Business analysts are familiar with the SWOT Analysis that helps businesses get a full perspective of where they stand. The SWOT system looks at the strengths and weaknesses of a business, and the opportunities and threats that business faces to determine what they need to do to improve their business.

While this form of analysis has worked for many businesses, a new way of looking at things was developed with the TOWS Matrix.

What Is the TOWS Matrix?

You'll notice that TOWS is SWOT backward. There's a key reason for this. It's because this analysis looks at things in the opposite order of the SWOT Analysis. Instead of determining the strengths and weaknesses of your business first, you look at the opportunities and threats, the external factors, first.

Once you know what external factors are affecting your business, then you look at the internal factors of strengths and weaknesses and how your business can make changes that will balance internal and external dilemmas. It's mainly used in marketing and business administration.

Why Look at the External Factors First?

The environment (where your business is located, the state of the economy, etc.) can have a big effect, positively or negatively, on your business and on your employees. By getting a clearer picture of external factors surrounding your business, including environment, you can better navigate the internal strengths and weaknesses of your business. You might not realize how many external factors can affect your business.

A clearer picture of the environment, both the threats and the opportunities, will allow your business a better look at those internal strengths and weaknesses. As well, each of these four categories will be looked at together to break the analysis up more. They help you develop a clearer decision on how to manage, market, and grow your business.

Using the TOWS Matrix

Use the analytics to get a clearer overall business picture. Break down the structure of a specific business department. Or find out which of your employees is ready for a raise or more training. These are some of the things that the TOWS Matrix is best used for. So here's how to do it.

1. Look at the External Environment

​​​​You need to determine the external threats and opportunities. List these things. If you're looking for an employee, you may factor in their home and family life, where they live, their continued learning efforts. You may find that an employee is less effective because they have too many irons in the fire, or you may find that someone with a big family is an even harder worker.

2. Determine Internal Weaknesses and Strengths

If you're analyzing an employee, you may look at things like timeliness, willingness to learn, and other such factors when it comes to strengths and weaknesses.

3. Compare the External and Internal Findings

This portion is the part of the TOWS Matrix that differentiates it from that of the SWOT Analysis. In this model, you will look at the opposing analytics of Strengths-Opportunities, Weaknesses-Opportunities, Strengths-Threats, and Weaknesses-Threats. These comparisons help identify the strategies that will help you get the outcome you're hoping for.

  • Comparing Strengths – Comparing the strengths and opportunities allows you to see how strengths benefit from external opportunities. Then comparing those strengths with the threats coming from external factors will allow you to figure out how to lessen those threats – or avoid threats altogether.
  • Comparing Weaknesses – External opportunities can help you overcome internal weaknesses, whether it's a business weakness or an employee weakness. The same concept works for learning what external threats may cause weakness and learn to avoid those threats.

4. Make a Plan

Once you've evaluated these four findings, in these three steps, you can make a plan to change your business, or work with the employee(s) you analyzed. Some things that may be dealt with through this system include determining which employees are growing with your company and which ones may be holding you back. You may use TOWS to determine your competition for a certain business plan or department as well.

Create a Better Business with TOWS Matrix

When you need to develop your business or employees, you need a system that helps you look at the most important aspects of your business. The TOWS Matrix gives you that. It's a way of brainstorming that helps you create a better business by looking deep into your resources and determining which ones have a positive impact and which are negative.

TOWS is good for your image. It's a device that can be used for all types of businesses. And by looking at both internal and external forces at play in your business, you can be assured that it covers all the bases.

Keyword- TOWS Matrix

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