The Importance of a SWOT Analysis for your Nonprofit

Social Solutions Blog

The Importance of a SWOT Analysis for your Nonprofit

With origins dating back to the 1950’s, the SWOT analysis was developed as a method for evaluating a company or organization’s internal strengths and weaknesses against their external opportunities and threats; hence the acronym SWOT which stands for Strengths, Weaknesses, Opportunities and Threats. A lot of you may be asking, what is a SWOT analysis really? Or if you do understand what a SWOT analysis is, you might be wondering how to apply it to your organization. For those of you that are currently using a SWOT analysis, sit tight, because I will also talk about building a better one!

Initially introduced by Stanford University’s Albert Humphrey, and Harvard Business School Policy Unit professors – George Albert Smith Jr., C Roland Christiensen and Kenneth Andrews; the SWOT was developed for usage and application to organizational strategy as opposed to marketing.  Over time, the simple tool has been broadly adopted as the go-to tool set for understanding changes impacting the inside or outside of a business, organization or even a nonprofit.

To get a better understanding of the SWOT acronym, let’s break it down. According to Wikipedia, the definition is as follows:

  • Strengths: characteristics of the business or project that give it an advantage over others.
  • Weaknesses: characteristics that place the business or project at a disadvantage relative to others
  • Opportunities: elements that the project could exploit to its advantage
  • Threats: elements in the environment that could cause trouble for the business or project

Based on this definition, it is easy to see how SWOT can be applied to almost any type of business or project. If you are starting a new nonprofit or have an established one, the SWOT analysis can be used to fine tune your goals and strategies.

For existing nonprofits, a SWOT can be used at any time to rapidly evaluate changes in your organization, system, process, competition, funding and help build a proactive plan for how you will respond, act, or face those changes. Most marketing professionals, for example, conduct a SWOT analysis at least once a year to shape the upcoming year or quarter’s marketing strategy.

For those that are interested in using a SWOT analysis or simply building a better one, I will leave you with 3 simple tips:

  1. Be honest with yourself. And if you find that you are consistently building a SWOT based on what you want to do, or how you want to be, then ask members of your staff to independently do their own version. The results may open your eyes!
  2. Take the time to actually do a careful SWOT. I know that every nonprofit has limited time, BUT this is one exercise, when done properly, could actually save your valuable time in the end. Imagine not wasting precious time or dollars on ineffective strategies, decisions or marketing plans because you spent the time upfront to build a solid SWOT analysis.
  3. Make sure you have facts to back up your SWOT. If you want your team to stand behind you then you need to provide solid data to support your SWOT analysis. Theories, hunches or gut feelings will only go so far in motivating a team.

And finally, have fun, and know that the work your nonprofit is doing is extremely important and tools like the SWOT analysis can go a long way in ensuring you are getting your message and mission out to the world.

If you have other tips or tools you would like to share, feel free to let us know in the comments below! We look forward to hearing from you!

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