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Business Analysis Techniques by Paul Turner, Debra Paul, James Cadle

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BUSINESS ANALYSIS TECHNIQUES
the situation perhaps enhancing the product, or selling it in a different
market in order to generate a higher volume of sales or greater profitability.
Both of these courses of action would require investment, so the prospects for
improvement would need to be assessed carefully.
Where a product has been identified as a problem child’, action to rectify the
situation will need to be considered; with careful development it may be
possible to move the product into a ‘star position. For example, it may be
possible to change the approach to marketing the product in order to
enhance the market’s perception of it and thus increase sales.
One of the issues with the Boston Box is the level of granularity of the product
assessment. There may be some products that do not fit neatly into a particular
quadrant, but are on the cusp between two. When using this technique it is
important that a commonsense approach is adopted and that other factors are
taken into account. For example, if a product is assessed as having medium
market share and low growth this might not be because of an inherent problem
with the product. It could instead be a question of timing and market conditions.
The action that would improve the situation might simply be to manage the
product carefully until the market conditions change.
STRATEGY DEFINITION
Technique 6: SWOT analysis
Variants/Aliases
A variant is TOWS analysis (threats, opportunities, weaknesses and strengths).
Description of the technique
SWOT analysis is used to consolidate the results from the external and internal
business environment analysis. SWOT (see Figure 1.4) stands for:
Figure 1.4 SWOT analysis
Strengths
– will aid the
development of the
organisation
Opportunities
– available to be
grasped by the
organisation
Weaknesses
– will undermine the
development of the
organisation
Threats
– presenting
potential problems
for the organisation
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BUSINESS STRATEGY AND OBJECTIVES
Strengths the internal positive capabilities of the organisation, for example
nancial resources, motivated sta or good market reputation;
Weaknesses the internal negative aspects of the organisation that will
diminish the chances of success, for example out-of-date
equipment and systems, unskilled sta or poor management
information;
Opportunities the external factors that present opportunities for success,
for example social changes that increase demand for the
organisations services, or the development of technology to
provide new service delivery channels;
Threats the external factors that have the potential to harm the
organisation, for example a technological development that
could enable new competitors to enter the market, or economic
difficulties leading to a reduction in market demand.
Using SWOT analysis
SWOT is used to summarise and consolidate the key issues identified when
analysing an organisation and its business environment. It follows the use of
techniques such as PESTLE (external) and Resource Audit (internal).
Once the SWOT has been developed it is then used as a means of evaluating the
organisations business situation and identifying potential strategies for the
future. A standard approach is:
Identify the new business improvements made possible by the opportunities
de
fined in the SWOT.
Identify the business issues that may arise from the threats defined in the
SWOT.
Consider the actions required to grasp the opportunities and address the
threats.
Identify the areas of strength that will enable the organisation to carry out
these actions.
Identify the areas of weakness that could undermine any action taken.
Develop and evaluate strategic options for delivering success based on the
previous steps.
SWOT analysis is often employed in workshops, where techniques such as
brainstorming are used to identify the elements in each of the four areas.
However, this approach is not rigorous and can be too informal to produce a
comprehensive SWOT. There is the risk of missing significant factors, such as a
looming threat or a major area of organisational weakness. A better approach is
to use formal techniques to derive the SWOT, which helps to ensure that all
relevant areas are considered and the key issues identified. Using techniques
such as PESTLE, Porters Five Forces and Resource Audit will provide a more
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