrum Masters or product Owners feel like our team is out of balance either because of being overly confident or due to the lack of motivation. Emphasizing internal strengths and weaknesses can help re-balance the team.