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Assignment No 1 Competitive Profile Matrix

The competitive profile matrix is a strategic management tool that compares a firm to its major industry competitors based on critical success factors. It rates each competitor on key factors, weights the importance of each factor, calculates a weighted score, and totals the weighted scores to determine the overall competitive position of each firm, with higher scores indicating a stronger position. An example matrix shows Company 1 is strongest compared to its competitors based on a total weighted score of 3.15.

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1K views2 pages

Assignment No 1 Competitive Profile Matrix

The competitive profile matrix is a strategic management tool that compares a firm to its major industry competitors based on critical success factors. It rates each competitor on key factors, weights the importance of each factor, calculates a weighted score, and totals the weighted scores to determine the overall competitive position of each firm, with higher scores indicating a stronger position. An example matrix shows Company 1 is strongest compared to its competitors based on a total weighted score of 3.15.

Uploaded by

Numan Rox
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
Download as docx, pdf, or txt
Download as docx, pdf, or txt
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STRATEGIC MANAGEMENT

Competitive Profile Matrix.

“Competitive profile matrix is an essential strategic management tool which is used to


compare one firm with the other major players in the industry. Identifies a firm’s major
competitors and its particular strengths and weaknesses.”

Components of Competitive Profile Matrix (CPM):

1. Critical Success Factors.


Extracted after deep analysis of external and internal environment of the firm. Critical
Success factors may vary from industry to industry.
2. Ratings.
Represent the response of firm toward the critical success factors. Higher the rating, better is
the response of the firm towards the critical success factor. Ratings range from 1 to 4 can be
applied to any factor.
3. Weight.
Indicates the relative importance of a factor to being successful in the firm’s industry.
4 = major strength 3 = minor strength
2 = minor weakness 1 = major weakness
0 carries the least importance while 1 carries the maximum and sum of all assigned
weight to factors must be equal to 1.
4. Weighted Score.
Weighted score is the result achieved after multiplying each factor rating with the
weight.
5. Total Weighted Score.
The sum of all weighted score is equal to the total weighted score and the Final value
of total weighted score should be between range 1.0 (low) to 4.0(high)
1 Page

UNIVERSITY OF CENTRAL PUNJAB.


STRATEGIC MANAGEMENT

Example of Competitive Profile Matrix (CPM).

Key findings.
Overall, Company 1 is strongest, as indicated by the total weighted score of 3.15, followed by
Company 3.

Hence, CPM shows how strong or weak a company as compared to its competitors on the
basis of critical success factors.
2 Page

UNIVERSITY OF CENTRAL PUNJAB.

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