To Err Is To Be Human

The Startup Business Systems SWOT Analysis

When we hear or see the word “system”, what comes to your mind?

Well the dictionary meaning has it along the lines of a set of procedures, principles, frameworks or set of things working together to provide an overall outcome.

In the business context, you can think of systems as a way to ensure things are being done consistently and at the acceptable level of quality. In the startup world, I think systems are essential as they help educate on the “what to do” and the “how to do” and also a critical but overlooked area is in ongoing assessment of business performance. What are your strengths and weaknesses? What are the opportunities in front of you and also the possible risks and threats? In other words, the S.W.O.T Analysis (strengths, weaknesses, opportunities, threats).

We often seek out the next bright and shiny object as the solution to our problems, but I think the SWOT Analysis is an elegant method of assessing where you are at, particularly if you are doing this annually in your business or startup of which the outcomes of the analysis can feed into a plan or more formally the annual strategic business plan.

According to Wikipedia there are differing views as to the original author of the SWOT Analysis but it was around the 1960’s and 1970’s when it first appeared. Like many systems or frameworks, the appearance of simplicity is deceiving as what the SWOT Analysis does, is it looks at both internal factors and external factors and their relative strategic fit.

The other great thing about the SWOT Analysis is that it is simple to perform. Like you can do this on your own having coffee! In fact right now quickly write down your number one answer to the following four questions:

1. What is your biggest strength?
2. What is your biggest weakness?
3. What is your biggest opportunity?
4. What is your biggest threat or risk?

See, simple! Even with myself writing this article, I have quickly reflected on the answers to those questions for my own circumstances.

Of course it is a better idea to engage your colleagues and workshop this in more detail and even consider themes such as the following:

  • Financial
  • Resources
  • Intellectual Property
  • Individual Capabilities
  • Leadership
  • Location
  • Technology
  • Competitors
  • Suppliers
  • Partners
  • Economic Cycles
  • Political Landscape etc etc

Perhaps some of the points raised need to be validated to see if they are actually true or not and then of course you can use differing ways to filter or prioritise. Regardless, can you see how the SWOT Analysis could be helpful to you in your business? Also you don’t have to engage a management / business consultant to do this either!

Of course there are other systems, frameworks or models that can be used instead of the SWOT Analysis and some of these include…


Porter’s Five Forces Model

  • Threat of new entrants
  • Threat of substitute products or services
  • Bargaining power of customers (buyers)
  • Bargaining power of suppliers
  • Intensity of competitive rivalry


VRIO (Value, Rarity, Imitability, Organisation)

The Question of Value: “Is the firm able to exploit an opportunity or neutralize an external threat with the resource/capability?”

The Question of Rarity: “Is control of the resource/capability in the hands of a relative few?”

The Question of Imitability: “Is it difficult to imitate, and will there be significant cost disadvantage to a firm trying to obtain, develop, or duplicate the resource/capability?”

The Question of Organisation: “Is the firm organized, ready, and able to exploit the resource/capability?” “Is the firm organized to capture value?”


Six Forces Model

  • Competition – assessment of the direct competitors in a given market
  • New Entrants – assessment in the potential competitors and barriers to entry in a given market
  • End Users/ Buyers – assessment regarding the bargaining power of buyers that includes considering the cost of switching
  • Suppliers – assessment regarding the bargaining power of suppliers
  • Substitutes – assessment regarding the availability of alternatives
  • Complementary Products – assessment of the impact of related products and services within a given market


McKinsey 7S Framework

Hard Elements

  • Strategy
  • Structure
  • Systems

Soft Elements

  • Shared Values
  • Skills
  • Staff
  • Style


Now as you can probably conclude by now, I love systems and models (I also love a good graph too). Having been a management / business consultant for many years working in the corporate sector, models were part of my kit bag. However in the startup entrepreneurial space, things are slightly different, that’s why my number one model is this one:

K.I.S.S or Keep It Simple Stupid!

Meaning, sometimes we can over complicate things or over engineer them, so finding the balance is important. Even though all the models that I have mentioned (and trust me on this, there are hundreds more – even ones I have created) allow great insight into your business, the SWOT Analysis therefore, is a good one to start with.

Remember, you just need to ask yourself these questions consistently and diligently each year: what are my strengths, my weaknesses, my opportunities and my threats.

Then of course you need to define and refine what you are going to do about it all, that is, the execution of the outcomes or findings.

However, that my friends, is of course another story for another time, because somehow, even when we have the insights and the answers, we still do not take action! Possibly this phenomena, if we call it that, explains the quote: “to err is to be human…”!

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