Over the last seven months we’ve discussed many topics, such as: the emergence of artistic entrepreneurship in the new economy; the importance of demanding fair value for your creative contributions to society; tools of empowerment (e.g. clarity, action); the importance of strategic business planning in the arts; the merits of analysis (industry, market, and competitive); finding a blue ocean strategy; and owning your professional identity.
Are you overwhelmed yet?
You’re not alone.
At this point my students and clients are spinning with the magnitude of possibilities and choices available to them. It’s exciting to discover all the ways you can achieve your dreams, especially after benchmarking peers or peer organizations that have actually done it. However, it is also common to feel paralyzed by options.
Yes, you’ve finally “turned on the light” and clearly see the playing space before you. You finally have a comprehensive view of who the players are and how they collectively function, who your market is and how they behave; but you haven’t yet figured out:
“Where do I want to be in this world?
“How am I going to function in this environment?”
This is when you have to ground yourself in a process called, situational analysis.
Sound scary?
It isn’t.
Conducting a good situational analysis can actually provide comfort. I liken it to the feeling of coming off a six-month-two-city-per-week tour, unlocking the door of my Brooklyn apartment, dropping my ridiculously heavy luggage, and sighing: “Ahhhh….Home.” On tour, I was constantly moving from place to place, trying to decipher unfamiliar territory and figure out how to function.
In Brooklyn, I knew my way around, had my routines, and could execute strategies for daily operation. The situational analysis gives you that same calming sense of place and how in your industry and/or market.
So let’s begin.
Two useful tools for understanding where you exist in the world are: the SWOT Analysis and the Resource-Based View of the Firm (your career). I will discuss the SWOT analysis and leave the Resource-Based View description for a future posting.
A SWOT Analysis allows you to determine strategies for optimizing your strengths (S), compensating for your weaknesses (W), taking advantage of opportunities (O) and warding off threats (T).
Step 1: List all the opportunities and threats in your new found world.
The research and analysis on your industry, market and competition should have exposed some opportunities and threats. Sit with the information and brainstorm a list of these items.
Example: DIY Theatre Company’s market research revealed that a new IT park development is attracting professional singles to their metro-area. This demographic has a lot of discretionary
dollars to spend on entertainment, because they generally don’t have the expense of children and tend to frequent places they can meet other singles (e.g. bars, clubs).
Clearly, there is an opportunity to provide entertaining spaces to this target group. Additionally, their research exposed a 10% increase in bars and clubs in the metro-area, which the company sees as a competitive threat.
Step 2: Do an honest assessment of your strengths and weaknesses.
Be very honest with yourself, especially about your strengths. You’d think it would be hard to see our shortcomings, but often times we are blind to our power.
Example: Improvisational sketch comedy is a key strength of DIY’s young professional actors. However, they’ve only used it for public school performances, which is their current bread and butter gig. DIY’s major weakness is a lack of space. Without a consistent venue to present work, it is difficult to build a ticket purchasing patron base.
Step 3: Create a matrix of your strengths, weaknesses, opportunities, and threats; then determine your strategies.
Example:
Strengths | Weakness | |
Opportunities |
|
|
Threats |
|
|
S-O strategies - pursue opportunities that fit your strengths. For example, DIY could create edgy comedic programming that caters to young professionals.
W-O strategies - overcome your weaknesses to pursue opportunities. For example, the company could partner with a venue to present a weekly sketch comedy show, with edgy content like an interactive
dating game. They could brand the show as the premier dating event for young professionals who don’t like to dance at clubs.
dating game. They could brand the show as the premier dating event for young professionals who don’t like to dance at clubs.
S-T strategies - identify ways to optimize your strengths and reduce your vulnerability to external threats. For example, the company could partner with their potential competitor; a new bar in town. DIY would produce and promote the weekly sketch comedy show in return for all the cover charge revenue. (Leaving food and drink revenue for the bar).
W-T strategies - establish a defensive plan to prevent your weaknesses from making you susceptible to external threats. For example, the company could sign a multi-year contract with the bar to mitigate the loss
of space, and look for opportunities to buy ownership in the bar (or another bar) as net profit increases.
of space, and look for opportunities to buy ownership in the bar (or another bar) as net profit increases.
Of course, this is a very simple example of a situational analysis, but I hope it illustrates the value of using this tool. Additionally, I hope it provides some clarity about how to ground your self in newly discovered industry and/or market space. Ultimately, I hope you find that“Ahhhh…..home” feeling in your new found world of opportunities.
(One caveat - find you grounding, but never stop scanning your environment and adjusting to inevitable changes; or you will struggle to remain relevant and sustainable.)
Reference: http://www.quickmba.com/strategy/swot/
(Originally published on FracturedAtlas.org March 1, 2009)
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