Understanding TOWS Analysis: A Comprehensive Guide to Strategic Planning

TOWS Analysis is a strategic planning tool that helps organisations identify and evaluate potential strategies. It stands for Threats, Opportunities, Weaknesses, and Strengths. The tool is an extension of the SWOT analysis, which only looks at an organisation’s strengths, weaknesses, opportunities, and threats. TOWS analysis is a more comprehensive approach that considers external threats and opportunities along with internal weaknesses and strengths.

How TOWS Analysis Works

TOWS Analysis involves four steps:

1. Identify the organisation’s internal strengths and weaknesses
2. Identify the external opportunities and threats
3. Combine the internal and external factors to create four sets of strategies (Strengths-Opportunities, Strengths-Threats, Weaknesses-Opportunities, and Weaknesses-Threats)
4. Evaluate and select the best strategy based on the organisation’s goals and objectives.

Benefits of TOWS Analysis

TOWS Analysis has several benefits, including:

1. Helps organisations develop a more comprehensive understanding of their internal and external environment.
2. Provides a structured approach to strategic planning that can help organisations prioritise and evaluate potential strategies.
3. Helps organisations identify and address weaknesses that may be hindering their success.
4. Provides a framework for identifying and capitalising on opportunities that may help an organisation grow and succeed.
5. Helps organisations evaluate potential threats and develop strategies to mitigate them.

TOWS Analysis Example

An example of TOWS Analysis in action might look like this:

Strengths

• Strong brand reputation
• High-quality products
• Efficient manufacturing process

Weaknesses

• Limited market reach
• High production costs
• Limited product range

Opportunities

• Emerging markets
• Growing demand for sustainable products
• Partnership opportunities with suppliers

Threats

• Economic instability
• Increasing competition
• Changing consumer preferences

Based on this analysis, the following strategies could be considered:

Strengths-Opportunities:

• Expand into emerging markets to capitalise on growing demand for sustainable products.
• Form partnerships with suppliers to reduce production costs and increase product range.

Strengths-Threats:

• Increase marketing efforts to maintain market share and fend off competition.
• Improve efficiency and reduce costs to mitigate the impact of economic instability.

Weaknesses-Opportunities:

• Expand product range to capitalise on emerging markets.
• Invest in sustainable production methods to capitalise on growing demand for sustainable products.

Weaknesses-Threats:

• Develop new products to fend off competition and expand market reach.
• Reduce production costs to mitigate the impact of economic instability.

TOWS Analysis can help organisations identify and evaluate potential strategies based on their internal and external environment. By using this tool, organisations can develop a more comprehensive understanding of their strengths, weaknesses, opportunities, and threats, and prioritise and evaluate potential strategies. If you’re looking to improve your strategic planning, TOWS Analysis is a tool that you should consider.

The difference between a SWOT analysis and a TOWS analysis

SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis and TOWS (Threats, Opportunities, Weaknesses, and Strengths) analysis are two tools that are commonly used in strategic planning. While they have some similarities, there are also some significant differences between the two.

The main difference between SWOT and TOWS analysis is the order in which the internal and external factors are considered. In a SWOT analysis, an organisation begins by analysing its internal strengths and weaknesses before examining external opportunities and threats. This approach is sometimes referred to as an “inside-out” perspective.

In contrast, TOWS analysis takes an “outside-in” perspective. It starts by looking at the external environment, including potential threats and opportunities, before considering the organisation’s internal strengths and weaknesses.

Another key difference between SWOT and TOWS analysis is the level of detail that is considered. SWOT analysis is often more general and high-level, while TOWS analysis is more detailed and specific. For example, in a SWOT analysis, an organisation might identify “high production costs” as a weakness. In a TOWS analysis, the organisation would delve deeper into the issue and consider potential strategies for reducing those costs.

TOWS analysis also tends to be more action-oriented than SWOT analysis. The four sets of strategies that are generated through TOWS analysis are designed to help an organisation take action to address internal weaknesses and external threats, while also taking advantage of internal strengths and external opportunities.

In conclusion, while both SWOT and TOWS analysis are valuable tools for strategic planning, the main differences between the two lie in the order in which internal and external factors are considered, the level of detail analysed, and the action-oriented approach of TOWS analysis. Ultimately, the choice between SWOT and TOWS analysis will depend on the needs and goals of the organisation.

Implementing a TOWS analysis

Implementing a TOWS analysis involves a systematic approach that takes into account both internal and external factors to generate strategies for an organisation. Here are the steps to follow to implement a TOWS analysis:

1. Identify the internal strengths and weaknesses of the organisation: The first step is to look at the organisation’s internal environment and identify the strengths and weaknesses. This could involve reviewing the organisation’s operations, products, services, and other internal factors that contribute to its success or hinder its growth.
2. Identify external opportunities and threats: The next step is to look at the external environment and identify opportunities and threats that could impact the organisation. This could include changes in the industry, shifts in consumer behaviour, new technology, or emerging competitors.
3. Combine internal and external factors: Once the internal and external factors have been identified, the next step is to combine them to create a TOWS matrix. The matrix will help to identify the four sets of strategies that can be developed to address the issues at hand.
4. Develop strategies: Using the TOWS matrix, develop strategies for the organisation that leverage its strengths and opportunities while mitigating its weaknesses and threats. The four sets of strategies are:

• SO (Strengths-Opportunities): Strategies that build on the organisation’s strengths to take advantage of external opportunities.
• ST (Strengths-Threats): Strategies that leverage the organisation’s strengths to address external threats.
• WO (Weaknesses-Opportunities): Strategies that address internal weaknesses to take advantage of external opportunities.
• WT (Weaknesses-Threats): Strategies that mitigate internal weaknesses and external threats.

5. Evaluate and prioritise strategies: After developing the strategies, evaluate each one based on its feasibility, potential impact, and alignment with the organisation’s goals and objectives. Prioritise the strategies based on their importance and develop an action plan to implement them.
6. Monitor and adjust: Finally, regularly monitor the progress of the strategies and adjust them as necessary to ensure they remain relevant and effective.

In conclusion, implementing a TOWS analysis involves a systematic approach that considers both internal and external factors and generates strategies to address issues and leverage opportunities. By following these steps, an organisation can create a plan that is action-oriented and helps achieve its goals and objectives.