It’s common in strategy discussions to do a SWOT analysis. I figure it gives us the feeling that we have covered all our bases so we feel like we have more control over events and circumstances.
And indeed a leader needs to be in control of whatever he can justly be in control of. After all, he’s going to be held accountable (either by his superiors or by reality or by those who report to him) for how he responds to what happens.
SWOT stands for
- Strengths
- Weaknesses
- Opportunities
- Threats
By taking the time to figure out what we are capable of, we can make better decisions about what we should do. By figuring out what we are not capable of, we can both improve what needs to be improved and avoid entering the lion’s den for which we aren’t equipped. Strengths and weaknesses become visible through an internal gaze, but they always relate to our purpose.
Opportunities and threats reside in the world around us. We can see opportunities when we look at the status quo and compare it with the past, thus identifying changes that have been taking place. Then, by analogy, we can project those changes into the future, speculate about what needs they will give rise to, and ask which of those needs we are suited or even called to respond to.
An example: the Gold Rush. In 1849, the status quo was that the whole world was rushing to California to get their bit of gold. The past told us that previously only a few people had. The need that would necessarily arise would be for shovels, picks, pants, and banks. Some people who were ready (I’m assuming this) were Levi, the jean guy, and Wells-Fargo bank. Somebody else must have made a vast fortune on shovels.
Not many people made much money on gold and those who did made it more or less by luck. The more reliable money was in pants, banks, and shovels.
This sounds simple, and in a way it is. It’s a lot simpler than random chaos anyway. But leaders spend endless time figuring out the way things are (status quo), the way things were, and what to expect next.
With the rise of probability and statistics, trends and expectations can be identified mathematically, if the assumptions inserted into the model work.
Then come the threats: Thieves, competition, and protestors: hurricanes, tsunamis, tornadoes, plagues.
Some are as predictable as the morning sun. Some might not come for generations. The latter are like dragons that sleep on their gold for ages and then suddenly rise up and find out who remembered them.
I heard about a business in Las Vegas that had employed 45 people. When the Coronavirus shut down hit, the leader had to release them all and surrender the business to fate. He informed them with tears, went home, and killed himself.
The last couple generations of leadership literature didn’t include much on that sort of thing. Follow your dream, and dream big! You get the impression that we are owed success if we follow the formulas because, well, it’s our birthright.
It is incredible what businesses have to deal with to survive and how much the owners put on the line. Sadly, one of the biggest “monsters” for most non-governmental leaders is government regulations, usually well-intentioned, always a burden, and often condescending, assuming the worst motives of the leader. After all, he only started a business to make money.
One way to deal with threats is what I call “the black bear strategy.” From Bearwise.org:
If a bear does approach you, make yourself look big, make loud noises, clap your hands, and continue to back away.
Sometimes that isn’t good for the optics, but it’s an approach.
Unfortunately, it carries a subtle temptation. When you grow big to survive, you often forget why you were born in the first place. A small business and a big business are two very different ideas. One thing that changes along the way: the personal is replaced by the abstract.
Wal-Mart and Panera are not organic parts of a local community, no matter how hard they try to be. Their values aren’t the same as those of the local community.
But when government regulations become a threat, you get more Wal-marts and Paneras and fewer Storheim’s.
That then leads people to believe that business exists for the purpose of making money, which leads to a bizarre pseries of psychological psteps, all ending in more regulation, less respect for businesss, more big business and less small business, and eventually more calls for government takeover leading to psocialism. I call it The Law of the Catastrophic Continuum.
The threats don’t go away. Certainty is unattainable. Leaders sometimes have to determine whether their duty is to survive or to do something. There are times when the cost of winning a war is a world worth living in.
