TOWS Matrix
The TOWS Matrix is a tool that helps businesses to identify strengths, weaknesses, opportunities, and threats. It builds on SWOT but focuses more on how these elements can interact to create strategies.
Key concepts:
SO (Strengths-Opportunities): Use strengths to maximise opportunities
ST (Strengths-Threats): Use strengths to minimise threats
WO (Weaknesses-Opportunities): Use opportunities to improve weaknesses
WT (Weaknesses-Threats): Minimise weaknesses to avoid threats
The results
- A view of strengths, weaknesses, opportunities and threats
- Strategies to take advantage of the strengths and opportunities, and mitigate the weaknesses and threats
When to use it
Strategy Formulation: When evaluating or making strategic decisions
New Product Development: When creating new products or services
Strategic Initiatives: When undertaking initiatives that are most important to bring the organisational strategy to life
Strengths
Simple
Versatile
Both internal and external focus
Action focused
Weaknesses
Can be overly simplistic
Can lead to narrow thinking
Limited focus on trade-offs when prioritising
How to use it?
What do I need to start?
Information relevant to the organisation or industry. For example:
- Internal insights: Sales figures, financial statements, and performance metrics
- External insights: Reports on market trends, industry analysis, and competitive landscape
- Stakeholder feedback: Input from customers, employees, suppliers, and partners
How to use it?
Who to involve?
TOWS can be done alone, or as part of a team. Consider including:
- Individuals who bring a strategic perspective
- People who know the specific strengths and weaknesses of their part in the organisation
- People who can provide a fresh perspective to evaluate threats and weaknesses
Step by step
1
Define the objective
Define the objective of completing the TOWS analysis.
3
Focus in
After completing the SWOT analysis, prioritise the most critical aspects. Ask questions like:
- What strengths best align with the organisation’s strategic goals?
- What strengths could provide a unique competitive advantage?
- What weaknesses are most crucial to address?
- What threats have the highest likelihood and potential impact?
Highlight the aspects that seem most important.
4
Analyse interactions
Analyse how internal strengths and weaknesses interact with external opportunities and threats. This helps in crafting targeted initiatives.
Strength-Opportunity (S/O) Interaction : Leverage the organisation’s strengths to capitalise on opportunities. Ask questions like:
- “How can the organisation’s strengths be used to exploit these opportunities effectively?”
Weakness-Opportunity (W/O) Interaction : Address internal weaknesses by taking advantage of external opportunities. Ask questions like:
- “How can opportunities be used to improve or compensate for existing weaknesses?”
Strength-Threat (S/T) Interaction : Use strengths to defend against external threats. Ask questions like:
- “How can the organisation use its strengths to mitigate or neutralise potential threats?”
Weakness-Threat (W/T) Interaction : Develop plans to minimise weaknesses and protect against threats. Ask questions like:
- “How can the organisation work on its weaknesses to better prepare for external threats?”
5
Evaluate and prioritise
Assess each initiative. Consider factors like:
Feasibility: Evaluate if the organisation has the necessary resources and skills to implement identified initiatives. If not, consider if the organisation is prepared to invest
Impact: Evaluate the potential short-term and long-term effects or benefits of each initiative
Vision Alignment: Assess if each initiative aligns with the organisation’s overall vision and objectives.
Rank initiatives.
6
Plan initiatives
- Create an actionable plan for the top-priority initiatives. Consider using Road Mapping to visualise and communicate the plan.
- Define initiative owners, necessary resources, and timelines. Consider using Project Initiation Documents (PIDs) or 1-Page Business Cases for detailed planning.