Time to leverage planning tools

One of my biggest concerns over the years of consulting in the Gulf Cooperation Council (GCC) has been that since liquidity has never really been a problem, management discipline in formulation and deployment of strategy has generally been weak.

For the last eight years or so, the GCC markets have been growing, and therefore it has become easy to ride the wave. Planning and cost discipline have taken a second priority. I, however, feel it is time to leverage all the planning tools and one of them is SWOT.

Strengths, Weaknesses, Opportunity & Threats (SWOT) as an analysis technique was created to identify as to why corporate planning failed. Harvard research found that 90 per cent of US firms that can formulate can't implement.

SWOT can be used along with other tools in the strategic planning process. SWOT is a tool often used for auditing an organisation and the environment. It is the first stage of planning and helps marketers focus on key issues. Strengths and weaknesses are internal factors, Opportunities and threats are external factors.

A strength could be your marketing expertise, a new product of service, your location, your processes, etc. A weakness the reverse of some of the above factors. Opportunities could include developing new markets, joint venture opportunities. Threats could include new competitors, price wars, taxation, etc.

SWOT analysis can often be very subjective. You cannot rely only on it. It is only one of the tools. Two people rarely come up with the same SWOT.

Here are therefore some simple rules when doing a SWOT:

• Try to be as specific as possible and avoid grey areas.
• Always apply it in relation to your competition i.e. better than or worse that your competition.
• Keep it short and simple. Avoid complexity and over-analysis.
• No matter what you do, it will always be subjective.
• Be honest about the strengths & weaknesses of your organisation.
• It should help you distinguish where your organisation is today, and where you want it to be.

SWOT is one of the tools used in the strategic planning process. The big issue always on the table is where the responsibility for formulation strategy or doing SWOT analysis sits?

My firm belief is that nobody knows their SWOT better than the management team, however it needs an expert or an independent unbiased unit to monitor, guide the process, and that happens to be a strategic planning unit.

Middle East financial services organisations have rarely invested in this unit, and many are just starting to put strategic planning units into place. SWOT exercises can be moderated by strategy planning in a session attended by the senior management team of a business unit or the overall unit.

Remember SWOT can be done not only for a company, but also for a product, and even on yourself as a personal development planning tool. With Middle East financial services markets becoming highly competitive, it is time to plan carefully and use tools like SWOT to their maximum.

- The writer is the managing director of Cedar Management Consulting International.

He can be reached at Sanjiv.Anand@cedar-consulting.com