SPACE Matrix
-The Strategic Position and Action Evaluation (SPACE) Matrix.-
The axes of the SPACE Matrix represent two internal dimensions (Financial Position and Industry Position) and two external dimensions (Stability position and Industry position). Its four-quadrants framework indicates whether aggresive, conservative, defensive, or competitive strategies are most appropiate for an organization
The steps to develop a SPACE Matrix are as follows:
•Step 1: Choose a set of variables to be used to gauge the competitive advantage (CA), industry strength (IS), environmental stability (ES), and financial strength (FS).
•Step 2: Rate individual factors using rating system specific to each dimension. Rate competitive advantage (CA) and environmental stability (ES) using rating scale from -7 (worst) to -1 (best). Rate industry strength (IS) and financial strength (FS) using rating scale from +1 (worst) to +7 (best).
•Step 3: Find the average scores for competitive advantage (CA), industry strength (IS), environmental stability (ES), and financial strength (FS).
•Step 4: Plot values from step 3 for each dimension on the SPACE matrix on the appropriate axis.
•Step 5: Add the average score for the competitive advantage (CA) and industry strength (IS) dimensions. This will be your final point on axis X on the SPACE matrix. Add the average score for the SPACE matrix environmental stability (ES) and financial strength (FS) dimensions to find your final point on the axis Y.
•Step 7: Find intersection of your X and Y points. Draw a line from the center of the SPACE matrix to your point. This line reveals the type of strategy the company should pursue.
SABANERO
Burrito
El
SABANERO
Burrito
El
X-axis: 1,0
Y-axis: -0,4
•Aggressive position - an attractive and relatively stable industry, the company has a competitive advantage and it can protect it, a critical factor is the possible entry of new competitors into the industry, it may be considered new acquisitions, increasing market share and focusing on competitive products