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Two of the basic tools taught in business schools are to perform a global analysis of a company. The most popular analyzes are SWOT (or TOWS) and PEST (often with LoNG). The first looks at the more local problems of the individual company in a micro sense, while the second looks at larger problems in a macro sense. These tools were first thought of and introduced in the 1950s by Albert Humphries in the 1950s while he was at Stanford University (although some of the original authors aren’t particularly clear).
Very useful tools without a doubt, but before working on them, it is important to brainstorm among the stakeholders of the organization that is being analyzed. By looking at the stakeholders, it helps to clarify the situation and who might be affected by the various factors, both external and internal in nature. Brainstorming techniques are a good way to gain understanding to move forward with the analysis. Also, consider the raison d’être of a business or organization.
PEST analysis is a look at the bigger macro picture of what affects the environment of the company or organization. This is often combined with LoNG to create LoNG-PEST analysis. It is an acronym that stands for Local, National and Global (LoNG) and Political, Economic and Technological impacts. So, with that in mind, there are a total of 12 elements that need to be considered and thought through in the analysis, taking into account the macro implications for the company, its stakeholders, the environment (from the very local to the international). Please note that the LoNG-PEST analysis was conducted with the company in mind, focusing on the industry or business in which it operates, but incorporating information and trends from other industries.
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SWOT analysis is also known as TOWS and is another acronym used in the mico scale of the individual company and organization. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. In this analysis how the company could be affected by each one. Use the above information that was generated in LoNG-PEST to help identify the factors that affect the business. This time it is at a very micro level that the analysis is carried out with individual factors that currently affect the company or problems that have a high probability of affecting the company in the near future. The organization’s strengths should look to where the obvious strengths are, including the competitive advantage it possesses. Opportunities are both internal and external to enhance strengths, create new strengths, and enhance the organization’s raison d’être. Weaknesses are those that detract from strengths, hinder opportunities, and generally hurt overall performance. Threats are those that threaten the organization, both internally and externally (a LoNGPEST review is often helpful in recognizing threats).
Remember, these analyzes are to help you look at your organization and have the ability to see trends and when they might fit into organizational structures. The issues you need to address are often the ones that may or may not immediately come to mind. But, with the help of doing an analysis, you often get an idea when they are used. While avoiding analysis paralysis, use these simple tools to better understand and prepare your organization for the future.