Developing a strategy for a business is very simple when you use SWOT and combine it with the concepts of Quality, Cost and Speed.
The first step is to figure out your Strengths, Weaknesses, Opportunities and Threats for each of the three dimensions of Quality, Cost and Speed. For example:
- In terms of quality you may have a greater reliability than your competitor but less product choice. There may also be a new entrant to the market with newer technology going after a new market segment. Each of these is an element of SWOT.
- In terms of cost, you may have a more expensive product that is threatened by newer methods of production which could serve to make your competitor cheaper.
- Finally, for speed, you may have slower delivery times due to a slower manufacturing cycle time.
Figuring out strategy from SWOT would then have you do the following:
Very simply to develop strategy, you would maximize strengths, exploit opportunities, minimize weaknesses, and get rid of threats. In our simple example you might want to:
- Put in a new assembly line to lower costs of production and increase speed of delivery.
- Use the newer technology on that assembly line both to exploit new markets and broaden your product offering.
The hard part isn’t developing a strategy to beat the competition, it is figuring out what the problem really is in the first place.