Please set up your API key!

The Rough Notes Company Inc.



July 27
09:02 2017

Agency Financial Management

 SWOT analysis is a powerful tool for identifying and resolving problems

 As product specialists, managing general agents, and underwriters contemplate the future, they face more uncertainty than ever. Technology continues to transform every aspect of the insurance business. Turmoil in Washington has us all wondering where everything from regulatory oversight to taxes to interest rates will stand in a year. Even those in the industry who embrace the value of planning may be unsure of how to begin the process.

I’d recommend a practical approach using a time-proven tool and delegating the responsibility for it to your team. That tool is the SWOT analysis, a simple but surprisingly insightful technique that’s been around for the past half-century. Performing a SWOT analysis of your business is an excellent way to discover what you’re doing well and where you need to improve, and to create a framework that will help you respond to whatever shakes out of the current uncertainty.

Having each of your employees develop his or her own SWOT analysis, and then combining the analyses and debating the findings, will create a framework that incorporates more points of view and can give each team member a stronger sense of his or her own role and responsibilities in helping your business succeed (as well as buy in to the plan.)

Four factors

SWOT is an acronym for the four factors detailed in the analysis: strengths, weaknesses, opportunities, and threats. Although business plans often swell to book-length documents, the most useful SWOT analyses are quick summaries, often using bullet points rather than full sentences and paragraphs. That doesn’t mean they’re insubstantial or meaningless; actually, the opposite is true. By using fewer words, a SWOT analysis sharpens the impact and focus.

Strengths and weaknesses are internal factors—the resources and the experience levels that are currently available to you. Human, financial, and physical resources are a few examples of areas typically assessed. Processes, programs, and systems also may be taken into consideration.

The only valuable SWOT analysis is one that’s brutally honest, and your team is better equipped to tell you what’s working and what’s falling short.

Opportunities and threats, on the other hand, are external forces that are beyond your control or the control of your company. These may include market and economic trends, political and economic policies, and more.

 Having your team do the work

As an owner or manager, you could easily develop your own SWOT analysis. But there’s much value to be gained by turning the task over to your team. Frankly, the only valuable SWOT analysis is one that’s brutally honest, and your team is better equipped to tell you what’s working and what’s falling short. They already think about these things every day, and probably even grumble among themselves. Giving your team a formal means to express their thoughts not only empowers them, but it also begins to develop them as your next generation of leaders.

You probably have strong opinions about what your business is doing well and where it needs help, but remember that your viewpoint is affected by your position, your history, and even your ego. A team-driven SWOT analysis will give you a clearer sense of the company, by combining a broad variety of viewpoints. For example, you may think your technology is first-rate, only to discover that your employees crave an upgrade to a more sophisticated system.

The most important benefit of having each employee do a SWOT analysis is that it gives the team a reason to buy into your business strategy. They have had a voice in assessing the company and identifying goals, so they are more likely to take ownership of and responsibility for those goals. They’re also better able to take a wider view, seeing how the work they perform each day contributes to the overall organization’s viability and growth, and they may become a more cohesive and collaborative group in the process.

How to make it happen

There are two important first steps. First, your team must know that you genuinely want candid input and that you’re going to empower them to manage the process. Second, you’ll need to explain the basics of SWOT analysis, so they clearly understand the expectations. It may be beneficial to engage an outside facilitator who can explain the process and guide the team through the steps. Employees may be more comfortable asking tough questions and clarifying instructions when they’re not talking to the boss.

The actual process depends largely on the size and structure of your organization. If you have multiple departments or people serving in similar roles, you may want to create committees to develop joint analyses, and then invite a representative from each committee to hammer out a final draft and secure agreement from all of the team members. Then they can present their analysis and its rationale to you. If you have multiple locations, you can use retreats or teleconferences to bring everyone together.

It’s critical that you step back and avoid trying to influence the process. Resist the urge to peer at employees’ progress or to ask them how things are going. If asked to intervene in a dispute, gracefully inform them that you trust their ability to achieve a resolution and step out of the room.

Regular use of SWOT analyses is a powerful way to guide your planning process and identify areas where improvement or additional resources are needed, as well as where your company may already have opportunities for impact and growth. When the business environment shifts in any way, you can revisit and refresh your analysis. This way, no matter what happens in the economy or the outside world, you’ll be more confident in your ability to respond effectively. n

The author

Rick Dennen is president and chief executive officer of Oak Street Funding, which provides commission-based lending for insurance agents who need capital to buy, build or sell their agency. Dennen is a licensed agent in the state of Indiana for life, accident and health products and a licensed Certified Public Accountant in the state of Indiana. In addition, he holds an MBA in finance and is an instructor of venture capital and entrepreneurial finance at the Indiana University Kelley School of Business. You can reach him via email at


Related Articles






Philadelphia Let's Talk - Click Here

Spread The Word & Share This Page

Trending Tweets