▪ Vision

▪ Mission
▪ Objectives

▪ External audit
▪ Internal audit

▪ Past successful strategies

 Stage 1: The Input Stage

Stage 2: The Matching Stage

Stage 3: The Decision Stage

▪ Stage 1: the input stage
▪ Provides basic input information for the matching and decision stage matrices
▪ Requires strategists to quantify subjectivity early in the process.
▪ Good intuitive judgment always needed

▪ IFE: Internal Factor evaluation matrix

▪ EFE: External Factor Evaluation Matrix
▪ CPM: Competitive Profile Matrix (CPM):
▪ Identifies firm’s major competitors and their strengths & weaknesses in relation
to a sample firm’s strategic positions
▪ Critical success factors include internal and external issues
▪ Stage 2: The matching stage
▪ Match between organization’s internal resources and skills and the
opportunities and risks created by its external factors
▪ SWOT Matrix
▪ SPACE Matrix
▪ BCG Matrix
▪ IE Matrix
▪ Grand Strategy Matrix (GS)
▪ Stage 2: The matching stage
▪ SWOT Matrix:
▪ Develop 4 types of strategies
▪ Strengths-Opportunities (SO)
▪ Weaknesses-Opportunities (WO)
▪ Strengths-Threats (ST)
▪ Weaknesses-Threats (WT)
▪ SWOT matrix

Threats Use a firm’s

Opportunities SO
internal
Weaknesses strengths to take
Strategies
Strengths advantage of
external
(SWOT) opportunities
▪ SWOT matrix

Improving
Threats
internal
Opportunities WO weaknesses by
Weaknesses Strategies taking
Strengths advantage of
(SWOT) external
opportunities
▪ SWOT matrix

Threats
Using firm’s
Opportunities ST strengths to
Weaknesses Strategies avoid or reduce
Strengths the impact of
(SWOT) external threats
▪ SWOT matrix

Defensive tactics
Threats aimed at
Opportunities WT
reducing
Weaknesses internal
Strategies
Strengths weaknesses and
avoiding
(SWOT) environmental
threats
 Key Internal Factor Key External Factor Resultant Strategy

20% annual growth in the cell

Excess working capacity
+ phone industry (opportunity) = Acquire Cellfone, Inc.
(strength)
Fivimart

Pursue horizontal integration by

Exit of two major foreign
Insufficient capacity buying competitor's facilities
+ competitors form the industry =
(weakness) Metro;
(opportunity)
Ocean mart

Decreasing numbers of young Develop new products for older

Strong R&D (strength) + =
adults (threat) adults

Poor employee morale Develop a new employee

+ Strong union activity (threat) =
(weakness) benefits package
▪ Step in developing the SWOT matrix
1. List the firm’s key external opportunities
2. List the firm’s key external threats
3. List the firm’s key internal strengths
4. List the firm’s key internal weaknesses
5. Match internal strengths with external opportunities and record the resultant SO
Strategies.
6. Match internal weaknesses with external opportunities and record the resultant WO
Strategies
7. Match internal strengths with external threats and record the resultant ST Strategies
8. Match internal weaknesses with external threats and record the resultant WT Strategies
 Leave Blank Strengths-S Weaknesses-W

List Strengths List Weaknesses

Opportunities- SO Strategies WO Strategies

O
Use strengths to take Overcome weaknesses
List Opportunities advantage of opportunities by taking advantage of
opportunities

Threats-T ST Strategies WT Strategies

List Threats Use strengths to avoid Minimize weaknesses

threats and avoid threats
▪ Stage 2: The matching stage
▪ SPACE Matrix (Strategic Position and Action Evaluation Matrix)
Four quadrants framework determine appropriate strategies
▪ Aggressive:
▪ Conservative:
▪ Defensive:
▪ Competitive:
▪ Stage 2: The matching stage
▪ SPACE Matrix (Strategic Position and Action Evaluation Matrix)
Depending on the type of organization, numerous variables could make up each of
the dimensions represented on the axes of the SPACE matrix. Variables that were
included in the firm’s EFE and IFE matrices should be considered in developing a
SPACE matrix.
 FP
Conservative +7 Aggressive
+6
- Market penetration +5 - Integration
- Market development +4 - Market penetration
- Product development - Market development
- Related diversification +3 - Product development
+2 - Diversification
+1
CP IP
-7 -6 -5 -4 -3 -2 -1 -1 +1 +2 +3 +4 +5 +6 +7

-2
- Retrenchment - Integration
- Divestiture -3 - Market penetration
- Liquidation - Market development
-4 - Product development
-5
Defensive -6 Competitive
-7
SP
▪ Stage 2: The matching stage
▪ SPACE Matrix
Internal Strategic Position External Strategic Position

Financial Position (FP) Stability Position (SP)

Inventory turnover : Technological changes
Earning per shares (EPS) Rate of inflation*
Price Earning ratio Demand variability*
Return on investment Price range of competing products
Leverage Barriers to entry
Liquidity Competitive pressure
Working capital Price elasticity of demand
Cash flow Ease of exit from market
Risk involved in business
▪ Stage 2: The matching stage
▪ SPACE Matrix
Internal Strategic Position External Strategic Position

Competitive Position (CP) Industry Position (IP)

Market share Growth potential
Product quality Profit potential
Product life cycle Financial stability
Customer loyalty Technological know-how
Competition’s capacity utilization Resource utilization
Technological know-how Capital intensify
Control over suppliers & Ease of entry into market
distributors Productivity, capacity utilization
▪ SPACE Matrix.
Step in developing the SPACE matrix
1. Select a set of variables to define FP, CP, SP, and IP.
2. Assign a numerical value:
1. From +1 to +7 to each FP & IP dimension
2. From -1 to -7 to each SP & CP dimension
3. Compute an average score for each FP, CP, SP, and IP.
4. Plot the average score on the appropriate axis.
5. Add the two scores on the x-axis and plot the point. Add the two scores on
the y-axis and plot the point. Plot the intersection of the new xy point.
6. Draw a directional vector from the origin through the new intersection point.
This vector reveals the type of strategies recommended for the organization.
Vị thế tài chính (FP) Điểm
Tỷ lệ vốn ban đầu của ngân hàng là 7.23% (yêu cầu chung là 6%) 1

Lơị nhuận trên tài sản của ngân hang là -0,77 (trung bình ngành 0.7) 1

Lợi nhuận ròng là 183 triệu $, giảm 9% so với năm trước 3

Doanh thu ngân hang tăng 7% đạt 3,46 tỷ 4

FP Trung bình:
Vị thế ngành (IP) Điểm
Bãi bỏ quy định về cung cấp địa lý và sản phẩm tự do 4

Bãi bỏ quy định làm tăng cạnh tranh trong NH 2

Luật ngân hàng liên bang cho phép thâu tóm ngân hàng ở bang khác 4
Vị thế bền vững (SP) Điểm
Các nước kém phát triển đang trải qua lạm phat cao và bất ổn chính -4
trị
NH có trụ sở tại Pittsburg phụ thuộc vào ngành dầu mỏ, thép và các -5
ngành này đang đình trệ

Bài bỏ quy định ngân hàng tạo ra sự bất ổn toàn ngành -4

SP Trung bình:
Vị thế cạnh tranh (CP) Điểm
Cung cấp dịch vụ cho hơn450 tổ chức tại 38 bang -2

các ngân hàng siêu vùng, quốc tế ngày càng gi tăng cạnh tranh -5

Ngân hàng có khách hàng lớn -2

CP trung bình
 FP
Conservative +7 Aggressive
+6
+5
+4
+3
+2
+1
CP IP
-7 -6 -5 -4 -3 -2 -1 -1 +1 +2 +3 +4 +5 +6 +7

-2
-3

-4
-5
Defensive -6
-7 Competitive
SP
▪ Stage 2: The matching stage
▪ BCG Matrix (Boston Consulting Group Matrix)
▪ Enhances multidivisional firms’ efforts to formulate strategies /
▪ Autonomous divisions (or profit centers) constitute the business portfolio SBU
▪ Firm’s divisions may compete in different industries requiring separate strategy
▪ SBU:
▪ Stage 2: The matching stage
▪ BCG Matrix (Boston Consulting Group Matrix)
▪ Graphically portrays differences among divisions
▪ Focuses on market share position and industry growth rate
▪ Manage business portfolio through relative market share position (RMS) and
industry growth rate
▪ Relative market share (RMS) position defined:
▪ Ratio of a divisions own market share in a particular industry to the market share
held by the largest rival firm in that industry.
 Relative Market Share Position
High Medium Low
1.0 .50 0.0

High
+20
Industry Growth Rate

Stars Question Marks

II I
Medium
0

Cash Cows Dogs

III IV
Low
-20
Question Marks
• Low relative market share position yet
compete in high-growth industry.
▪ Cash needs are high
▪ Cash generation is low

• Decision to strengthen (intensive strategies) or

divest
Stars
• High relative market share and high industry
growth rate.
▪ Best long-run opportunities for growth and
profitability

• Substantial investment to maintain or

strengthen dominant position
▪ Integration strategies, intensive strategies,
joint ventures
Cash Cows: Vinamilk : 50%
• High relative market share position, but
compete in low-growth industry
▪ Generate cash in excess of their needs
▪ Milked for other purposes
• Maintain strong position as long as possible
▪ Product development, concentric
diversification
▪ If becomes weak—retrenchment or
divestiture
Dogs

• Low relative market share position and

compete in slow or no market growth
▪ Weak internal and external position

• Decision to liquidate, divest, retrenchment

▪ Stage 2: The matching stage
▪ Grand Strategy Matrix
▪ Popular tool for formulating alternative strategies
▪ All organizations (or divisions) can be positioned in one of four quadrants

▪ Based on two evaluative dimensions:

▪ Competitive position
▪ Market growth
 RAPID MARKET GROWTH
Quadrant II Quadrant I
1. Market development 1. Market development
2. Market penetration 2. Market penetration
3. Product development 3. Product development
4. Horizontal integration 4. Forward integration
5. Divestiture 5. Backward integration
6. Liquidation 6. Horizontal integration
7. Concentric diversification
WEAK STRONG
COMPETITIVE COMPETITIVE
POSITION Quadrant III Quadrant IV
POSITION
1. Retrenchment 1. Concentric diversification
2. Concentric diversification 2. Horizontal diversification
3. Horizontal diversification 3. Conglomerate
4. Conglomerate diversification
diversification 4. Joint ventures
5. Liquidation

SLOW MARKET GROWTH

▪ Stage 2: The matching stage
▪ Grand Strategy Matrix
Tool for formulating alternative strategies
Based on two dimensions
- Competitive position
- Market growth
 RAPID MARKET GROWTH
Quadrant II Quadrant I
1. Market development 1. Market development
2. Market penetration 2. Market penetration
3. Product development 3. Product development
4. Horizontal integration 4. Forward integration
5. Divestiture 5. Backward integration
6. Liquidation 6. Horizontal integration
WEAK 7. Related diversification
STRONG
COMPETITIVE COMPETITIVE
POSITION Quadrant III Quadrant IV
POSITION
1. Retrenchment 1. Related diversification
2. Related diversification 2. Unrelated diversification
3. Unrelated diversification 3. Joint ventures
4. Divestiture
5. Liquidation

SLOW MARKET GROWTH

Ch 6 -39
▪ Stage 2: The matching stage
▪ Grand Strategy Matrix
Quadrant I
• Excellent strategic position
• Concentration on current markets and products
• Take risks aggressively when necessary
Quadrant II
• Evaluate present approach seriously
• How to change to improve competitiveness
• Rapid market growth requires intensive strategy
▪ Stage 2: The matching stage
▪ Grand Strategy Matrix
Quadrant III
• Compete in slow-growth industries
• Weak competitive position
• Drastic changes quickly
• Cost and asset reduction indicated (retrenchment)
Quadrant IV
• Strong competitive position
• Slow-growth industry
• Diversification indicated to more promising growth areas
▪ Stage 3: The decision stage
▪ Quantitative Strategic Planning Matrix (QSPM)
▪ Only technique designed to determine the relative attractiveness of feasible
alternative actions
▪ Tool for objective evaluation of alternative strategies
▪ Based on identified external and internal crucial
success factors
▪ Requires good intuitive judgment
▪ Stage 3: The decision stage
▪ QSPM Matrix
- Developing QSPM matrix

1. List the firm’s key external opportunities & threats; list the firm’s
key internal strengths and weaknesses
2. Assign weights to each external and internal critical success
factor
3. Examine the Stage 2 (matching) matrices and identify alternative
strategies that the organization should consider implementing
4. Determine the Attractiveness Scores (AS)
5. Compute the total Attractiveness Scores (TaS)
6. Compute the Sum Total Attractiveness Score (StTAS)
 Strategic Alternatives
Key External Factors Weight Strategy 1 Strategy 2 Strategy 3
Economy
Political/Legal/Governmental
Social/Cultural/Demographic/
Environmental
Technological
Competitive

Key Internal Factors

Management
Marketing
Finance/Accounting
Production/Operations
Research and Development
Computer Information
Systems
 Thâm nhập Mở rộng Phát triển
Trọng số thị trường thị trường sản phẩm
Các yếu tố bên trong AS TAS AS TAS AS TAS
Quản trị cấp cao có 40 năm kinh nghiệm 0.05 3 0.15 3 0.15 3 0.15
Thương hiệu A'one khá nổi tiếng 0.2 4 0.8 4 0.8 3 0.6
Chất lượng sản phẩm top đầu 0.1 4 0.4 4 0.4 3 0.3
Công nghệ sản xuất thuộc top đầu ngành 0.03 3 0.09 3 0.09 4 0.12
Tiềm lực tài chính mạnh 0.1 2 0.2 3 0.3 3 0.3
Đội ngũ lao động lành nghề 0.05 2 0.1 3 0.15 3 0.15
Hệ thống phân phối rông khắp Việt Nam 0.2 4 0.8 4 0.8 3 0.6
Giá thành Sản phẩm tương đối cao 0.12 1 0.12 1 0.12 2 0.24
xuất khẩu SP từ Việt Nam còn ít 0.03 1 0.03 2 0.06 2 0.06
Hoạt động R&D chưa mạnh 0.12 2 0.24 1 0.12 2 0.24
1 2.93 2.99 2.76

Các yếu tố bên ngoài

GDP, GDP Việt Nam tăng trưởng nhanh 0.1 3 0.3 3 0.3 3 0.3
Việt Nam hoàn thành AFTA 0.02 2 0.04 2 0.04 2 0.04
Việt Nam hoàn thành EVFTA 0.03 2 0.06 2 0.06 3 0.09
Lãi suất Việt Nam giảm dần 0.2 3 0.6 3 0.6 4 0.8

Tại Việt Nam đã sản xuất được tinh bột sắn 0.2 2 0.4 3 0.6 4 0.8

Vedan và Ajinomoto mở rộng sản xuất ở VN 0.3 2 0.6 2 0.6 1 0.3

Giá xăng dầu ổn định và ở mức cao 0.15 2 0.3 1 0.15 1 0.15
1 2.3 2.35 2.48
5.23 5.34 5.24
▪ QSMP matrix
Positives:

▪ Sets of strategies examined simultaneously or sequentially

▪ Requires the integration of pertinent external and internal
factors in the decision-making process
Limitations:
▪ Requires intuitive judgments and educated assumptions
▪ Only as good as the prerequisite inputs