Quantitative SWOT analysis – a simple database for executives

BCG SWOT is a great strategy definition tool. In a SWOT analysis, an organization’s internal strengths (S) and weaknesses (W) and the external opportunities (O) and threats (T) are defined and marked in a tabular format. Some organizations take full advantage of their SWOT analysis and use their strengths to benefit from opportunities, control and mitigate threats and cope with the impact of their weaknesses.

Risks are any unwanted, negative events that may happen. We always hope for the likelihood of the risks to be zero and the impact of the event to be both low and mitigable. Risks have a direct impact on a project’s triple constraints; scope, cost and schedule. Risk assessment is always used in project management and it is an essential skill for any top executive. 

As organizations aim to benefit from external opportunities, there are external contingencies, or threats. There are also unpredictable internal issues, or weaknesses. Both of these can impact the outcome of a business strategy. Risk assessment can also be used in combination with a SWOT analysis to combat the weaknesses and threats of the organization. It is also used to assess the strengths and opportunities of the organization. 

A visualization of risk and impact

In a typical SWOT analysis, the external occurrences are put on a scale of high to low probability and impact. The two categories can easily be replaced with numerical values of probability and monetary values for impact. Each item should have four attributes; validity, probability, impact and impact value. Validity regulates the contribution of an item to the SWOT analysis estimation. If an item is no longer valid, the impact should be changed to zero. New items can also be added to their appropriate categories if needed. Strengths and opportunities have a positive impact value, whereas weaknesses and threats have a negative impact value. Each organization should have their own methods to define the numerical values for probability, impact and impact value of an event. The weight of an event and an estimated monetary value (EMV) are also calculated. An example of this type of assessment is shown in the database table below.

An example of an assessment for probability, impact, impact value, weight and estimated monetary value (EMV)

Based on the quantitative SWOT analysis, a report is compiled. An example is given in the table below. The table design should be customized to fit an organization’s needs. This type of SWOT analysis allows organizations to analyze their business strategy in a new light. Using clear metrics is an advantage that allows organizations to use data to drive their business. If you would like to discuss SWOT analysis in more detail, you can contact us here.

A final SWOT analysis report