The Sustainability SWOT Analysis is a tool for strategic sustainability analysis and decision-making that can be used in combination with the Sustainable Business Model Canvas. Whilst the Sustainable Business Model Canvas is based on the classic Business Model Canvas, the Sustainability SWOT analysis is based on the widely used SWOT analysis, and will therefore be easy to learn and use for most professionals. The Sustainability SWOT retains the original classification into two main categories:
Internal factors (the Strengths and Weaknesses internal to the organisation)
External factors (the Opportunities and Threats external to the organisation)
Whilst the original SWOT analysis could indeed be used in a way that includes ecological and sociocultural aspects, thereby following a triple-bottom-line approach, this is not what is usually happening in practice.
The Sustainability SWOT addresses this problem by “wrapping” the classical SWOT into a triple-bottom-line context: it forces users to first identify environmental and social trends and challenges, and then conduct a triple-bottom-line SWOT analysis to prioritize concluded actions. This way, a classical tool with high recognition value but low apparent sustainability relevance has been “upgraded” to incentivise professionals to consider environmental and sociocultural issues and force them to include these issues when considering relevant actions to take.
How to use the Sustainability SWOT analysis
The Sustainability SWOT analysis “canvas” is structured into three main sections, this way incentivising a sequential completion by the user.
Step 1: Environmental and Social Challenges and Big Trends
As a first step, the user starts with a broad assessment of “big” environmental and sociocultural challenges and trends. As part of this first step, the user should ask the questions: what do I and others see changing in the world, and which related challenges do arise? This consideration could e.g. include challenges such as increasing water scarcity, climate change induced temperature extremes, an increase in mental illness related to stress and job insecurity or plastic pollution of the oceans. Part of this consideration are also “big trends”, such as demographic shifts (e.g. an aging population, particularly in Germany or Japan) or shifts related to globalisation (e.g. increasing unemployment due to loss of manufacturing jobs in western nations).
This first step makes sure that external environmental and sociocultural challenges and trends are at least considered when making decisions, and increases the likelihood that they actually affect those decisions. This is important, because the often lamented lack of consideration for externalities by businesses is in part a consequence of a lack of awareness of employees. Awareness-raising therefore can have a significant impact on corporate decision-making, in addition to its educational impact, as it may make any misalignment between a companies proclaimed values and its actions obvious. This awareness of values misalignment can indeed have a profound positive impact, as a recent study showed.
Step 2: SWOT Analysis with a triple-bottom-line focus
Following step one, the classical part of the SWOT analysis can be performed. However, the user is prompted to not only consider the challenges and trends defined in the first section, but also to evaluate Strengths, Opportunities, Weaknesses and Threats with particular regard to environmental and sociocultural aspects, and innovative ways to address them (e.g. via cooperations with value chain partners on supply chain transparency). This way, the Sustainability SWOT analysis can also initiate innovation and business transformation.
Step 3: Prioritisation and Action
In the final part, the user of the Sustainability SWOT Analysis should prioritise gained insights and, in case the exercise is intended to influence senior management in a cooperation, identify strong messages and their links to the company values. Finally, a sensible strategy for taking short-, mid- and long-term action can be derived.
Due to the fact that the Sustainability SWOT Analysis is based on the familiar classical SWOT, it’s implementation into the processes of a traditional company is straightforward. The Sustainability SWOT enables both strategic analysis and decision-making and may initiate innovation, due to its emphasis on identifying potentially disruptive “big trends”. The Sustainability SWOT is useful to work across internal departments as well as with suppliers, customers and other stakeholders to create long-term sustainable business value. In combination with the Sustainable Business Model Canvas and the Impact Canvas, the Sustainability SWOT represents a core-tool for sustainable innovation and management.