The SWOT analysis technique is used to summarize your strategic analysis which includes both your internal and external analysis. This summary is classified into four categories. These four categories are Strengths, Weaknesses, Opportunities, and Threats.

Today, we’ll clarify the strength category for you, and also provide you with a list of common strengths you may encounter in your business.

The Golden Rule of Strengths: Strengths are characteristics of your business, they can only be identified in your internal analysis, since your internal analysis is the only type of strategic analysis that evaluates the characteristics of your business.

Now, let’s define strengths and take a look at typical business characteristics that are commonly classified as strengths.

Defined force: Strengths are the core capabilities of your business. These are areas where your business has an advantage over your competitor(s) that is valued by your customers.

In other words, strengths are features of your business that pass the test better than your competitors.

Key point recap: You will only find strengths by completing your internal analysis, a strength must be characteristics of your business.

Understand the strengths

Upon completing your internal analysis, you will find that your strengths will generally fit into two categories, tangible and intangible strengths. let’s look at them both

1. Tangible Strengths: A tangible strength is a feature of your business that can be accurately identified, measured, or realized.
2. Intangible Strengths: An intangible strength is a feature of your business that cannot be physically touched or measured.

Now, we’ll look at examples of common tangible and intangible strengths that can be found in your business.

Examples of tangible strengths

Your tangible strengths will tend to include characteristics about your business such as

• Your physical assets, including the plant, equipment buildings, and infrastructure
• Long-term rental contracts in good locations
• Unique or market leading products
• Access to sufficient financial resources to fund any strategic changes you would like to make
• Cost advantages over your competitors (This relates to your ability to provide the goods or services at a lower cost than your competitors. It does not refer to the selling price)
• Volume, loud volume can be a strength
• Ability to scale volume up or down with relative ease

Examples of intangible strengths

Your tangible strengths will tend to include characteristics about your business such as

• The strength of your brand(s), such as having strong, easily recognizable brands
• Your reputation in the market, including the market’s perception that you are a market leader or an expert in your field.
• The strength of your relationship with key customers, a strong relationship represents goodwill and is often seen as a strength.
• The strength of your relationship with your suppliers, once again, a strong relationship can be seen as a strength
• The nature of the relationship you have with your employees.
• Any unique alliances you may have with other companies that complement your company’s products or services in a way that is valued by your customers.
• Ownership of patents or proprietary technology can be a strength
• A proven advertising process that works well
• Have more industry experience in a field that requires some technical expertise, including the skill of your managers, your collective industry experience, and your profile in industry associations.

Where do people often go wrong?

The first area where it is common to see strengths misreported is in the language used to describe them. It is an easy mistake to write macro-environmental observation as strengths rather than opportunities, however this tendency should be avoided. For example, “One of our strengths is a strong economy,” this is truly an opportunity and can be rephrased as: “Economic prospects support growth.”

AND

Your business leaders typically complete a SWOT analysis. In completing their analysis, they are likely to rank their leadership abilities alongside their other strengths. Of course, it’s unrealistic that every leader in every business can pass the test of being better than our competitors. When faced with this self-assessment, it’s best to look for indicators like higher engagement scores, lower churn, and higher customer satisfaction to validate where you place leadership in the SWOT of your business.

Summary of SWOT Strengths

Your SWOT analysis summarizes the three strategic environments in which your business operates, they are your macro environment, your industry environment, and your internal environment. You will only identify strengths during your internal environment analysis, this is because your internal analysis is the only area where you will identify the characteristics of your business that pass better than the test of your competition. Strengths can also fit into two categories: they can be tangible, like plants and equipment, or intangible, like patents.

You will now have a solid understanding of strengths and how to identify them in your business.