How to do a dynamic SWOT

A dynamic SWOT refers to an analysis that allows for continuous adjustment or updating as the company’s internal and external circumstances change. Instead of being a static analysis, a dynamic SWOT integrates changes in the competitive environment, technological advances, regulations, market trends, and other factors that affect the company's strategy.

Previous recommendation: First, read this post on "how to properly conduct a SWOT analysis."

Let’s go over the four key points, one by one.

1. Continuous Monitoring of KPIs

The first thing we need to do is define the metrics or KPIs to measure how our internal Strengths and Weaknesses evolve, and how external Threats and Opportunities shift. Here are some examples:

a. KPIs for Strengths (examples):

• Team productivity: Measures the performance of key personnel or teams, considering indicators like the number of tasks or projects completed within a given period.

• Customer satisfaction: If customer loyalty is a strength, the KPI could be the Net Promoter Score (NPS) or satisfaction surveys to monitor if customer perceptions remain positive.

• Customer retention rate: If customer loyalty is a strength, monitor the percentage of customers who continue to purchase or use the company's services over time.

  
  

b. KPIs for Weaknesses (examples):

• Non-conformance cost: If a weakness is the lack of quality control, this KPI measures the costs associated with errors, returns, or defective products.

• Employee turnover rate: If a weakness is talent retention, this KPI measures how many employees leave the company within a specific period.

• Response or delivery times: If a weakness is slow response times to customers or product deliveries, use a KPI that tracks the speed of response or delivery and how it improves over time.

c. KPIs for Opportunities

• Market growth: If an opportunity is identified in a new market niche, KPIs might include sales growth in that segment, the percentage of market penetration, or market share acquired.

• Adoption rate of new technologies: If the opportunity involves adopting technology to improve processes, this KPI measures the percentage of departments or employees successfully adopting the new technology.

• Revenue from new products or services: This KPI measures the revenue generated from recently launched products or services, as part of a strategy to seize an identified market opportunity.

d. KPIs for Threats

• Competitor monitoring: If a threat comes from aggressive competitors, the KPI could be a comparative sales or market share analysis, measuring how well the company is keeping up with competitors.

• Complaint rate: If the threat involves changing customer expectations, the KPI could be the number of complaints or claims received about products or services, reflecting whether the company is losing competitiveness.

• Impact of regulatory changes: If a threat is identified as a change in laws or regulations, the KPI could measure how quickly the company adapts to new rules, monitoring compliance.

2. Constant Feedback

   • Use real-time data (e.g., market studies, satisfaction surveys, sales) to adjust the SWOT analysis.

   • Implement a constant feedback system with customers and experts to understand potential threats (negative reactions) or unseen opportunities.

3. Periodic Reevaluation

   • Review the SWOT at set intervals, such as quarterly (ideally) or after significant events (a new competitor, changes in laws, etc.). This allows for quick strategy adjustments.

4. Prospective Scenarios

   1. Include scenario analysis to prepare dynamic responses to potential threats or changes in the environment. For example, what would the company do if a side effect is discovered in an ingredient of their cosmetic product?

5. Tools and Solutions for a Dynamic SWOT

   • Market Monitoring Platforms: Tools like Google Trends or social media analytics platforms can detect changes in consumer preferences.

   • Sentiment Analysis on Social Media: AI tools that analyze how consumers perceive the product can provide insights into emerging threats or weaknesses.

   • Real-Time Dashboards: Implement internal dashboards to visualize, in real-time, changes in sales, regulations, or new trends affecting the company’s environment.

A dynamic SWOT is a flexible and adaptable approach that uses modern tools to constantly update itself, reacting to market changes and improving the company’s strategies. If you’re interested in developing one with more specific data or adapting this idea to a particular tool or report, I can help you design it.

Is it confusing? You’ll see it clearly with a real case.

Download the case study!