Ansoff's Matrix

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Ansoff's Matrix

Advantages

  • It forces market planners and management to think about the expected risks of moving in a certain direction
  • It lays out possible strategies for growth
  • Discipline: it focuses the business
  • Sets out aims and objectives
  • Presentable to stakeholders
  • Assessment of alternatives- shows opportunity cost
  • Creates a risk aware culture
  • Indicates level of risk and relevant risk

Disadvantages

  • Fails to show that market development and diversification strategies require a  change to every day running of the business
  • Only a theoretical model
  • Does not take into account the activities of external competitors
  • Paralysis by analysis
  • Plans too optimistic e.g. transferrable skills
  • Accurate predictions are difficult- unforeseen events
  • Conflicting objectives of stakeholders

Evaluation

It is useful in conjunction with other theoretical models. The role of the matrix is to provide an outline of alternative methods of achieving the final goal - growth

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