Strategy Analysis / SPACE Matrix Flashcards
Use a firm’s internal strengths to take advantage of external opportunities
SO Strategies
Aim at improving internal weakness by taking advantage of external opportunities
WO Strategies
Use a firm’s strengths to avoid or reduce the impact of external threats
ST Strategies
Defensive tactics directed at reducing internal weaknesses & avoiding external threats
WT Strategies
Four-quadrant framework that indicates whether aggressive, conservative, defensive, or competitive strategies are most appropriate for a given organization.
Strategic Position and Action Evaluation(SPACE) Matrix
Internal dimensions to the SPACE Matrix
Financial Position(FP)/Competitive Position(CP)
External dimensions to the SPACE Matrix
Stability Position(SP)/Industry Position(IP)
Reveals the type of strategies recommended for the organization.
Directional Vector
Upper right quadrant in SPACE ; organization is in position to use internal strengths to 1) take advantage of external opportunities 2) overcome internal weaknesses 3) avoid external threats
Aggressive Quadrant
Upper left of SPACE ; Implies staying close to a firm’s basic competencies & not taking excessive risks
Conservative Quadrant
Lower left quadrant in SPACE; Suggest that the firm should focus on rectifying internal weaknesses and avoiding external threats.
Defensive Quadrant
Lower right of SPACE ; indicating competitive strategies including backward, forward and horizontal integration; market penetration; market and product development.
Competitive Quadrant
(+4, +4) | AGGRESSIVE PROFILES
A financially strong firm that has achieved major competitive advantages in a growing and stable industry
(+1, +5) | AGGRESSIVE PROFILES
A firm whose financial strength is a dominating factor in the industry
(-2, +4) | CONSERVATIVE PROFILES
A firm that has achieved financial strength in a stable industry that is not growing; the firm has few competitive advantages
