Improved SWOT Approach for Conducting Strategic Planning in the Construction Industry

Abstract

Strength, weakness, opportunity, and threat (SWOT) analysis has been in use since the 1960s as a tool to assist strategic planning in various types of enterprises including those in the construction industry. While still widely used, the approach has called for improvements to make it more helpful in strategic management. The project described in this paper aimed to study whether the process to convert a SWOT analysis into a strategic plan could be assisted with some simple rationally quantitative model, as an augmented SWOT analysis. By using the mathematical approaches including the quantifying techniques, the “maximum subarray” method, and fuzzy mathematics, one or more heuristic rules (HRs) are derived from a SWOT analysis. These HRs bring into focus the most influential factors concerning a strategic planning situation, and thus inform strategic analysts where particular consideration should be given. A case study conducted in collaboration with a Chinese international construction company showed that the new SWOT approach is more helpful to strategic planners. The paper provides an augmented SWOT analysis approach for strategists to conduct strategic planning in the construction industry. It also contributes fresh insights into strategic planning by introducing rationally analytic processes to improve the SWOT analysis.