EXECUTIVE SUMMARY:
Most business leaders are familiar with SWOT, a tool for identifying internal strengths and weaknesses alongside external opportunities and threats. The challenge is that SWOT often stops at analysis without providing a clear path forward. TOWS takes the same elements and finds the intersections, pairing internal and external factors to generate actionable strategies. By moving from observation to implication, TOWS helps leaders reduce risks, seize opportunities, and align strengths and weaknesses with the realities of their environment.
You may have heard of SWOT (Strength, Weaknesses, Opportunities, Threats), but do you know TOWS (Threats, Opportunities, Weaknesses, Strengths)? Let’s walk through the intent and benefits of SWOT, and then take a look at an expanded version of it where you can explore implications in a structured manner.
I have recently been serving as a teaching assistant for Professor Areen Shahbari for some graduate-level courses at Harvard University. In her business strategy courses, it’s common for someone to have already heard of SWOT. But I love seeing eyes light up when the professor teaches the less commonly known TOWS, as my own eyes did when I first heard about it in her Strategic Management course. I’m excited to share it with you today.
What is SWOT?
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. SWOT is used to evaluate a company’s… you guessed it… strengths, weaknesses, opportunities, and threats. What’s tricky is that it’s almost too user-friendly. It sounds straightforward.
Here’s a piece many miss, though:
Strengths and Weaknesses are internal. They reflect what the company controls. Examples:
Strengths: brand reputation, proprietary technology, strong cash flow, loyal customers, operational efficiency.
Weaknesses: high cost structure, weak online presence, gaps in talent, outdated IT systems, low marketing budget.
Opportunities and Threats are external. They come from the environment around the business. Examples:
Opportunities: growth of a specific industry, favorable regulations, emerging technologies, untapped geographies.
Threats: new competitors, supply chain disruptions, changing consumer preferences, stricter regulations, economic downturns.
So that’s SWOT. What is TOWS?
“First described by Heinz Weihrich in 1999, TOWS takes a SWOT analysis one step further to help you take action with your findings. The TOWS acronym uses the same elements as its predecessor, but in reverse order. It combines internal and external forces to come up with productive ideas of how to best use the information. The main purpose of a TOWS is to reduce Threats, take advantage of Opportunities, exploit Strengths, and remove Weaknesses”.
In short? TOWS allows you to shift from a SWOT Analysis to implications and actions.
Here are some examples:
S/O: With a Strength of operational efficiency and an Opportunity of untapped geographies, a company could enter a new geography with the same business model.
W/O: With a Weakness of talent and an opportunity of more favorable regulations, a company could hire expert contractors to help them take advantage of changes in regulations.
S/T: With a Strength of proprietary technology and Threat of new competitors, a company could protect their market position by offering unique features.
W/T: With a Weakness of poor online presence and Threat of changing consumer preferences toward online shopping, a company could make investments in their eCommerce marketing.
Wrapping It All Up
SWOT is a great starting point for understanding where your business stands, but TOWS pushes you to translate that knowledge into strategy. By pairing internal factors with external realities, you can uncover concrete actions that protect against risks and unlock new growth opportunities.
When was the last time you did a SWOT analysis? Is it time you refreshed it and took it one step further with TOWS this week?
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