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The TOWS Matrix

Developing Strategic Options by Performing an External-Internal Analysis

The TOWS Matrix - Developing Strategic Options by Performing an External-Internal Analysis

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JensHN

USE a TOWS matrix to take advantage of your external opportunities and minimize threats.

TOWS Analysis is an extension of the classic analytics tool, SWOT Analysis.

TOWS and SWOT are acronyms for different arrangements of the words: Strengths, Weaknesses, Opportunities and Threats. But, while SWOT tends to focus on brainstorming all points that fall under these four headings, TOWS takes it to the next step.

You can use both tools in combination to assess and refine your organizational or departmental strategy. You can also use them to think about a process, a marketing campaign, or even your own career.

In this article, we look at the differences between SWOT and TOWS, and how you can use both to assess, refine and improve your current strategy.

What is a TOWS Analysis?

A TOWS analysis is very similar to SWOT, however there is a key difference between the two, other than a reshuffling of a few letters!

While SWOT analysis, puts the emphasis on the internal environment (your strengths and weaknesses), TOWS forces you to look at your external environment first (your threats and opportunities).

Doing this allows you to gain better understanding of the strategic choices that you face. (Remember that "strategy" is the art of determining how you'll "win" in business and life.) It helps you ask, and answer, the following questions:

  • How can we make the most of our strengths?
  • How do we circumvent our weaknesses?
  • How can we capitalize on external opportunities?
  • How should we best manage threats?

Once you've answered these questions, the next step is to match external opportunities and threats with your internal strengths and weaknesses, as illustrated in the matrix below:

TOWS Strategic Alternatives Matrix

 

  External Opportunities (O) External Threats (T)
Internal Strengths (S)

SO

"Maxi-Maxi Strategy"

Strategies that use strengths to maximize opportunities.

ST

"Maxi-Mini Strategy"

Strategies that use strengths to minimize threats.
Internal Weaknesses (W)

WO

"Mini-Maxi Strategy"

Strategies that minimize weaknesses by taking advantage of opportunities.

WT

"Mini-Mini Strategy"

Strategies that minimize weaknesses and avoid threats.

TOWS Matrix © 1982 Heinz Weihrich, Ph.D.

How to Use a TOWS Matrix

Step 1: Do a SWOT Analysis

Print off our free SWOT Worksheet and perform a TOWS/SWOT analysis, recording your findings in the space provided. This will help you to understand what your strengths and weaknesses are, as well as identifying the opportunities and threats that you should be looking at.

Step 2: Translate Your Findings Using a TOWS Matrix

Print off our free TOWS Strategic Options Worksheet, and copy the key conclusions from your SWOT Worksheet into the area provided (shaded in blue).

Step 3: Link and Assess Your Strategic Options

For each combination of internal and external environmental factors, consider how you can use them to create good strategic options:

  • Strengths and Opportunities (SO) – How can you use your strengths to take advantage of these opportunities?
  • Strengths and Threats (ST) – how can you take advantage of your strengths to avoid real and potential threats?
  • Weaknesses and Opportunities (WO) – how can you use your opportunities to overcome the weaknesses you are experiencing?
  • Weaknesses and Threats (WT) – how can you minimize your weaknesses and avoid threats?

The options you identify are your strategic alternatives, and these can be listed in the appropriate quadrant of the TOWS worksheet.

Note:

The WT quadrant – weaknesses and threats – is concerned with defensive strategies. Put these into place to protect yourself from loss, however don't rely on them to create success.

Tip:

When you have many factors to consider, it may be helpful to construct a matrix to match individual strengths and weaknesses to the individual opportunities and threats you've identified. To do this, you can construct a matrix such as the one below for each quadrant (SO, ST, WO, and WT).

SO Matrix S1 S2 S3 S4
O1        
O2        
O3        
O4        

This helps you to carry out a detailed analysis of the options that hold the greatest promise. Note any new alternatives you identify on the TOWS Strategic Alternatives worksheet.

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Step 4: Evaluate Your Strategic Options

Evaluate the options you've generated, and identify the ones that will have the greatest benefit, and that best achieve the mission and vision of your organization. Add these to the other strategic options that you're considering.

Key Points

The TOWS Matrix is a relatively simple tool for generating strategic options. It stands for:

  • Threats.
  • Opportunities.
  • Weaknesses.
  • Strengths.

It's a variation of SWOT analysis, but differs because SWOT focuses on internal factors (strengths and opportunities), while TOWS focuses on external factors (threats and opportunities).

By using it, you can look intelligently at how you can best take advantage of the opportunities open to you, and minimize any weaknesses that might result in threats. It can also help you to consider how to use the external environment to your strategic advantage and identify some of the strategic options available to you.

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Comments (9)
  • Over a month ago Yolande wrote
    Thanks for sharing your insights with us, Seo. I think there is a possibility of converting weaknesses to strengths. For instance, if marketing is your weakness, it may become a strength if you get the right marketing partner on-board and re-design your social media strategy.
    Converting threats to opportunity is also possible. A new competitor store opening may be a threat, but could become an opportunity if they bring more feet to the mall and you also have the opportunity to market & sell to those customers.
    However, you may not be able to convert all weaknesses to strengths and all threats to opportunities.

    Yolandé
    Mind Tools Team
  • Over a month ago Seo wrote
    Hi
    As mentioned in TOWS strategic Matrix, is there a possibility of OS, TS, OW, OT as
    1. There can be a scenario where there are many opportunities in the market to be exploited to strengthen my company or to maximize my strengths.
    2. On similar lines, we do face many threats to which my strengths will take its course as a counter force in order to minimize them(threats).
    3. OW stands for when there are many opportunities in the market and how we exploit them in order to minimize the company's weaknesses.
    4. OT calls for many opportunities in the market for which we try to maximize them or use to the core in order to minimize threats.
    Also, is there a possibility of converting weaknesses to strengths and threats to opportunities?
    Waiting for your reply.
  • Over a month ago Michele wrote
    Hi Naveed,

    You are most welcome and we are glad that the article helped you in your assignment. Used alongside SWOT, the TOWS analysis provides and outside-in view of your organization.

    Thanks for the feedback!

    Michele
    Mind Tools Team
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