TOWS analysis

The method extends a SWOT by building strategies out of what the SWOT analysis told you.

You build them by crossing the factors on one of the SWOT's lists with those on another.

When to use it

  1. When you want to turn what came out of a SWOT into concrete answers.
  2. When what interests you is where the venture could go, and short- to medium-term planning.

When not to use it

  1. When no SWOT analysis has been run.
  2. When what you need is to solve today's problems rather than plan new work.

The goal: used well, the tool names a set of strategies you can actually put in place to grow the venture or the organisation.

How to use it

A TOWS analysis pulls out four sets of strategies for a given venture.

1. Ground rules — what to keep in mind

  1. That you want systemic strategies: ones that address the organisation's opportunities and threats while taking its internal strengths and weaknesses into account.
  2. That if a strategy rests on particular people and what they can do, this should be said plainly.

2. The kinds of strategy

TOWS gives four: WT (mini-mini), ST (maxi-mini), WO (mini-maxi) and SO (maxi-maxi).

2.1. WT — mini-mini

Crossing weaknesses with threats gives two kinds of conclusion:

  1. A list of strategies and markets not worth pursuing — worth checking that you are not in them already. If you are, withdraw where you can; at worst, consider winding the venture up.
  2. A list of things that, coming from outside, could bring the venture down because of how they combine with an internal weakness. Here you build early warning systems, and ask what would have to be new for the venture to withstand them.

2.2. ST — maxi-mini

Crossing strengths with threats gives strategies for setting the venture's strengths against an unfavourable environment — heavy natural competition, new legislation, and so on.

2.3. WO — mini-maxi

Crossing weaknesses with opportunities gives strategies for using favourable external conditions — an upturn, a boom in the sector — to work against internal weaknesses.

2.4. SO — maxi-maxi

Crossing strengths with opportunities gives strategies that make the most of what the venture and its environment have to offer. These are the ones that allow the fastest expansion, and the widest.

3. Running the meeting

  1. Define the purpose clearly.
  2. Let the team paraphrase it, to see whether it has been understood as clearly as you think.
  3. Go through the ground rules from point 1.
  4. Write out the key items from the SWOT (three of each is plenty).

Your team should be the people involved in the venture, between them responsible for all of it.

4. The analysis

Take each of WT, ST, WO and SO separately and ask whether there is a plausible strategy covering the pairs in that category. For ST, SO and WO the strategy rests on using the good in the venture and its environment, either to work against the bad or to make the most of the good.

WT is the exception: it does not rest on anything good. Here it is worth writing out the strategies that would leave the venture worse off than it is now.

5. Putting them in order

Work out which strategies matter most, because a venture rarely has the budget to take on all of them at once. Estimate what fixing a weakness is worth, and what exploiting an opportunity or a strength is worth — which is why concrete forecasts of gain and loss for each strategy matter.

6. Where to go next

A TOWS can be run as part of strategic planning. You then produce three TOWS diagrams: one for the past (a year back, say), one for now, and one for the future (a year ahead). Comparing them over time tells you whether a strategy is holding up.

Use it in TeamKit