IFE matrix &

TOWS Matrix

IFE matrix &

TOWS Matrix

Internal Factor Evaluation ( IFE matrix)Based on the resource based view, a company’s strengths and weaknesses can be looked at based on the following internal parameters.

Integrating Strategy and CultureManagement( Planning, organizing, motivating, staffing and controlling)MarketingFinance/AccountingProduction/ OperationsResearch and DevelopmentManagement Information SystemsValue Chain Analysis( VCA)

2

An internal factor evaluation( IFE) allow strategists to summarise and evaluate strengths and weaknesses.

1. List key internal factors as identified in the internal- audit process. Include a list of 15-20 factors, including both strengths and weaknesses.

2. Assign each factor a weight that ranges from 0 ( not important) to 1( very important) .

3. Assign a rating between 1and 4 to each key internal factor to indicate how effectively the firm’s current strategies respond to the factor, where 4= the response is superior and 1= the response is poor

4. Multiply each factor’s weight by its rating to determine the weighted score.

5. Sum the weighted scores for each variable to determine the total weighted score for the organization

3

IFE of a white goods manufacturer

4

5

Integrating External and Internal Analyses: SWOT ANALYSIS AND THE TOWS MATRIX

• S W O TS W O T represents the first letter in– SS trengths– WW eaknesses– OO pportunities– TT hreats

• For a company’s strategy to be well-conceived, it must be– Matched to its resource strengths and weaknesses– Aimed at capturing its best market opportunities and

erecting defenses against external threats to its well-being

6

7

8

  External Opportunities(O)1.2.3.4.

External Threats (T)1.2.3.4.

Internal Strengths(S)1.2.3.4.

SO

"Maxi-Maxi" Strategies that use

strengths to maximize opportunities.

ST

"Maxi-Mini"

Strategies that use

strengths to minimize threats.

Internal Weaknesses (W)1.2.3.4.

WO

"Mini-Maxi" Strategies

that minimize weaknesses by taki

ng advantage of opportunities.

WT 

"Mini-Mini" Strategies that

minimize weaknesses

and avoid threats.

TOWS Strategic Alternatives Matrix