Learning Activity #1 1. Copy and paste the Quantitative Strategic Planning Matri

Question

Learning Activity #1

1. Copy and paste the Quantitative Strategic Planning Matrix (see picture below) you created last week into this location and then discuss what the results of the matrix means, including a discussion on what strategic direction the selected company should take and why.

Copy and paste the Grand Strategy Matrix and Quantitative Strategic Planning Matrix you created last week into this location and then discuss what the results of each matrix means, including a discussion on what strategic direction the selected company should take and why. Here are the Matrices I did last week for Apple Inc: 1. 2. SPM Matrixfor Apple: Start Expand Key Internal Factors Weight producing production into Asia Wintel compatible AS TASAS TAS 0.15 3.00 045 Strengths Tunes Music Store is a good source of 0.15 1.00 revenue, especially with the iPod and the availability on Windows platform. Apple's niche audience provides the company with some insulation from the direct price competition. Good brand loyalty 020 4.00 0803.00 0.60 0.20 4.00 0.80 3.00 0.60 Web technology can be used to improve 0.15 4.00 0.63.00 045 product awareness and sales Weaknesses Weak relationship with Intel and Microsoft. 4.000.60 1.00 0.15 Weak presence in markets other than education and publishing. SUBTOTAL 0.15 2.00 0.30 4.000.60 1.00 3.25 2.85

Explanation / Answer

Learning Activity #1

The company selected here is Apple Inc.

In the given Quantitative Strategic Planning Matrix (QSPM), ‘AS’ stands for ‘Attractiveness Score’. Attractiveness Score denotes the significance or attractiveness of each factor (either internal or external) with respect to a particular strategy. The Attractiveness Scores vary from 1 being ‘not attractive’ to 4 being ‘highly attractive’.

There is another term ‘TAS’ in QSPM. ‘TAS’ is the acronym for ‘Total Attractiveness Score’ and is obtained as the product of weight assigned and the Attractiveness Score (AS) in every row of QSPM. Total Attractiveness Score signifies the attractiveness of a specific strategy in relation to each major factor. Greater the value of TAS, more attractive or better is the strategy.

Detailed Analysis:

The chosen company Apple has some major Internal Factors, viz., Strengths (4 in number) and Weaknesses (2 in number).

It also has some major External Factors, viz., Opportunities (5 in number) and Threats (3 in number).

The TAS for the Internal Factors for the strategic alternative “Start producing Wintel compatible” is more than the TAS for the Internal Factors for the strategic alternative “Expand production into Asia” by a score of 0.4 (= 3.25 – 2.85). However, in case of the External Factors, the TAS for the strategic alternative “Expand production into Asia” is much higher than the TAS for the strategic alternative “Start producing Wintel compatible”. It is higher by a score of 1.43 (= 2.36 – 0.93). Hence, Total TAS for the strategic alternative “Expand production into Asia” is greater than the Total TAS for the strategic alternative “Start producing Wintel compatible” by a score of 1.03 (= 5.21 – 4.18).

Therefore, the company Apple Inc. should go for “Expand production into Asia” strategic alternative.        

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