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How To Do A SWOT Analysis In Healthcare
Learn the four steps of SWOT analysis in healthcare and the five rules to live by during this process, with a bonus section of common examples.
While there is some debate, most people agree that SWOT analysis originated from a Stanford University research project in the 1960s-70s. Using data from top companies, the project tried to figure out why corporate planning fails. The original term, “SOFT analysis,” eventually morphed into present-day SWOT, which is an acronym for strengths, weaknesses, opportunities, and threats. (If you need a refresher on SWOT itself before we dive into using it for healthcare, check out our in-depth article on the subject.)
SWOT analysis helps organizations in a variety of industries analyze their businesses and has been adopted by hospitals due to its effective and straightforward methods. In this article, we’ll explain how to do a SWOT analysis in healthcare and provide a few common examples to help you get started.
The Four Steps Of SWOT Analysis In Healthcare
Step 1: Pull together key data.
To be a well-run, high-performing hospital, you must be data driven. The first step of SWOT analysis in healthcare is to collect and assess important data. This can range from patient health records and disease registries to claims statuses and funding sources. You don’t need to use every byte of data you have—focus on key metrics that relate to your strategy. Once you’ve gathered the information, double check that it’s accurate and begin to identify your organization’s capabilities. In this situation, remember that data can be more helpful than gut reactions. Do we have a slow emergency room, or is it similar to others in the state? If your hospital reports regularly on progress, this step is really easy.
Do you track and measure the right data? Browse this library of 108 healthcare metrics...you may find a few that should be part of your SWOT.
Step 2: Do your SWOT analysis.
The second step is to take the data you collected in step one and organize it into the four SWOT categories: strengths, weaknesses, opportunities and threats. If you have trouble segregating the information, remember that your strengths and weaknesses are internal factors, while opportunities and threats are the result of external, uncontrollable factors.
Of course a SWOT is not entirely data driven, but data can be helpful in thinking about what you’re good at and what areas need improvement. Some organizations look at their SWOT categories using Balanced Scorecard Perspectives. What are our financial strengths and weaknesses? Are there any opportunities afforded to us as a result of our strong financial position (such as mergers)? This is a quick example, but you get the idea.
This is a critical step! In the next section, we outline some rules to follow when you’re doing your SWOT. Here are some ideas for gaining that competitive advantage for your healthcare organization when you're doing your SWOT analysis.
Step 3: Develop SWOT matrices. (Optional)
Next, develop a four-box SWOT matrix for each business unit. This may not be necessary if you have a smaller organization, which is why it’s optional. The goal here is to tailor SWOTs to specific departments or teams, so you can get a multifaceted picture of your capabilities instead of having to make generalizations that span the company.
Step 4: Perform analysis and make decisions.
At this point, you’ll take what you’ve learned in the previous three steps and start your analysis. The insights you gain from categorizing data into the SWOT categories and consolidating it in a box matrix will inform your strategic planning and influence your biggest decisions. If you decide that you’re weak in a particular area, what should you do about it? Should you exit that business or invest to improve it?
5 Rules To Live By When Doing SWOT Analysis
When you’re looking at the pile of data you gathered in the very first step of SWOT analysis in healthcare, it can be easy to lose sight of the overall framework. When you’re in the midst of step two, keep these rules in mind:
- Be specific. Your SWOT will drive all strategic decisions, so avoid vague or unclear statements. For example, saying your hospital’s strength is fundraising is too ambiguous. But if you were to say your strength was fundraising $10 million annually, primarily through major gifts, the specificity makes it easier to form strategy around.
- Be objective. Get feedback from other stakeholders and subject matter experts. These could be outside consultants, cross-functional support staff, or even internal research team members. Their input will help provide accuracy and objectivity.
- Be realistic. Especially as you evaluate your internal strengths and weaknesses, be realistic and set aside any biases based on your personal experience or knowledge. The output of this SWOT analysis will help drive your organization forward, so don’t include information that won’t be useful or is outside your scope of capabilities.
- Apply context. Differentiate between your organization’s current state and where you want to be in the future. Focus your strengths and weaknesses on where you are now, and opportunities and threats on where you can be.
- Keep it simple. Avoid overanalysis or unnecessary complexity—that just makes it harder to analyze the information. Create straightforward, simple SWOT statements that will neatly plug into your matrix.
SWOT Analysis Examples In Healthcare
Below are common examples of strengths, weakness, opportunities, and threats a hospital might have. These provide a general guide to help you get started with your own SWOT analysis. We have added examples in parentheses of how you might leverage some of your data to identify areas in your SWOT.
- A primary focus on quality improvement ($ saved from quality projects)
- Internal teams dedicated to research and analytics ($ spent on research)
- High-quality medical personnel (# of staff with external recognition)
- Modern medical equipment and a well-equipped facility (average age of medical equipment)
- Outdated healthcare facilities and technology
- Insufficient management training
- Lack of funding and resources to support programs
- Poor location that’s not easily accessible for staff and patients
- High staff turnover
- Collaborate with different healthcare organizations to knowledge share
- Develop healthcare programs and initiatives to drive more community outreach and engagement
- Increase funding for analytics and researching, including both staff and technology
- Create mentor programs
- Economic or political insecurity
- Policy and legislation changes that result in budget deficits
- Pressure to reduce costs while meeting expectations of universal healthcare coverage
- Increased competition from newly built hospitals
Your SWOT is just the start.
After you’ve done your SWOT analysis, you’ll know where you’re leading and where you’re lagging. Your next move is to plug this information into a strategy map. ClearPoint can help you align your SWOT with your strategy and track everything, so you can improve performance and achieve your goals.
Contact us to learn more about what comes after the SWOT analysis for healthcare organizations.