The SWOT tool is used in all areas and functions in business such as strategy, operations, supply chain, marketing, quality control and human resources. The objective is always the same: to identify important strengths and weaknesses as well as define and assess threats and opportunities.
The four parts of SWOT are very important for any company and every manager. The strengths and weaknesses are internal factors while opportunities and threats are mainly external forces where the organization has no influence or very limited impact on those forces.
SWOT analysis is very important for the human resources department in order to assess the current position and fit of the current employees in the company with the current external factors. The SWOT analysis is an efficient and effective planning tool for HR.
HR SWOT Analysis Process:
1. The process starts by defining the overall organizational objectives and the HR strategy.
2. After strategies and objectives are clear next is brainstorming and making a list of important factors in all of the four areas of SWOT.
3. Once the list has been developed for each of the four areas the factors should be grouped and segmented into a related groups with factors that share common objectives, risk and issues. This is usually done working in a team and going from one area to another until all four are completed successfully. At this point our analysis is actually a current situational analysis – nothing has been done and nothing has been changed however we have a starting point for developing effective strategy.
4. Next we need to perform gap analysis. Based on the previously defined overall strategies and objectives in Step 1 we can build an ideal picture of what would be the best case scenario for HR in order to satisfy those objectives. Now we have the ideal situation on one hand and the current or existing position on the other hand and we are ready to do our gap analysis. The gap analysis defines the alternatives for change and moving HR from the existing state towards the ideal case scenario. Generally you would not be able to build the ideal situation but you can move towards that direction and achieve a significant improvement which is the overall goal of human resources SWOT analysis.
Here are some tips to help you with the process of using SWOT analysis:
1. Strengths are internal factors and in most cases the organization has a full control over them. In addition strengths are the differentiators for your company like unique skills and competencies which are really important and valuable. “Strengths” which can be found in most of your competitive organizations are hardly any strengths at all.
2. Weaknesses should be defined as internal factors which your company can control and these are the critical points which prevent your organization to perform better in terms of achieving the strategic goals and objectives.
3. Opportunities are external factors over which your company has no or little control but they are favorable to your organization. Current trends and changes can impact your organization in a good way and you need to identify those forces and develop alternatives on how to take advantage of those opportunities.
4. Threats are also external forces which you generally cannot control. Threats come in variety of ways such as technological, political, economic, demographic, etc. In such a scenario generally you would not be able to completely eliminate them but you should develop strategies and tactics to minimize the risk or avoid the threats as much as possible.
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