3 Best Alternatives to SWOT Analysis for Business Planning
Strengths. Weaknesses. Obstacles. Threats. SWOT analysis is out and these new frameworks are in!
Business planning is still important as it ever was, but times have changed. The way we go about business planning needs to update with the times. The SWOT analysis model has fallen out of favor as a strategic planning tool in recent years.
This guide will show you the limitations of SWOT analysis and what you can use instead!
Here’s What We’ll Cover:
Why SWOT Analysis Is Out
The SWOT technique has served many well but recently we’ve noticed the cracks in the armor.
- It Feels Negative
When you’re business planning, you want to have a positive outlook. Or at least a balanced one. SWOT analysis emphasizes the bad. Three of the categories are negative (weaknesses, threats and obstacles). It is important to keep your weak points in mind but a little positivity in the early stages goes a long way.
- What “Threat”?
Many experts criticize the severity of these words. "Potential threats'' sound like catastrophic events. “Obstacles” sound like immovable dragons to slay. All a bit dramatic isn’t it? SWOT feels more like a risk analysis technique rather than an action-orientated approach to future planning.
- SWOT Is Vague
The broad terms mean that you don’t go in-depth with your analysis. Everything is kept relatively shallow which is not helpful in business planning. You want your review of your business capabilities to be detailed.
Alternatives to SWOT Analysis
SCORE Analysis - Best Action-Orientated Approach
SWOT evolved into SCORE. The acronym stands for Strengths, Challenges, Options, Responses, Effectiveness.
Some experts criticize this for being too fluffy and idealistic. But “challenges” encapsulates weaknesses, obstacles and threats quite well. Challenges also feel more manageable and achievable than the negative terms in SWOT.
SCORE is a more proactive approach than SWOT. It leads you through potential obstacles and encourages you to generate responses for them. SCORE is also flexible enough to use on a micro-level for individual projects as well as broad scope business plans.
NOISE Analysis - Best Analytical Approach
NOISE stands for Needs, Opportunities, Improvements, Strengths, Exceptions.
“Needs” are the stand-in for weaknesses, challenges, threats and obstacles. Instead of thinking of things as roadblock, you reframe them as needs of the business. This could be a good thing or a bad thing. For example, “need clients” feels like a bit of a nebulous statement.
The “Exceptions” part is unique to NOISE. It is meant to encourage collaboration between teams. The idea is to think of exceptions to the rule. When in the past has the team overcome a challenge before and how can they do it again? These are useful questions when business planning.
NOISE is great for creating a strategic approach to business opportunities. You identify the needs of the business in order to take advantage of opportunities to solve them. This approach trains you to see potential growth.
Because of how this form of analysis is designed, it's best suited for the current situation. It works well for an established team that is planning for the next phase of the business. Rather than new businesses needing an action plan.
SOAR Analysis - Best Motivational Approach
SOAR is the most positive outlook for business planning so it won’t suit everyone.
The acronym stands for Strengths, Opportunities, Aspirations and Results.
No negative words at all. This is unhelpful for planning for problems. However, the more positive outlook is more motivating.
SOAR analysis is based on the principles of collaboration. The method encourages you to use the “six Is” of collaboration. Those are Initiate, Inquire, Imagine, Innovate, Inspire and Implement.
The biggest criticism of SOAR is that it’s a bit vacuous. The six I’s are vague business buzzwords. That’s not to say it won’t work for you and your team. It completely depends on your ethos and company culture.
The commonly-used SWOT analysis is a classic business tool. It's fair to assume that most major corporations today started with a SWOT analysis. That was just the done thing at the time. But now there are so many different ways to approach business planning. The most effective tool is the one that suits your business plans and company culture the best.
For more business planning guides like this one, head to our resource hub!