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Making Matrix Organizations Actually Work

• Herman Vantrappen
• Frederic Wirtz

No org structure is without flaws, but matrices don’t deserve their bad reputation.

Most discussions about matrix organizations usually quickly devolve into a debate between two sides: those who love to hate the matrix, and those who hate to love the matrix. The former claim that a matrix structure slows decision making and obfuscates accountability. The latter retort that a matrix structure is an inescapable prerequisite for lateral coordination in large complex businesses. From our two decades of experience with organization design, we tend to side with the latter. In fact, we may even belong to a third camp, those who love to love the matrix. But our love is conditional upon its sparing and wise use.

• Herman Vantrappen is the managing director of Akordeon, a strategic advisory firm based in Brussels, and the coauthor of Fad-Free Strategy (Routledge, 2020).
• FW Frederic Wirtz heads The Little Group advising companies on organization design issues worldwide. He can be reached at [email protected].

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McKinsey GE Matrix: Importance & How To Use It (2024)

Making the right decision at the right time is hard. It’s a struggle business leaders know well. 

A broken decision-making process, the wrong strategic tools, and no visibility into the company’s portfolio performance can lead to failed strategies and large organizations going out of business. 

But the ability to recognize growth opportunities and cut dead-end strategies in time has always been a competitive advantage. And GE Matrix is one of the strategic tools that can help you in the process. 

In this article, we will cover everything you need to know about this framework, including HOW to use it, and WHEN you should use it.

⚠️ Go beyond the matrix!  While it helps prioritize investments, the GE Matrix shouldn't be the final stop. Cascade Strategy Execution Platform bridges the gap between portfolio analysis and action. Talk to a strategy expert and translate your GE Matrix insights into a strategic plan with clear ownership and measurable results.

• McKinsey’s GE Matrix is a visual tool designed to help portfolio managers determine resource allocation for multi-business portfolios.
• The GE Matrix looks at two factors when scoring SBUs (Strategic Business Units) — the strength of a particular business and the attractiveness of the industry.
• Pros: Along with providing an overview of SBU performance, the GE Matrix also prescribes three strategic paths (grow, hold, and harvest) to inform strategic decisions.
• Cons: The GE Matrix only offers a snapshot of business potential, which must be contextualized by strategic decision-makers.

What Is the GE Matrix?

The GE Matrix is a strategic framework that helps multi-business corporations manage portfolios and prioritize investments across products and SBUs (Strategic Business Units).

The GE Matrix looks at two factors: the competitive strength of an SBU and the attractiveness of the market in which it operates.

Based on where the SBU sits within the 3x3 GE Matrix, portfolio managers can quickly answer three strategic questions:

• How to allocate capital throughout the organization’s portfolio of companies?
• What products or additional SBUs are needed in their portfolio?
• Which SBUs should be divested?

The Components Of The GE-McKinsey Nine-Box Matrix

Let’s look at the components of the GE-McKinsey Matrix to make sense of the results.

The vertical axis scores the industry attractiveness (either low, medium, or high) of SBUs. A higher score on this axis will place an SBU higher in the GE Matrix.

The horizontal axis indicates the SBU's strength as either low, medium, or high. It moves from right to left, but it goes from high to low.

Invest/Grow (Green)

SBUs in these blocks have a mixture of solid business performance and an attractive industry. They are primed for growth and should be allocated resources and capital.

Selectivity/Earnings (Orange)

SBUs that fall within these blocks aren’t performing optimally or operate in an unattractive industry. These business units require a more conservative approach to either growth or divestment strategies.

Harvest/Divest (Red)

If an SBU is mapped in the red blocks, this indicates that a divestment/harvest strategy should be taken. Generally, this means that a business should be closed, further investment should be withheld, or the company should be run for cash.

How To Use GE Matrix?

1. determine the industry attractiveness of each sbu.

Calculate the market attractiveness in which each SBU operates. Remember, this is a subjective estimate based on your understanding of the SBUs industry or sector.

Score the SBUs industry by looking at factors like:

• Market size
• Industry profitability
• Market growth potential
• Industry segmentation
• Market profitability
• Differentiation
• Market growth rate
• Level of competition

Important note: The scale you use to score SBU strength and industry attractiveness will depend on your needs. Most businesses use a 1-10 scorecard, but you may want to use a different range when assigning values.

2. Determine the competitive strength of each SBU

You’ll then repeat this process for each company in your portfolio. Look at the strength of the business unit and its competitive position in the market.

Factors you can consider when working out the strength of a business unit:

• Sustainable competitive advantages (use VRIO analysis )
• Brand equity
• Customer loyalty
• Market share
• Internal competencies
• Strength of the value chain (use value chain analysis ) 
• Production capacity
• Product lines
• Pricing and cash flows
• Profit margin compared to competitors

Important note: Different factors have different levels of importance. When calculating industry attractiveness and business strength scores, you’ll need to weigh numerous factors to reflect this.

3. Plot the information on the GE Matrix

Next, plot the values for each strategic business unit on your Matrix. Use the market attractiveness score to plot your Y-axis position and the business strength score to plot your X-axis position. 

The location of each SBU on the 3x3 chart will indicate whether the company should grow, hold, or harvest specific business units.

4. Identify the future direction of each SBU

The GE Matrix only provides a view of the current state of SBUs in a portfolio and doesn’t account for other variables that may impact a business's viability.  

This means that teams that use the GE Matrix must analyze business units in more detail to understand all strategic implications.

Using different strategic analysis tools, such as SWOT analysis , Porter’s 5 Forces , or PESTEL analysis, could help you analyze internal and external environmental factors. This will also help you to identify potential risks in the future.

5. Choose where to invest and focus your attention

Once you have a picture of your portfolio mapped out on the GE Matrix, you’ll still need to answer some critical questions before making decisions about SBUs.

For example, how much money should you put into a specific business unit? Does investing in these SBUs align with your long-term strategy? Which parts of a particular SBU should you invest in? 

As Michael Porter, the father of the modern business strategy, says, “ The essence of strategy is choosing what not to do ”.

 At this point, you should clearly understand what your organization will focus on. This will help your organization to stay on the right track and prevent wasting resources on misaligned efforts.

6. Turn insights into results

With a clear idea of direction and new priorities, you should take those insights and turn them into an actionable strategic plan. 

A strategy execution platform like Cascade can streamline the process of communicating new goals, strategizing, and executing strategic initiatives. It can also help your organization ensure performance and align your portfolio strategy with the company’s high-level strategy.

3 Examples Of GE Matrix And Its Possible Strategic Scenarios

Ge matrix example (harvest strategy): microsoft internet explorer.

At one point, Microsoft Internet Explorer, was the dominant internet browser in the market. In 2003, more than 95% of all internet users were using it to surf the web. Here’s how the GE Matrix might look for the Internet Explorer SBU over time.

The 2003 Microsoft Internet Explorer was:1) A strong business unit 2) In an attractive industry

It would have been somewhere in the top left corner of a GE-McKinsey Matrix.

However, more web browsers started to appear, and the industry became more competitive. By 2010, Microsoft had lost 35% of its web browser market share to other competitors such as Firefox, Chrome, and Safari. 

After 2010, the Internet Explorer SBU likely scored lower in competitive strength and market attractiveness compared to its earlier days.

Based on these significant changes, Microsoft likely decided that the Internet Explorer business unit would need to be closed, run for cash, or selectively harvested. 

And that’s the strategy the company followed over the next 12 years.

• In 2013 , Microsoft released the last version of Internet Explorer (IE 11).
• In 2015 , they launched a new web browser, Microsoft Edge.
• In 2022 , they ended support and retired the program.

GE Matrix Example (Hold Strategy): David Jones 

In 2014, Woolworths Holding Ltd., a prominent South African retail chain, acquired Australian retailer David Jones, believing it could generate A$130 million per annum in earnings within five years. 

According to Woolworths Holding Ltd., David Jones had:

• A strong SBU with a 176-year history in Australia
• An attractive industry with a strong position in the retail market.

Here’s an example of how David Jones’ GE Matrix might have looked between 2014 and 2021:

However, the David Jones brand underperformed, and original plans to expand operations stagnated. Here’s how its position might have looked in 2015.

Woolworths Holding Ltd. likely decided to take a selective harvest/grow approach in response to the changing Australian retail market. This strategy is evident in some of their significant decisions between 2015 and 2022.

• In 2015, David Jones implemented several cost-cutting measures, such as restructuring the organization, cutting floor space in all stores, reducing product ranges, and firing top IT executives . 
• In 2016 , they shifted their head office from Sydney to Melbourne, siting lower real estate costs as one of the factors. 

In 2020, David Jones closed 48 stores ; in 2021, they sold two properties worth A$620M to free up capital.

GE Matrix Example (Grow Strategy): Netflix

Nowadays, Netflix, the online streaming company that revolutionized the entertainment industry, is a household name. 

However, when Netflix released its streaming service in 2007 , it made up a tiny portion of the company’s revenue, offering 1,000 titles for streaming, compared to the 70,000 titles in physical DVD format. 

Here’s an example of how Netflix’s streaming SBU might have looked in 2007.

In 2010 , Blockbuster, Netflix’s largest competitor, filed for bankruptcy, further propelling its online entertainment streaming industry dominance. 

As internet speeds increased, technology improved, and consumer preferences shifted towards streaming, Netflix’s video-on-demand service SBU would have moved to an aggressive growth strategy block on the GE Matrix.

Netflix continued its growth path and rapidly expanded between 2012 and 2021:

• In 2012 , the platform had 20 million subscribers, consumed 30% of all residential US bandwidth, and launched in the UK.
• By 2018 , Netflix had 125 million subscribers and a market value of $151 B.
• In 2020, Netflix added 36 million subscribers to its user base and had a net income of $2.76 B .

Advantages of GE Matrix

The advantages of GE Matrix are: 

• A simplified approach to portfolio analysis and investment allocation decisions
• Highly replicable and consistent framework
• Applicable across different industries
• An efficient method of determining strategic paths for multiple SBUs
• Helps measure and map the strategic position of SBUs
• Helps understand which businesses are making a profit and which aren’t

Limitations of GE Matrix

The possible limitations of GE Matrix are: 

• The GE Matrix is only a snapshot of your portfolio’s performance
• It relies on subjective estimations of market attractiveness and business strength
• Lacks nuance in differentiating between SBUs
• Teams may need to do more research before they can make investment decisions
• May not be suited for emerging or rapidly-evolving industries

When Is The GE Matrix Framework The Best Choice?

While the GE Matrix doesn’t offer a complete picture of SBU performance, its simple design means that strategic thinkers can quickly get a snapshot of how different businesses or product portfolios are performing.

Strategic portfolio management , PMOs , and corporate-level decision-makers will benefit from using the GE Matrix to inform their strategic investment planning.

Recommended reading: How successful PMOs deliver value and avoid the hot seat

GE Matrix + Strategy Execution = 🚀

GE Matrix and other strategic frameworks are great for fleshing out your strategy, but to successfully execute strategy and adapt as needed, you also need the right software. 

A great strategy execution platform will help you to create a single source of truth for your strategy, eliminating wasted time in disconnected spreadsheets , confusion and potentially preventing a failed strategy execution. A single home for your strategy will help you to keep everyone on the same page, allowing leaders to focus on the most critical parts of strategy execution: robust goals, context, and strategic thinking. 

And when you are not wasting time in meetings to keep everyone aligned, you can focus on maximizing the ROI from your portfolio. 

Cascade makes it easy to build strategic portfolio plans and assign KPIs and owners to drive accountability. It lets your team collaborate on shared goals to drive strategy execution across the organization. 

Interested in seeing Cascade in action? Get started for free or book a demo with Cascade’s expert.

FAQs About GE Matrix 

Who created the ge matrix.

The GE Matrix was created for General Electric by McKinsey in the 1970s to help decision-makers with investment decisions about their various SBUs. 

What is the difference between the GE and the BCG Matrix?

The GE Matrix is used by businesses to prioritize investments and looks at industry attractiveness and SBU strength. Boston Consulting Group’s BCG Matrix is used to deploy resources and looks at the product growth rate and market share for SBUs.

Is the GE Matrix better than the BCG?

No, the GE Matrix and BCG Matrix have different purposes. Depending on your current needs, one may be better than the other. However, both are useful tools for strategic planning .

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Top 10 Business Matrix Templates with Samples and Examples

If starting and running a business was easy, everyone would be a billionaire! The richest 1% own almost half of the world’s wealth. That’s how unforgiving today’s business landscape is. You have to juggle multiple things to bring order and structure within your business space. Having a clear vision backed with an actionable plan is non-negotiable to achieve it! But how to ensure you don’t end up with the wooden spoon? The short answer: Business Matrix Templates . These provide a clear roadmap for strategic decision-making, helping to identify the most optimal routes for growth, avoid potential obstacles, and reach the destination of success. Using these PPT Sets, businesses can make well-informed choices, ensuring they stay on track and achieve their desired objectives.

Business Matrix: Your Path to Strategic Growth

Creating an insightful business matrix involves careful consideration of the specific goals and objectives. Here are some key steps to make an insightful business matrix:

• Define the Purpose: Clearly outline the inspiration for the matrix. Is it for performance review, risk assessment, strategy planning, or something else?
• Choose Relevant Factors: List the crucial elements that the matrix must contain and that support the objective. For example, market growth rate, market share, customer satisfaction, or financial metrics.
• Data Collection: Compile reliable and precise information for every aspect. This might include data on internal performance, financial reports, consumer surveys, or market research.
• Normalization: Ensure that factors with various scales or units may be compared on an equal footing by normalizing the data.
• Assign Weights: In line with their proportional importance in achieving the objective, assign every component its appropriate weights.
• Plot the Matrix: Depending on the complexity, visualize the data by displaying it in a matrix format, such as a 2x2 matrix or a multi-dimensional matrix.
• Analyze and Interpret: Analyze the matrix to derive insightful conclusions and judgements. Determine trends, patterns, and areas of emphasis.
• Make Informed Decisions: Apply the matrix's insights to develop data-driven plans that take into account both opportunities and obstacles.
• Update and Iterate: To keep the insights current and applicable, update the matrix frequently with fresh data.

If this seems too much work, you can just download and edit our PPT Presentations to build an effective Business Matrix that suits your purpose. SlideTeam has assembled these pre-designed and 100% customizable and editable PowerPoint Templates on Business Matrix . The content-ready nature provides you with a starting point and the structure you were looking for; the editability feature ensures you can tailor the presentation according to the business’s requirements.

Let us have a look at the templates now.

Template 1: Business Risk Measurement and Assessment Matrix

This PPT Template highlights the risk measure assessment matrix. It shows the percentage of impact probability based on levels of risk like insignificant, minor, moderate, major, and disastrous. The table is color coded for clear understanding. Here Red denotes extreme, yellow indicates high, light green shows moderate and dark green represents low. Download this slide now!

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Template 2: Business Competitor Analysis Matrix Based on Key Product Traits

This PowerPoint Template showcases competitor analysis based on key product traits like performance, quality, service, warranty, etc. It facilitates a side-by-side comparison of different competitors in the market, enabling businesses to identify their strengths and weaknesses relative to their own offerings. Companies can gain valuable insights into their competitive landscape, make data-driven decisions, and formulate effective strategies to enhance their overall market positioning by analyzing key product traits. Download this PPT Slide now!

Template 3: Business Importance Matrix with Four Quadrants

This PPT Set is designed to assess tasks based on their importance and performance. The matrix is divided into four quadrants to categorize tasks accordingly. The first quadrant represents tasks that are of high importance and require significant attention and focus. The second quadrant indicates tasks that are performing well and should be maintained to sustain success. The third quadrant comprises tasks of low priority, suggesting they can be addressed later. The fourth quadrant contains tasks that might receive excessive resources or effort, possibly indicating overkill. This matrix assists companies in improving work management and resource allocation for increased efficiency and production. Download now!

Template 4: Agile Business Roles and Responsibilities Maturity Matrix

This PPT Design illustrates the progression of roles and responsibilities within an organization's agile framework. The matrix is divided into four stages: Learning, Practicing, Optimizing, and Scaling, representing the maturity levels from less mature to more mature. The template covers topics critical for agile success, such as agile rules and regulations, team collaboration, agile governance, team productivity, and agile planning. This matrix aids businesses in assessing their agile maturity and planning their journey toward higher efficiency. Get this Slide now!

Template 5: Business Matrix for Agile Project Management Estimation Plan

This PPT Slide presents a comprehensive organizational framework for agile project management and estimation. It outlines essential information such as tasks, departments responsible, start and end dates, budget estimates, and priorities. The listed tasks encompass activities, including QA Testing, recruitment, implementing end-to-end encrypted software, and launching social media marketing campaigns. This matrix helps streamline project execution, allocate resources efficiently, and set clear priorities. Download Now!

Template 6: Market Attractiveness Matrix with Business Potential

This PPT Design presents a four-stage process to evaluate different market opportunities. The stages include Market Attractiveness and Matrix Business Potential. Within the matrix, each stage is categorized as high, medium, or low, indicating the potential of each market opportunity. The three main headers, namely "Invest/Grow," "Selective Investment," and "Harvest/Divest," further clarify the approach for each market segment. This template helps businesses prioritize and strategize their market expansion efforts for optimal results. Download Now!

Template 7: Retail Business Growth Strategies Matrix

This PPT Set displays an overview of four crucial stages for retail business expansion. These stages are Market Penetration, focusing on increasing market share; Market Expansion, exploring new business opportunities; Business Format Evaluation and Development, assessing and improving existing business models; and Product Line Diversification, expanding the range of products offered. Each stage is represented with distinct icons for visual clarity. Get this template now!

Template 8: Quarterly Business Roadmap Matrix with Key Tasks

This PPT Slide showcases a representation of the activities conducted across different departments within an organization. It includes key departments like operations, product, sales, marketing, and finance. It showcases a table with four quarters, each indicating the percentage of task completion for the respective activities. This matrix allows stakeholders to track progress over time, assess the efficiency of each department, and identify areas that may require more attention. Download Now!

Template 9: Business Priorities Task Urgency Matrix

This PPT Template is designed to assist businesses in prioritizing tasks based on their importance and urgency. This slide includes four tasks, which consists of business priorities, goals, and objectives. Tasks are color-coded to indicate their level of importance: red for high importance, green for moderate importance, yellow for low importance, and blue for minimal importance. Additionally, the urgency of each task is taken into account, distinguishing between high and low urgency. This matrix can be used by organizations in order to efficiently allocate resources, focus on critical tasks, and ensure timely completion of projects aligned with their strategic objectives. Download Now!

Template 10: Business Decision Matrix with Different Projects

This PPT Slide illustrates the decision-making process for projects in a concise and organized manner. It outlines essential steps, including brand development, product strategy, competitive analysis, and more. In addition, the template enables effective communication and collaboration among team members and ensures informed and data-driven decisions are made throughout the project lifecycle. It is a vital tool for optimizing resource allocation and maximizing project success. Download Now!

Chart Success and Unlock Insights through a Well-Aligned Business Matrix

In a rapidly evolving business environment, using a business matrix is not merely an option; it is a necessity for sustainable growth and prosperity. By unlocking the potential of their data through insightful analysis, businesses can gain a competitive edge and thrive in an ever-changing market.

PS: In a fast- paced business model, effective time management is essential. To help our readers in their time management endeavors, SlideTeam has curated a set of useful PowerPoint decks and slides. Follow this Link for the Top 10 Time Management Matrix Templates to Raise Business Efficiency.

FAQs on Business Matrix

What is a business matrix.

A business matrix is a systematic framework for analyzing and interpreting data so that strategic business choices may be made. It presents complex information in a visual format, typically using a grid or table, to facilitate comparison and identify patterns, relationships, and opportunities. Business matrices, including SWOT analysis, the BCG growth-share matrix, and decision matrices, are used for tasks like risk analysis, product appraisal, and strategic planning. Business matrices are valuable tools for businesses to gain insights, prioritize actions, and achieve sustainable growth by leveraging data-driven approaches.

Why are matrices used in business?

We use matrices in business for several reasons. They provide a structured and visual way to organize and analyze complex data, helping businesses make informed decisions. Matrices help identify strengths, weaknesses, opportunities, and threats, allocate resources effectively, prioritize growth areas, and assess potential risks. By leveraging matrices, businesses gain valuable insights, streamline operations, and develop data-driven strategies, leading to increased efficiency, competitive advantage, and sustainable growth in dynamic markets.

What is a business matrix diagram?

A business matrix diagram is a visual representation of data and relationships in a structured grid or table format. We use it to organize complex information and analyze various factors simultaneously. Each cell in the matrix represents a specific combination of factors, making it easier to compare, identify patterns, and draw insights. Business matrix diagrams are valuable tools for strategic planning, market analysis, resource allocation, and risk assessment, enabling businesses to make well-informed and data-driven decisions.

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Matrix Organizational Structure – A Quick Guide

Table of Contents

What is a matrix organizational structure.

• How Does a Matrix Structure Work?
• Pros and Cons of a Matrix Structure

Types of Matrix Organizational Structures

If you need to manage multiple projects, it’s recommended to have a matrix organizational structure in place . Projects have many activities, from resource planning to task management and everything in-between. Therefore, that organizational structure shouldn’t be rigid, but flexible and efficient.

Every organization is structured in some way, and that structure is determined by its business goals and project objectives. The way you structure the functional areas of an organization is going to offer a standard for operating procedures and routines. It will also determine what your team members do, and what project management tools are best for the job at hand.

Matrix organizational structures are often used in project management because they speak to both the product of the project and the function of the management producing it. Let’s take a closer look at this type of organizational structure to determine its pros and cons in project management.

A matrix organizational structure is a combination of two or more organizational structure types. The matrix organization is the structure uniting these other organizational structures to give them balance.

Usually, there are two chains of command, where project team members have two bosses or managers, a functional manager and a project manager . These roles are fluid and not fixed, as the hierarchical structure between these two kinds of managers isn’t organizationally defined.

This two-boss matrix will employ the best of both organizational charts and management styles to strengthen strengths and make up for weaknesses. This way, if an organization is working on producing two products or services at the same time, they can organize both and use that duality to their advantage through the matrix organizational structure.

Managing multiple projects requires robust project management software. ProjectManager has an overview section that includes portfolio roadmaps. This Gantt chart view lets you see all the projects in your portfolio on one page to better strategize resource planning. Get better organized today by trying our tool for free. 

How Does a Matrix Organizational Structure Work?

A matrix structure is more than just overlapping an organizational chart on top of another. Using matrix organizations requires careful planning and team collaboration tools.

Matrix structures work by fostering cross-team collaboration and shared resource planning across projects. Simply put, a matrix organization structure reorganizes companies to maximize their productivity and uses two chains of command to make them more dynamic.

Pros and Cons of a Matrix Organizational Structure

A matrix organizational structure is not a one-size-fits-all solution. There are advantages and disadvantages that need to be understood to know if it’s the right one for the organization. Plus, there are three types of matrix structures that you’ll need to know before making a decision. But before we learn about those types, here are the main pros and cons of using a matrix structure.

A matrix organizational structure can benefit your company because:

• It allows the sharing of skilled resources between functional units and projects, which facilitates resource planning.
• It fosters better cross-functional communications, which improves team collaboration and builds a more dynamic organization.
• It helps organizations achieve their goals at a faster pace, thanks to a higher use of material and human resources.
• This structure is great for employees who are looking to widen their experience and skill sets. It puts them in an environment that facilitates learning and gives them an opportunity to grow professionally.

As usual, there’s also some cons associated with the use of matrix organizational structures:

• There can be some confusion about the organization’s hierarchical structure when a team member is subject to two managers, and it can be difficult to reach a balance of power between them. That can also create unnecessary conflict.
• Limited resources can become an issue if managers don’t communicate during the resource planning process.
• There are a lot of managers in a matrix organizational chart, which is not to everyone’s liking. And having more people in managerial positions affects the company’s costs.
• Team members can feel the strain of working in a matrix organizational structure, in that their workload can be heavy.

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RACI Chart Template

Use this free RACI Chart Template for Excel to manage your projects better.

The main difference between these matrix structure types is the balance of power between the functional manager and the project manager. Let’s see how they differ.

Weak Matrix Organization

In a weak matrix organization, the functional manager oversees all project management areas and is the highest authority in the decision-making process throughout the project. The project manager on the other hand has a much lower authority and has to answer to the functional manager.

Balanced Matrix Organization

In this type of matrix structure, the project manager has more authority than in a weak matrix organization. The functional manager still acts as the primary managerial authority in the decision-making process.

Strong Matrix Organization

In a strong matrix organization, the project manager has equal or more power than the functional manager. The project manager has control over resource planning and task management .

ProjectManager Can Help you Run a Matrix Organizational Structure

Given the complexity of a matrix organizational structure, it’s critical to have the right project management tools to make sure team members are receiving their tasks in a clear and orderly fashion. Two bosses can create a muddle, so having all project communication housed in one software is essential.

ProjectManager has a “My Work” section that enables team members to see all of their tasks in one place, regardless of whether a project or functional manager assigned it to them. This enables them to manage their workflow more efficiently, marking their progress and adding comments along the way for managers. They can also work on tasks by projects too if they want to stay in one mindset before moving on to another project.

For project and functional managers, the reporting tools in ProjectManager can be nothing short of essential. With a real time project dashboard and advanced reporting features, management can always keep abreast of what’s going on. With ProjectManager, you can make a project report with just one click . Our reports include status reports, task reports, variance reports, availability reports and more. This is an all-encompassing project management software that suits everyone in the organization.

Related Organizational Planning Content

• What Is Organizational Planning in Project Management?
• What Is Organizational Strategy in Business? (Examples Included)
• Organizational Resources Basics: Managing Company Resources
• What Is Organization Design? Types, Principles & More
• Organizational Process Assets: Definitions, Examples & Templates

When dealing with multiple projects, a matrix organizational structure can give you an advantage, but only if you and your team are equipped with powerful tools. ProjectManager is a cloud-based project management software that is built to manage projects of all sizes and levels of complexity. Its real-time data keeps managers updated and gives project teams a collaborative platform. Try it today with this free 30-day trial.

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The Quantitative Strategic Planning Matrix (QSPM)

Choosing the best strategic way forward.

By the Mind Tools Content Team

Organizations spend a lot of time and effort on strategy formulation.

Often, there are several different approaches or strategies that the organization could follow. But how do you decide which option is best? Do you rely on intuition, or take a more objective approach?

Not surprisingly, you need to base your decision on facts, not gut feelings. But how do you do this, particularly when the effects of different strategies can be so different?

The Quantitative Strategic Planning Matrix (QSPM) helps you address this question. It gives you a systematic approach for evaluating alternate strategies and helps you to decide which strategy is best suited to your organization. The tool was developed by Fred R. David, and was first published in the Long Range Planning Journal in 1986.

Understanding the Matrix

QSPM is based on three primary inputs:

• The Critical Success Factors of your business unit.
• The relative importance of each of these critical success factors.
• How you rate a particular strategy by each success factor.

These inputs are used to evaluate the relative attractiveness of different strategies. This relative attractiveness is expressed in terms of a number, the "Sum Total Attractiveness Score". The higher this score is, the more attractive the strategy is.

Follow the step-by-step guide below for constructing a QSPM. Start by printing our free worksheet , and use it to compute your answer.

Step 1: List the Critical Success Factors

Make a comprehensive list of the critical success factors that apply to your business unit. These can be divided into two groups: internal factors and external factors.

Internal factors can relate to your company's inherent strengths and weaknesses, whereas external factors can relate to the opportunities and threats in the market environment.

Internal factors could include the maintenance of sufficient production capacity; a strong flow of new technologies from R&D; efficient treasury management; and so on. Examples of external success factors include the rapid adaptation to new government policies; effective competitive analysis; and quick understanding of the implications of demographic trends.

At this stage, it's important that you try to generate a comprehensive list of the most important critical success factors. This helps to ensure that the key issues are addressed in the comparative analysis process.

Now use this list to fill the first column of your matrix. Make sure that each critical success factor is listed under the appropriate internal or external category.

QSPM uses Critical Success Factors as the basis of analysis. This can be a good starting point for an existing organization. However, these will not yet exist for a start-up organization, and approaches like the use of core competences may be more appropriate for some organizations. Challenge the criteria you're using to make sure that you're using appropriate ones.

Step 2: Assign Weights

Assign a weight to each of these critical success factors, depending on how important it is to the success of your work unit. The higher the importance, the higher weight it will carry. The sum of all weights attached to internal factors should equal 1.0, as should the sum of factors attached to external factors.

Note down the weight you have assigned to each factor in the second column, adjacent to the name of that factor.

Giving internal and external factors the same weight in the decision can seem arbitrary. Decide for yourself whether this is appropriate.

If you’re struggling to assign weights, techniques like Paired Comparison Analysis can help.

Step 3: List the Strategies

Now record the different strategies and approaches that you want to compare as column headings in the top row of your QSPM. The best part about QSPM is that you can compare as many strategies as you like simultaneously.

Step 4: Assign Attractiveness Scores

For each strategy, work your way through the rows of your QSPM, assessing the attractiveness of the strategy as it affects each critical success factor. Score each CSF on a scale of 1 – 4, where the strategy is:

1 = Not attractive at all 2 = Slightly attractive 3 = Attractive 4 = Very attractive

Record this score in the Attractiveness Score ( AS ) column. This score represents how attractive the strategy is when looked at from the perspective of the listed critical success factor.

If a strategy does not impact one or more of the Critical Success Factors, then no AS is assigned for that factor for any strategy. In this situation simply put a dash instead of a score for all the strategies.

QSPM uses the 1 – 4 scale above. You may prefer to rank using a different scale, for example -4 to +4, where -4 applies to a strategic approach that seriously harms progress towards a Critical Success Factor.

Step 5: Calculate the Weighted Attractiveness Scores

For each Attractiveness Score/Weight combination on your QSPM table, calculate the Weighted Attractiveness Score ( WAS ) by multiplying the weight by the AS you have assigned for that factor.

Step 6: Sum the Total Attractiveness Scores

Sum all the WASs for each column and arrive at the Sum Total Attractiveness Score for each strategy. Record it in the bottom row. This represents the desirability of that particular strategy.

Many business decisions are made using financial models that take into account investment and expected outcomes, with options offering the greatest Return on Investment being chosen as the way forward.

While this is correct from one point of view, it excludes non-financial factors from the decision-making process. For example, it can cause the business to lose strategic focus, as the company follows financially attractive projects that may go against the long-term interest of the organization.

This is where it can be useful to bring a technique like QSPM into the decision-making process, to act as a "sanity check" on decisions made.

If you're considering using this approach, you may also want to take a look at Decision Matrix Analysis , which does a similar thing in a more streamlined way.

QSPM is a useful analytical tool that helps you determine the relative attractiveness of different strategies.

It asks you to identify the important external and internal critical success factors for your business unit, and then helps you assess these strategies in the light of these critical success factors. This effect is evaluated in numerical terms. The strategy that scores the highest is usually your best choice.

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Cory OBrien

The worksheet link brings me back to the article instead of to the worksheet. Both the link in the article and the download link at the end of the article.

over 1 year

Tshiamo Mokgadi

I get the same loop.

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How to use the Ansoff Matrix for strategic planning (with examples)

If the last couple of years have taught us anything, it’s that the marketplace can change quickly and without warning. In case you were wondering, yes — we are talking about the pandemic.

To keep up with changes, businesses need to adapt to their surroundings. This means creating new plans for growth and tailoring your business strategy to align with market trends and consumer behavior.

But how can you create a corporate strategy that’ll help your business succeed in the long run?

Enter the Ansoff Matrix.

The Ansoff Matrix helps businesses figure out which avenue to go down to give themselves the best chance of growth and success.

Keep reading to find out more about what the Ansoff Matrix is, how to implement it in your business, and the pros and cons of using it.

• What is the Ansoff Matrix?

The Ansoff Matrix is a strategic tool that helps businesses evaluate growth opportunities. Also known as a product or market expansion grid, it can come in various formats. But generally speaking, people use Igor Ansoff’s matrix from 1957 (see below).

The matrix has four key quadrants: market penetration, market development, product development, and diversification (more on this later). Using the grid, businesses review the potential risks of each option and create a growth plan.

• What are the benefits of using the Ansoff Matrix?

Now that we know what the Ansoff model is, let’s take a look at some of the benefits of using it.

Assess risk

Analyzing risk is a key part of business growth. If you’re not prepared for what might go wrong, you’re putting your business in a pretty vulnerable position.

That’s where an Ansoff Matrix strategy can help. Each quadrant helps business owners weigh the risks and prepare accordingly.

Imagine you’re thinking about diversifying your product market. You currently sell your product in the U.S., and you want to expand to the UK market.

The Ansoff Matrix helps you identify the risks associated with this diversification strategy. For instance, you might have to offer your product at a lower price to penetrate the market. This could mean losing out on potential revenue for the first six months of the expansion.

By identifying this potential risk, you can prepare your business to deal with it and give your growth strategy the best chance of success.

Identify the best strategy for growth

If you’ve decided to use the Ansoff Matrix, chances are you want to experience business growth.

The good news is, you’ve picked the right tool.

The Ansoff Matrix is designed to help businesses take a strategic approach when planning business growth. Using the four quadrants (which can be filled in using the Ansoff Matrix template below), businesses make informed decisions about which avenue to pursue with the highest chance of success.

It also helps you identify new strategies for growth that you might never have thought about before. If you’re thinking about how you can grow and develop your business, the Ansoff Matrix is a great place to start.

• Are there any downsides to the Ansoff Matrix?

As with every business tool, there are pros and cons. The Ansoff Matrix is no exception, so let’s take a look at some of the downsides.

The reward isn’t measured

To make a well-rounded decision, it’s helpful to compare risk with reward. Unfortunately, the Ansoff Matrix doesn’t allow you to do this. And without this additional information, you could miss out on potential growth opportunities.

Let’s say you’re using the Ansoff Matrix. You look at how you can boost sales with your current product in your current market (market penetration). You also look at launching a new product to a new market (diversification). The matrix tells you that trying to boost sales in your current market is low risk, while launching a new product is high risk.

This is correct, but the matrix hasn’t taken reward into account. Launching a new product to a new audience could have a greater return on investment (ROI) in comparison to boosting sales on existing products. The risk might be higher, but the reward might be as well.

It’s tricky to compare risk and reward with the Ansoff Matrix. You’ll have to do this separately to figure out if your strategy is an avenue worth pursuing.

It doesn’t capture the big picture

The matrix is great for helping you plan your strategy, but it’s pretty simple in its structure. As a result, a lot of extra thought is required to visualize the bigger picture.

Take competitors, for example.

There’s no way to review competitors with the Ansoff Matrix. Instead, you have to do a competitor or SWOT analysis separately and integrate what you’ve learned. It’s not the end of the world, but it means that the process isn’t as streamlined and efficient as it could be.

The Ansoff Matrix is great for finding the best strategy for growth and analyzing risk, but it does have some limitations. So long as you’re aware of what these are before you start using the matrix, you can make sure your growth strategy is as robust as possible.

• How to use the Ansoff Matrix for strategic planning

Ideally, you should use the Ansoff Matrix whenever you do strategic planning .

Because a successful strategy should help your business grow and succeed, and that’s exactly what the matrix does best. Some businesses also find it helpful to fill out the matrix more regularly, especially if conditions change rapidly in their industry.

So how do you use the Ansoff Matrix for strategic planning?

Unfortunately, there’s no one-size-fits-all solution. It all depends on the industry you’re in, your position in the marketplace, and what you’re trying to achieve.

However, we can offer some advice. To do this, we’re going to give you a full rundown of each quadrant, when it’s best to use it, and examples of companies that have done it well.

• Understanding the four key quadrants and how they help with strategic planning

We’ve briefly touched upon the four quadrants of the Ansoff Matrix. Now, let’s look at them in more detail and outline how they can help your business with strategic planning.

Market penetration

First up, our top left contender: market penetration.

A market penetration strategy focuses on boosting sales in your existing market and to an existing customer base. For example, you could offer an incentive to increase sales. Or streamline your order and delivery process by adding more distribution channels.

It’s the most low-risk quadrant of the matrix, which makes it the “safest” option for businesses — but that doesn’t necessarily mean it’s the right choice. As we’ve already mentioned, it all depends on your goals and the industry you’re working in.

When to use market penetration

If any of these goals are on your list, market penetration could be the way to go:

• Market share growth
• Increase customer loyalty
• Improve customer value

If you decide to use market penetration, Miro’s chart feature could be incredibly useful to you. You can integrate our chart within the quadrant itself, allowing you to visualize areas where market penetration could increase your sales and improve your business.

Real-life example: Under Armour

In recent years, Under Armour has surpassed Adidas to become the second-largest athletic-wear provider in the U.S.

With market penetration.

To increase its market share, the company increased spending on endorsements and advertisements by 35% . This included signing professional basketball player, Stephen Curry , to launch the Curry Brand.

This is where it gets interesting.

The release of his signature shoe resulted in footwear growth of almost 95%.

This is a great example of using market penetration to increase market share. By releasing a new product with a well-established sportsperson, Under Armour surpassed Adidas to become the second-largest athletic-wear provider in the U.S.

Product development

Product development involves introducing a new product into the marketplace. Or, if you’re a SaaS business , introducing a new service.

When to use product development

The clue is in the name with this one. Generally speaking, most businesses use a product development strategy for the following:

• To expand their current product line/services
• To offer a completely new (but similar) product to the same market

If you’re thinking about pursuing product development, take a look at Miro’s collaboration tools .

A product development strategy will require a team of people to pull it off, so using a collaborative platform is pretty important. This is where Miro can help.

With our software, teams can seamlessly collaborate and communicate across departments. For example, users can add comments , tag users, and even share their screens .

Real-life example: Karma

Karma’s co-founders, Stas Kulesh and David Kravitz, had been running their own design and development company for over 10 years.

When the team shifted from using email communication to business chats, they created Karma. It started as a rustic, internal tool to keep each other accountable and motivated.

Using Miro to collaborate and communicate, the team began to share, discuss, and document their ideas about how Karma could be used by other businesses. The visual workspace became a vital and multipurpose tool for Karma’s distributed team during various stages of development.

The company used brainstorming and impact mapping templates to create a visual overview, allowing everyone involved to see the current status of the project.

Before long, the Karma Bot was born. Karma Bot is a tool used by teams to track performance, handle promotions, assign rewards and bonuses, and review salary appraisals.

After launching the product, it was quickly apparent that other companies were interested in using the services Karma Bot had to offer. By using product development, Karma fulfilled a need in the marketplace and provided consumers with a new, in-demand service.

Market development

Market development is riskier than both market penetration and product development. It involves launching an existing product into a new market. This can be done as follows:

• Finding a new use case for your product
• Adding features to meet a different customer need

When to use market development

Market development is often used when a business wants to diversify its audience. For instance, if it’s targeting an audience aged 18-25, the business might try to target an audience aged 19-30.

It can also be used if a business discovers a new use for its product or service. For instance, some changes in the marketplace could mean that you have a whole new audience to target.

Look at the pandemic, for example. Before, face masks would usually have only been supplied to medical offices and hospitals. Now, they’re supplied to businesses of all sizes and varieties as well as individual consumers.

If you’re considering market development, take a look at our user persona template to help you figure out who your new target audience will be.

Real-life example: National Van Lines

National Van Lines started as a B2C company, helping customers with their moving needs. However, the company used a market development strategy to expand into the B2B market.

By partnering with regional companies and agents, National Van Lines expanded its sales reach to include national and international B2B relationships.

By working with these partners, the company built direct relationships and expanded its B2B sales. They still offered the same service to their existing customers but also targeted a whole new customer base with the same service.

Diversification

Diversification is the riskiest of all the quadrants. It involves introducing an entirely new product into a new market.

Successful diversification takes a lot of work. You need to be extremely clear on your business goals, prepare yourself for the risks, and thoroughly review your financial situation. You’ll also need a solid marketing team in place to make sure there’s a market for your new product or service and that you launch everything successfully.

Although it’s the riskiest, it can have the biggest payoff — when used in the right circumstances, of course.

When to use diversification

Here’s when you might consider using diversification:

• If you want to expand into a new industry or market you haven’t currently explored.
• If you’re looking to expand your current business. For example, a graphic design company that starts to offer design products. This might still appeal to their current audience, but they’ll also reach a whole new audience in the process.

If you opt for diversification, check out Miro’s product development roadmap template . This template will help you plan, manage, and execute the roadmap for your new product.

Real-life example: HubSpot

Hubspot began in 2006 as a content and customer management platform for small businesses with one to 10 employees. By 2008, they had 600 customers.

As time went on, they adapted to the marketplace and created new features. This allowed them to diversify, creating an entirely new product for a new audience — a CRM for enterprise-level businesses.

Today, they are an all-in-one CRM platform with 121,000 global customers . It’s safe to say their diversification efforts paid off.

• Start using the Ansoff Matrix today with Miro

By now, you should have a pretty solid understanding of how to use the Ansoff Matrix for strategic planning. You know what each quadrant means and how to use them, and you’ve got some real-life examples to inspire you.

If you want to get started, take a look at our Ansoff Matrix template . With functionalities like sticky notes, pen tools, and shapes, you can use it to map out your strategic ideas in a visual, easy-to-understand way.

Miro is also a great tool for cross-functional collaboration, allowing teams to communicate and work together from one central platform. If you’ve got a remote team, using our platform is a pretty handy way to keep collaboration smooth and efficient.

Keep your business growing and scaling — try our Ansoff Matrix Template .

Miro is your team's visual platform to connect, collaborate, and create — together..

Join millions of users that collaborate from all over the planet using Miro.

Keep reading

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• Strategic Framework: Abell’s Framework for Strategic Planning

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In this article, we will look at 1) what is the Abell Matrix? , 2) understanding the matrix , 3) how to apply Abell’s framework to your business , and 3) an example .

WHAT IS THE ABELL MATRIX?

The Abell matrix is a three dimensional tool most often is referred to as the three dimensional business definition model. The model is used to analyze the scope of operation for a business. This may include areas such as the technologies and products a business operates in a market or the audience that it targets. A detailed analysis of the business’s current activities can help create strategies for the future that will help the business stay tuned to the changes that may occur within the market.

The three dimensions of the business are the customer groups (who will be served by the business), customer needs (what are the customer needs that will be met) and technology or distinctive competencies (how are these needs going to be met). A major point of importance in this matrix is to focus on understanding the customer rather than the industry and its products and services. Through these three dimensions, this tool helps define a business by its competitive scope (narrow or broad) and the extent of competitive differentiation of its products/services.

UNDERSTANDING THE MATRIX

Abell described the strategic planning process as the starting principle for an organization’s business. This process in turn is driven by the mission statement which provides direction, focus and the basis for strategies to be further elaborated and driven down. Abell used three key questions as the three dimensions on his model and these are the foundation for the formulation of the mission statement itself.

• What are the customers of the organization?
• How can the organization meet the needs of its customers?
• What techniques are employed by the organization to meet these customer needs?

When plotted on a three dimensional model, the horizontal axis is taken as the customer groups, the vertical axis as their buying needs and the inclined axis is taken as the applied technologies. Taken together, a summarized version of the organization’s business model can be viewed in one glance.

This overview helps provide the company with a quick glance at the factors most important to the development of a marketing concept. The framework can be optimized by sorting the different factors that make up all three dimensions by their relative importance for the company. The most important factors should be closest to the 0 axis and should be given the highest priority and will be immediately visible to the company.

The Three Dimensions

• Customer Needs: This leg of the model identifies and lists down all the customer needs that are relevant to the company in question. Customer needs are identified based on the product offering and a link is made to customer benefits. As an example, a software developer who has studied customer needs in relation to their product will respond by providing easy to install software packages and may provide other useful options such as an anti-virus, a software cleanup option as well as manuals and tech support.
• Technologies: Unlike the name suggests, the word technologies is taken here in a broader context to describe all those technologies that are used to create a product as well as put in on the market. Issues here include things as diverse as the marketing campaign being use or the way market research must be conducted. Taking our software example further, the manufacturer will used the latest technologies in the product itself as well as proving a helpdesk which provides the best possible and most relevant information.
• Customer Groups: There would be no market without customers purchasing products on offer. This is why marketing is all about the buyers. It is vital for every organization to understand how to segment the market and which segments to target in order to successfully sell a product to them. Once the market has been segmented, the company needs to work toward acquiring as much knowledge as possible about the different target groups and offer specific products or campaigns to these segments. Our software manufacturer may choose to serve both business and customers and will need a separate strategy and account managers for its B2B and B2C lines of business.

Famous for his business definition model, Dr. Derek F Abell is the Professor Emeritus and co-founder of the European School of Management and Technology, established in Berlin, Germany. In 2012, he was also appointed the international dean at HSM Eduacao in Sao Paulo, Brazil. His work has been published as books and academic journal articles. He writes about strategic marketing, general management, leadership and executive responsibilities.

Dr. Abell obtained a bachelor’s degree in aeronautical engineering from the University of Southampton in 1960 before moving to the United Stated and pursuing a master’s degree in Industrial Management from MIT’s Sloan School of Management in 1966. He followed this with a doctorate in business administration from the Harvard Business School in 1970. He then served as the full time member of the Harvard Business School faculty until 1981. His other academic positions have included Insead in France and International Institute of Management Development in Switzerland among others.

Limitations

There is a strict marketing emphasis within the Abell model, which limits the framework from being widely used and as a key approach used to define competitive strategies for a business. In addition, there is no room to accommodate external factors such as governments and other regulating bodies. The three dimensional model also makes the analysis more complex than a two dimensional one. There is only a provision for abstract growth directions and the model does not provide support to determine the appropriate size and scale of the business.

Tools for Building the Model

Given the relative complexity of this model because of the three dimensions, users may find is easy to access one of the many available tools to help build their own framework. One of these is:

• Abell Model Creator Free

HOW TO APPLY ABELL’S FRAMEWORK TO YOUR BUSINESS

Practical use tips.

To begin implementing this model, it is first important to understand the dimensions and the entire model space. The three-dimensional space of the cube is the business scope of the company. The model helps identify what the company has been doing and also helps create a conceptual framework to identify opportunities for the future. Some key questions to help create this model for your company include:

• What are the current customer groups/Segments that we are serving?
• What needs are we meeting for these customers?
• What features or uses of our products are fulfilling these needs?
• Are there new customer groups with similar needs that are not being served?
• Can there be other uses of the product to fulfill other needs?
• Are there other technologies that need to be utilized to serve the needs of existing customers?

Reflecting on the Three Dimensions

The matrix is built to question the business model along three dimensions

• Here, the idea is to completely identify and understand customer profiles of those segments being served. Once the segments are identified, work can be done to retain the segments that are most relevant. Segments can be individual customers, business customers, geographical location, sedentary or nomadic, role in the industry, social professional category, purchasing power or level of education among others.
• In this dimension, the objective is to identify the needs of the consumer that are met by the product. This is done by identifying and characterizing the solution (the product or service) in terms of its features that it brings to the customer segments identified in the “who” category. These features may include improved effectiveness or efficiency, better risk management, greater well-being among others.
• At this stage, those means are identified and characterized through which the highlighted features are manufactured and delivered to customers. These means or technology include manufacturing techniques such as a choice of technical processes or a specific form of organization, distribution techniques such as home delivery, retailers, wholesalers, and large distribution and provision technologies such as user license, remote operation among others.

Applications

The matrix can be used in a number of ways by an organization. Some of these uses include:

• Defining the business scope at three business levels including the corporate level, the business level and the lower organizational levels
• Describing and communicating changes in the business definition. These changes may usually be a result of the company’s offering moving through the product life cycle
• Describing and communicating the business of any competitors in the market. This definition can be extremely helpful to the organization to better understand who they are up against
• Analyzing the growth opportunities for a business in a systematic and organized way which can help keep a track of these and implement at the right times
• Describing and communicating the evolution of markets

Starting a Car Dealership

Whether starting a new business or evaluating an existing one, the Abell business definition framework is a useful tool for stating out all the relevant information in an easy to assess format. In this example, we will consider what would need to be considered if you set out to start a car dealership.

The three dimensions of the framework will need to be identified and listed down, beginning with an understanding of who the customer is, moving on to what need are we trying to meet for one or more distinct customer groups and finally the means needed by the company to manufacture and deliver the product to customers.

The first question to ask is who will the business be serving? Businesses may choose to serve one or two segments of the potential target market or a larger group of segments. It is important to correctly identify who you are serving as information is vital to ensure that the right need is met in the right way. Often, a variation of the product or a different marketing strategy is used to target various segments. Once the segments are identified. It is vital to dig deep and understand the dynamics of each segment and what motivates them to make purchase decisions. For a car dealership, some segment options include:

• The rich and powerful executive
• The working class hero
• The urban party goer
• The suburban family

Once the segment has been identified, it is part of the study of this segment or segments to understand what need is motivating these people to make a particular purchase decisions. Some needs may be obvious as in the case of basic food items. While other needs may be unrecognized or unstated by the segment and need to be understood through research by the company. In the case of a car dealership, the need is vague and less obvious. If everyone wanted to buy a car to just meet the need to get from point A to point B, then the least expensive cars would be the ones everyone moved towards. Instead, some other reasons for buying a car may include:

• Peer pressure
• Status in an existing or aspirational peer group
• Masculinity
• Peace of mind and safety
• Excellent driving experience

Some questions that a customer may ask themselves when buying a car may be among the following depending on their hidden desire.

• Is it efficient and cost effective?
• Is it fast and sporty?
• Is it bold and strong?
• Is it comfortable and luxurious?
• Is it spacious and reliable?

To put this into perspective, if you picked the working class hero segment to target, their obvious needs may be to get from point A to point B, the ability to off-road if needed and have the space to carry a lot of friends, tools or other items easily. Some of the less obvious needs or hidden desires may include the need to be seen as strong, honest and courageous instead of a wimp, not be seen as putting on airs or being posh and seen as a loyal, outgoing and manly man.

By now you know that this segment requires cars that are powerful with big wheels, bold and spacious but not too fancy or expensive. Depending on the purchase power, the prime cars to sell would be muscle cars or pick-up trucks. As a dealer, your technology will be the systems needed to acquire these cars and market them in the right way, at the right time to the right people.

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Matrix Organization

What is a matrix organization.

How do Matrix Orga­ni­za­tions work?

Types of Matrix Management

Weak matrix.

Bal­anced Matrix

Strong Matrix

Advan­tages of the Matrix Orga­ni­za­tion Structure

• Resource opti­miza­tion: Enables seam­less shar­ing of assets across mul­ti­ple projects.
• Skill Devel­op­ment: Employ­ees gain project expe­ri­ence that fos­ters pro­fes­sion­al development.
• Agili­ty and respon­sive­ness: Main­tains the orga­ni­za­tion’s com­pet­i­tive edge by adapt­ing to rapid­ly chang­ing mar­ket conditions.
• Cross-func­tion­al col­lab­o­ra­tion: Work­ing across tra­di­tion­al bound­aries pro­motes a col­lab­o­ra­tive and inno­v­a­tive culture.
• Strate­gic deci­sion-mak­ing: Dual report­ing ensures deci­sions con­sid­er both func­tion­al exper­tise and project objectives.

Dis­ad­van­tages of the Matrix Orga­ni­za­tion Structure

• Ambi­gu­i­ty of author­i­ty: Over­lap­ping report­ing lines can obscure author­i­ty and cre­ate uncertainty.
• Resource com­pe­ti­tion: Func­tion­al depart­ments and project teams may be com­pet­ing for resources.
• Com­plex com­mu­ni­ca­tion needs: The com­plex struc­ture requires sophis­ti­cat­ed com­mu­ni­ca­tion to avoid get­ting misaligned.
• Slow­er deci­sion-mak­ing process­es: The shared gov­er­nance mod­el can result in lengthy con­sen­sus-build­ing efforts.
• Impact on Team Dynam­ics: Dual loy­al­ty can strain team cohe­sion and affect over­all morale. This under­scores the need for skilled lead­er­ship to main­tain a pos­i­tive matrix work environment.

Exam­ples of Matrix Org Structure

Exam­ple 1 : Tech­nol­o­gy and Soft­ware Development

Exam­ple 2 : health­care and pharmaceuticals, exam­ple 3 : man­u­fac­tur­ing and engineering, exam­ple 4 : con­sult­ing and pro­fes­sion­al services, exam­ple 5 : edu­ca­tion and non-prof­it organizations, improve the matrix struc­ture with project man­age­ment tools, 1 cen­tral­ized infor­ma­tion hub.

2  Enhanced Vis­i­bil­i­ty and Transparency

3  resource management.

4  Facil­i­tat­ing Collaboration

5  clear com­mu­ni­ca­tion channels.

With fea­tures designed to stream­line com­mu­ni­ca­tion, Work­sec­tion ensures that mes­sages reach the right peo­ple at the right time. This clar­i­ty is cru­cial in matrix struc­tures where employ­ees might receive con­flict­ing direc­tives from func­tion­al and project managers.

Con­clu­sion

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Quantitative Strategic Planning Matrix / QSPM: Theory and Template

Quantitative Strategic Planning Matrix: This article explains the Quantitative Strategic Planning Matrix (QSPM) in a practical way. Next to what it is, this article also highlights the Planning Process, the Elements and Interpretation of the QSPM, a Step-by-step plan for implementation and a Quantitative Strategic Planning Matrix template to get started. After reading it you will understand the basics of this powerful strategic management tool. Enjoy reading!

What is the Quantitative Strategic Planning Matrix (QSPM)?

The Quantitative Strategic Planning Matrix (QSPM) is a strategic management approach for top-level management. The method is also used to formulate the marketing strategy .

A QSPM is mainly used in evaluating different strategic options and determining the most attractive of the strategies at hand. The method shows the user which of the selected options is the most feasible and prioritizes it over other options.

Inherent in conducting such an analysis is conducting an analysis on a company’s internal and external environment (such as a SWOT analysis ). In addition, various studies are carried out, pros and cons are carefully evaluated and certain courses of action are decided.

Planning Process

The process of executing a QSPM consists of the three phases used for formulating strategies:

• Define strategic factors
• Strategic analysis i.e. a SWOT Analysis , measuring advantages and disadvantages of each option.
• Decision-making

Elements in the Quantitative Strategic Planning Matrix (QSPM)

The left column of the QSPM consists of the main external and internal factors.

These are determined in phase 1 of the formulation process. The input for this column can be obtained from the EFE / IFE matrix .

The top row of the matrix contains the feasible alternative strategies. These are determined in phase 2 of the process.

These are derived from, for example, the TOWS Matrix , BCG Matrix or SPACE Matrix .

Interpretation of the matrix

The Quantitative Strategic Planning Matrix determines the relative attractiveness of different options based on the degree to which internal and external critical success factors are used or improved.

This relative attractiveness is determined by determining the cumulative impact of each critical success factor.

An example of the use of a Quantitative Strategic Planning Matrix

The management of organization X has the ambition to grow the business significantly. To do so, they consider 3 options: expand by buying out competitors, improve sales through market and product development, or diversify.

A selection may include issuing shares or selling a division to raise capital. These alternatives options are completely different and the Quantitative Strategic Planning Matrix helps determine the attractiveness of these sets.

Strategic Planning: Business Strategy using Ancient Mapping    More information

Step-by-step plan for implementing the QSPM

The six steps that must be followed to develop a QSPM are explained below.

1. Enumeration

The first step involves making a list of all of an organization’s external opportunities and threats. These are positioned in the leftmost column. Then, add all internal strengths and weaknesses to the same column. The information listed here should come directly from the EFE/IFE Matrix.

A minimum of 10 external factors and 10 internal factors must be included in the QSPM.

2. Weighted Score

Assign a weight to each of the important internal and external factors. The weight of each aspect should be the same as those used in the EFE / IFE Matrix .

The weight of each aspect is recorded in the column immediately to the right of the first left column.

3. Identify Alternative Options

The third step involves examining the alternative strategies an organization should consider. These strategies are included in the top row of the QSPM. Group the options in a clear way.

4. Determine Attractiveness Scores (AS)

In the fourth step, the attractiveness scores should be defined as numerical values. Attractiveness scores are determined by examining each factor one at a time.

The same question is always asked: does this factor influence the choice of which strategy to choose?

Attractiveness scores are added to indicate the relative attractiveness of a strategy relative to another strategy.

The different values used are: 0. Not relevant 1. Not attractive 2. Somewhat attractive 3. Fairly attractive 4. Very attractive

If the factor has no impact or effect on the choice made, do not rate the element. Then calculate the Total Attractiveness Scores (TAS).

This score is shown at the very bottom of the matrix. The total scores indicate the relative attractiveness of each option. The higher the TAS, the more attractive the alternative is.

Develop the QSPM in a team

Developing the Quantitative Strategic Planning Matrix requires making a number of subjective decisions and assessments.

It is therefore advisable to do this together with other experts. This increases the chance that the decisions made are ultimately the best for the organization.

The fact that subjectivity is part of the process is also the main focus of critics of this technique. Ongoing discussion and potential conflicts may lead to different interpretations of the data.

The assessment of attractiveness scores requires intuitive decisions, even if they are based on objective information generated by the EFE / IFE Matrix analysis.

Quantitative Strategic Planning Matrix Summary

The QSPM is an effective method for exploring and choosing different strategic options. The method is usually applied by the senior management of a company, for example by management of the marketing team.

The QSPM cannot be performed without using a SWOT analysis and IFE / EFE Matrix . The results of these analyses serve as input for the Matrix.

The left column of the matrix lists the most important internal and external factors that say something about the attractiveness of the various alternatives. These alternatives are listed in the top row.

A weighted score is assigned to these factors. The higher the weighted score, the more important this factor.

Partly due to the subjective estimation of the attractiveness score for the alternatives, it is advisable to apply the technique in a group setting. This increases the chance that the decisions taken will ultimately be in favor of the organization.

Quantitative Strategic Planning Matrix template

To set-up a QSPM, you can use this ready-to-use QSPM template / worksheet in a .DOC format.

Download the Quantitative Strategic Planning Matrix template

It’s Your Turn

What do you think? Do you recognize the explanation about the Quantitative Strategic Planning Matrix (QSPM)? Are there other methods and techniques that you think could be used in combination with the QSPM? When did you have to weigh different alternatives against each other? Did you use this method at the time? Do you have any tips or comments?

Share your experience and knowledge in the comments box below.

More information

• David, M. E., David, F. R., & David, F. R. (2017). The quantitative strategic planning matrix: a new marketing tool . Journal of strategic Marketing, 25(4), 342-352.
• David, M. E., David, F. R., & David, F. R. (2009). The Quantitative Strategic Planning Matrix (QSPM) applied to a retail computer store . The Coastal Business Journal, 8(1), 42-52.
• David, F. R. (1986). The strategic planning matrix—a quantitative approach . Long Range Planning, 19(5), 102-107.
• Garthinda, D., & Aldianto, L. (2012). Business strategy recommendation for warung lepak restaurant using quantitative strategic planning matrix (QSPM) . Indonesian Journal of Business Administration, 1(3), 66289.

How to cite this article: Janse, B. (2022). Quantitative Strategic Planning Matrix (QSPM) . Retrieved [insert date] from Toolshero: https://www.toolshero.com/strategy/quantitative-strategic-planning-matrix/

Original publication date: 03/17/2022 | Last update: 12/20/2023

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Ben Janse is a young professional working at ToolsHero as Content Manager. He is also an International Business student at Rotterdam Business School where he focusses on analyzing and developing management models. Thanks to his theoretical and practical knowledge, he knows how to distinguish main- and side issues and to make the essence of each article clearly visible.

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GE McKinsey Matrix: A Multifactorial Portfolio Analysis in Corporate Strategy

The GE-McKinsey Matrix (a.k.a. GE Matrix, General Electric Matrix, Nine-box matrix) is just like the BCG Matrix a portfolio analysis tool used in corporate strategy  to analyse strategic business units or product lines based on two variables: industry attractiveness and the competitive strength of a business unit. By combining these two variables into a matrix, a corporation can plot their business units accordingly and determine where to invest, where to hold their position, and where to harvest or divest. However, different from the BCG Matrix, the GE-McKinsey Matrix uses multiple  factors that are combined to determine the measure of the two variables industry attractiveness and competitive strength. This is an important distinction, since the BCG Matrix has been criticized a lot on its use of only one single (and perhaps outdated) variable for each axis.

The name of the framework stems from the year 1970 in which General Electric (GE) hired the strategy consulting firm McKinsey&Company to consult GE in managing their large and complex portfolio of strategic business units. Therefore, it is McKinsey (not GE) that created the framework as a means to help GE cope with its strategic decisions on a corporate level. 

Figure 1: GE McKinsey Nine Box Matrix

Industry Attractiveness

On the vertical axis of the GE Mckinsey Matrix, we find the variable Industry Attractiveness which can be divided into High, Medium and Low. Industry attractiveness is demonstrated by how beneficial it is for a company to enter and compete within a certain industry based on the profit potential of that specific industry. The higher the profit potential of an industry is, the more attractive it becomes. An industry’s profitability in turn is affected by the current level of competition and potential future changes in the competitive landscape. When evaluating industry attractiveness, you should look at how an industry will change in the long run rather than in the near future, because the investments needed for a business usually require long lasting commitment. Industry attractiveness consists of many factors that collectively determine the level of competition and thus its profit potential. The most common factors to look at are:

• Industry size
• Long-run growth rate
• Industry structure (use Porter’s Five Forces or Structure-Conduct-Performance model)
• Industry life cycle (use Product Life Cycle )
• Macro environment (use PESTEL Analysis )
• Market segmentation

Competitive  Strength

On the horizontal axis we find the Competitive Strength of a business unit which can also be divided into High, Medium and Low. This variable measures how strong or competent a particular company is against its rivals: it is an indicator of its ability to compete within a certain industry. A company’s strengths are its characteristics that give it an advantage over others (competitions/rivals). These strengths are often referred to as unique selling points (USP’s), firm-specific advantages (FSA’s) or more widely known as sustainable competitive advantages. Apart from a company’s competitive position right now, it is also very important to look at how sustainable its position is in the long run. So where Industry Attractiveness is about the level of competition in the entire industry, Competitive Strength is about the (future) ability to compete of one single company within that specific industry. Competitive strength also consists of multiple factors that together make up a company’s total score. The most common factors to look at are: 

• Profitability
• Market share
• Business growth
• Brand equity
• Level of differentiation (use the Value Disciplines or Porter’s Generic Strategies )
• Firm resources (use the VRIO Framework )
• Efficiency and effectiveness of internal linkages (use the Value Chain Analysis )
• Customer loyalty (use the Net Promoter Score )

Figure 2: GE McKInsey Matrix Strategies

Strategic implications

Based on the 3 degrees (High, Medium and Low) of both Industry Attractiveness and Competitive Strength, the matrix can be crafted consisting of 9 different boxes with 9 different scenarios and corresponding strategic actions. The strategic actions to choose from are: Invest/Grow strategy, Selectivity/Earnings strategy (sometimes referred to as Hold strategy), and the Harvest/Divest strategy. 

Invest/Grow strategy

The best section for a company or business unit to be in is the Invest/Grow section. A company can reach this scenario if it is operating in a moderate to highly attractive industry while having a moderate to highly competitive position within that industry. In such a situation there is a massive potential for growth. However, in order to be able to grow, a company needs resources such as assets and capital. These investments are necessary to increase capacity, to reach new customers through more advertisements or to improve products through Research & Development. Companies can also choose to grow externally via Mergers & Acquisitions apart from growing organically. Again, a company will need investments in order to realize such an endavour. The most notable challenge for companies in these sections are resource constraints that block them from growing bigger and becoming/maintaining market leadership.

Selectivity/Earnings strategy

Companies or business units in the Selectivity/Earnings sections are a bit more tricky. They are either companies with a low to moderate competitive position in an attractive industry or companies with an extremely high competition position in a less attractive industry. Deciding on whether to invest or not to invest largely depends on the outlook that is expected of either the improvement in competitive position or the potential to shift to more interesting industries. These decisions have to be made very carefully, since you want to use most of the investments available to the companies in the Invest/Grow section. The “left-over” investments should be used for the companies in the Selectivity/Earnings section with the highest potential for improvements, while being monitored closely to measure its progress on the way.

Harvest/Divest strategy

Finally we are left with companies or business units that either have a low competitive position, are active in an unattractive industry or a combination of the two. These companies have no promising outlooks anymore and should not be invested in. Corporate strategists have two main options to consider: 1. They divest the business units by selling it to an interested buyer for a reasonable price. This also known as a carve-out. Selling the business unit to another player in the industry that has a better competitive position is not a strange idea at all. The buyer might have better competences to make it a success or they can create value by combining activities (synergies). The cash that results from selling the business unit can consequently be used in Invest/Grow business units elsewhere in the portfolio. 2. Or corporate strategists can choose a harvest strategy. This basically means that the business unit gets just enough investments (or non at all) to keep the business running, while reaping the few fruits that may be left. This is a very short-term perspective action that allows corporate strategists to subtract as much remaining cash as possible, but is likely to result in the liquidation of the business unit eventually.

GE McKinsey Matrix In Sum

The GE McKinsey Matrix is a good alternative for the BCG Matrix and has the advantage that the two variables used consist of multiple factors combined. It may be quite a task however to quantify factors such as brand equity and industry structure,F and combine them all into a single number that can be plotted on the nine-box matrix. For corporate strategist in portfolio management, the model functions as a great starting point to base investment decisions on.

Further Reading:

• McKinsey & Company (2008). Enduring Ideas: The GE–McKinsey Nine-box Matrix. McKinsey Quarterly.

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50 Business Diagrams for Strategic Planning

Business diagrams represent your business processes in a visual way. Also called business process mapping, these tools show the steps involved in your procedures. Used for anything from production processes to employee onboarding, business diagrams clearly map out everything involved in your operations.

Here are 50 such diagrams and templates that you can use.

Brainstorming

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What is an Affinity Diagram?

An affinity diagram is a visual tool used for organizing ideas or information generated during brainstorming sessions. It helps teams make sense of large amounts of unstructured information by grouping related ideas together and identifying patterns and themes.

When to Use

• Grouping and categorizing ideas.
• Making sense of complex information.
• Generating insights from a brainstorming session.
• Resolving issues collaboratively.
• Organizing unstructured data.
• Improving processes through team input.

How to Use the Affinity Diagram

• Gather ideas: Write down ideas or opinions related to a specific topic or problem on separate cards or sticky notes.
• Sort similar ones: Stick the notes on a board, moving similar ones close to each other.
• Label groups: Write a descriptive label or heading for each group that captures the overarching theme that ties those ideas together.
• Analyze and refine: Analyze the relationships and patterns that emerge.
• Discuss and prioritize: Discuss about the identified groups and their contents to develop strategies, solutions, or action plans based on them.

Additional Resources

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Decision Tree

What is a decision tree.

A decision tree template is a visual aid that helps you make decisions by breaking down a complex problem into smaller, more manageable steps. The template typically consists of a central node, which represents the main decision to be made, and branches that represent the possible outcomes of that decision. Each branch can then have its own sub-branches, representing the possible outcomes of the next decision, and so on.

When to Use:

• Evaluating possible outcomes and their probabilities.
• Quantifying risks and rewards.
• Structuring decision-making logically.
• Analyzing trade-offs and uncertainties.
• Communicating decision paths visually.

How to Use it in 4 Simple Steps

• Clearly outline the decision you need to make. Is it a business strategy, project path, or personal choice? It helps to lay the foundation for an effective decision-making process.
• List the viable options at hand. These are the potential branches of your decision tree, representing different pathways to consider.
• For each option, assess the potential outcomes and consequences. Use data, research, and expert insights to weigh the pros and cons, allowing you to make an informed choice.
• Once you’ve evaluated all options, follow the branches to their logical conclusions. The Decision Tree Template will lead you to the optimal choice, backed by an analysis of potential outcomes.
• 13 Decision-Making Techniques and Tools for Business
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What is a Mind Map?

A mind map is a visual representation of information that helps organize thoughts, ideas, concepts, or tasks around a central topic or theme. It typically starts with a central idea or keyword, which branches out into related subtopics, creating a tree-like structure. Each subtopic can further branch out into more specific details. Mind maps use keywords, images, colors, and connections to create a visually engaging overview of information.

• Brainstorming creatively.
• Planning projects or tasks.
• Visualizing relationships.
• Taking structured notes.
• Problem-solving collaboratively.

How to Create a Mind Map?

• Central idea: Start with a central keyword or topic in the middle of the page.
• Branches: Create main branches radiating from the central idea, each representing a key subtopic or category.
• Sub-branches: From each main branch, add smaller branches for more specific details or ideas related to the subtopic.
• Keywords and images: Use concise keywords and images on each branch to represent concepts. Keep text short and visual.
• Hierarchy: Arrange branches in a hierarchical manner, with main topics closer to the center and subtopics farther out.
• Connections: Draw lines or arrows to show connections between related branches, indicating relationships or dependencies.
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SCAMPER Template

What is a scamper template.

The SCAMPER template is a brainstorming tool that allows you to generate ideas and transform them into tangible solutions. Each letter in the acronym prompts a specific angle for idea generation:

Substitute : Identify elements that can be replaced to enhance the concept. Combine : Fuse different ideas to create something entirely new and exciting. Adapt : Modify aspects to suit a different context or purpose. Modify : Alter and refine components to boost functionality and appeal. Put to Another Use : Imagine alternate applications for existing concepts. Eliminate : Trim unnecessary elements to streamline and refine the idea. Reverse/Rearrange : Flip perspectives and arrangements for fresh insights.

• Generating new ideas or solutions.
• Overcoming creative blocks.
• Innovating existing concepts.
• Reframing problems for fresh perspectives.
• Enhancing products or processes.

How to Use the SCAMPER Template?

• Identify the concept or idea you want to explore. Frame it as a question or challenge.
• Apply the SCAMPER principles – Substitute, Combine, Adapt, Modify, Put to another use, Eliminate, and Reverse – to dissect your concept. This sparks inventive ideas by prompting you to view them from various angles.
• Engage with the generated ideas. Identify the most promising ones and refine them further. Combine different SCAMPER techniques for a synergy of creativity.
• Organize your ideas visually using the SCAMPER Map template. This clear overview of your innovative pathways helps you choose the best direction forward.
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Documentation

Business process modeling notation (bpmn), what is bpmn.

Business Process Modeling Notation (BPMN) is a standardized graphical notation used to visualize business processes in a clear and understandable way. It provides a visual representation of various aspects of a business process, including its activities, decisions, events, gateways, and flows, allowing organizations to model, analyze, and communicate their processes effectively.

• Documenting business processes.
• Representing workflow logic.
• Analyzing process efficiency.
• Standardizing process documentation.

How to Create a BPMN Diagram?

• Identify the process: Choose the specific business process you want to model.
• List process steps: Break down the process into individual steps, from start to finish.
• Draw the BPMN diagram: Using the correct notations, draw the BPMN diagram.
• Connect symbols: Use arrows to connect the symbols in the sequence they occur.
• Add information: Inside the symbols, add details like task names, who’s responsible, and any important data. This provides clarity and context.
• Use swimlanes: If different teams or roles are involved, use swimlanes to show responsibilities.
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Employee Journey Map

What is an employee journey mapp.

The employee journey map is a tool that helps visualize an employee’s progression within an organization, from hire to exit. It aims to add value to the employee by identifying his/her skills, areas of expertise and improvement to create growth opportunities accordingly. It gives employees a clear picture of what their journey will be like in the company.

In addition, the employee journey maps gauge employee satisfaction throughout important phases such as “Onboarding” to “Growth,” “Transitions,” and “Offboarding,” delving into their emotions, needs, and aspirations.

• Analyzing employee experiences.
• Visualizing the employee lifecycle.
• Identifying pain points and opportunities.
• Improving employee engagement.
• Mapping touchpoints and interactions.

How to Use the Employee Journey Map Template?

• Assemble key stakeholders to pool insights, ensuring a holistic perspective.
• Identify employee personas to empathize with distinct experiences.
• Plot employee interactions, pain points, and delights within each phase.
• Continuously refine by analyzing feedback, adapting strategies, and nurturing ongoing improvements.
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Organizational Chart

What is an organizational chart.

An organizational chart, also known as an org chart or hierarchy chart, is a visual representation of a company’s structure that highlights the relationships between different roles, positions, and departments within the organization.

• Showing reporting relationships.
• Illustrating departmental divisions.
• Understanding roles and positions.
• Onboarding new employees.
• Planning for growth or restructuring.

How to Create an Organizational Chart?

• Identify roles and departments: List all key roles and departments within the organization, from top-level executives to lower-level positions.
• Hierarchy arrangement: Determine the hierarchy of positions, including reporting relationships. Place higher-ranking roles at the top and follow down with subordinates..
• Chart format: Choose a suitable format, such as a hierarchical structure with boxes and lines, for your chart.
• Add positions: Use boxes for each role and connect them with lines to indicate reporting relationships. Align boxes to show hierarchy levels clearly.
• Position details: Include job titles, names (if applicable), and a brief description of each role within the boxes.
• Review and refine: Double-check the chart for accuracy, clarity, and alignment with the organization’s structure. Make adjustments as needed, ensuring the chart clearly reflects the current hierarchy and roles.

Service Blueprint

What is a service blueprint.

A service blueprint is a diagram that illustrates the end-to-end customer service experience, along with the internal processes, interactions, and touchpoints that support it. It provides a comprehensive view of how a service is delivered, highlighting the customer’s journey, the roles of various stakeholders, and the behind-the-scenes activities required to deliver the service effectively.

• Analyzing service delivery gaps.
• Enhancing service quality and efficiency.
• Enhancing customer experiences.
• Collaborating on service design.
• Designing or improving services.

How to Create a Service Blueprint?

• Define the service: Clearly identify the specific service you want to blueprint, specifying its scope and purpose.
• Map the customer journey: Outline the steps a customer takes when interacting with the service, including touchpoints and key actions.
• Identify internal processes: Map out the internal activities and processes that support each customer touchpoint, showing how the service is delivered behind the scenes.
• Add backstage & support processes: Show the backstage processes, such as employee training, resource allocation, quality control, etc. required to deliver the service.
• Validate and refine: Share the blueprint with stakeholders, including team members and customer representatives, to ensure its accuracy and gather feedback for refinement.
• Service Blueprint Template
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SIPOC Diagram

What is a sipoc diagram.

A SIPOC diagram is used in business process improvement to outline the high-level components of a process. The acronym SIPOC stands for Suppliers, Inputs, Process, Outputs, and Customers. Each element in the SIPOC diagram provides a clear overview of the process and its relationships to help teams understand and analyze a process in a structured manner.

• Defining process scope.
• Identifying key process elements.
• Communicating process overview.
• Analyzing process components.
• Streamlining process understanding.

How to Create a SIPOC Diagram?

• Define the process: Choose the specific process you want to map.
• Identify suppliers: List the entities or sources that provide essential inputs or resources to initiate the process.
• List inputs: Specify the materials, information, or resources required from the suppliers to start and execute the process.
• Outline the process: Define the key steps involved in the process, highlighting the sequence of actions.
• List outputs: Identify the end results or deliverables produced by the process, ensuring they meet the needs of the customers.
• Identify customers: Determine who receives the outputs and understand their requirements or expectations from the process.
• SIPOC Templates

Value Stream Map

What is a value stream map.

A value stream map (VSM) is a diagram that visualizes the entire process of how a product or service is produced or delivered, from the raw materials or inputs to the end customer. It provides a comprehensive overview of the flow of materials, information, and activities within a process or system. Value stream mapping is often used in Lean and Six Sigma methodologies to identify inefficiencies, eliminate waste, and optimize processes.

• Identifying bottlenecks and waste.
• Improving workflow and cycle time.
• Visualizing end-to-end processes.
• Streamlining operations.

How to Create a Value Stream Map?

• Select the process: Choose the process or system you want to map-production process, service delivery, etc..
• Gather information: Collect data on process steps, times, inventory, and metrics.
• Draw current map: Visualize the current process steps and flow using the value stream map symbols.
• Differentiate steps: Identify which steps add value and which don’t, marking non-value-adding ones.
• Map inventory & identify bottlenecks: Show where materials pile up and where work is in progress. Highlight parts causing slowdowns or problems.
• Calculate metrics: Add details like how long each step takes and how much time passes between steps.
• Draw the future state map : Create a future state map that depicts the improved process, incorporating changes and optimizations.
• Value Stream Mapping Software
• What is Value Stream Mapping?
• Value Stream Mapping Templates

Retrospective Meeting Template

What is a retrospective meeting.

A retrospective meeting template is a structured format used to conduct retrospective meetings, also known as “retros” or “post-mortems.” They are effective team gatherings held at the end of a project, sprint, or time period, where participants reflect on what went well, what could be improved, and how to improve future processes.

• Reviewing past project phases.
• Reflecting on team performance.
• Discussing lessons learned.
• Improving teamwork and processes.
• Planning actionable improvements.

How to Run a Retrospective Meeting?

• Set the stage: Begin by introducing the purpose of the retrospective and the context, such as the project, sprint, or time period being reviewed.
• Gather data: Collect information and metrics related to the project’s performance, including successes, challenges, and relevant user feedback.
• Review: Facilitate a discussion where team members share what went well and what didn’t go as planned, ensuring a balanced perspective.
• Brainstorm solutions: Encourage the team to brainstorm potential improvements and solutions for the identified challenges. Focus on actionable items that can be implemented in the future.
• Prioritize action items: Collaboratively prioritize the suggested solutions based on their impact and feasibility, selecting a few key action items for the team to work on.
• Retro Software
• The Ultimate Guide to Retrospectives
• Guide to Running Retrospectives Remotely
• Fun Retrospective Ideas for Hybrid Teams
• 10 Common Mistakes to Avoid During Retrospectives
• 54 Retrospective Questions

Project Management

Action plan, what is an action plan.

An action plan is a detailed document that outlines the specific steps, tasks, resources, timelines, and responsibilities required to achieve a particular goal or objective. It serves as a roadmap, guiding individuals or teams through the implementation of strategies, projects, or initiatives.

• Breaking down goals into steps.
• Tracking progress and completion.
• Organizing complex projects.
• Ensuring accountability.
• Facilitating effective execution.

How to Create an Action Plan?

• Set clear objectives: Clearly define the specific goal or objective you want to achieve. Make it measurable, achievable, relevant, and time-bound (SMART).
• Break it down: Divide the objective into smaller, manageable tasks or steps that contribute to the overall goal. These tasks should be clear and actionable.
• Assign responsibilities: Identify who is responsible for each task. Assign roles to individuals or teams based on their expertise and availability.
• Set timelines: Determine realistic deadlines for each task. Ensure the timeline aligns with the overall objective and consider any dependencies between tasks.
• Allocate resources: Identify the resources required to complete each task, such as personnel, budget, materials, or tools.
• How to Create an Action Plan
• Action Plan Examples
• Corrective Action Plan

Communications Plan

What is a communications plan.

A communications plan is a document that outlines how you will communicate with potential customers. It should include information about your goals for communication, target audience, key messages, timeline of communications, communications budget, channels that you will use to communicate and KPIs to measure success of your communications.

• Launching a new product or service.
• Managing project or campaign communication.
• Defining target audiences and stakeholders.
• Outlining communication objectives and goals.
• Establishing timelines and responsibilities.
• Aligning communication efforts with strategy.

How to Use the Communications Plan?

• Clearly mention your goals. Whether it’s brand promotion, event awareness, or crisis management, this sets the tone.
• Understand your audience. What drives them? How can your message create impact?
• Craft messages that caters to each audience segment. Choose the optimal channels for maximum reach and engagement.
• Set a realistic timeline, coordinate teams, and execute with precision.
• How to Write a Communication Plan in 6 Steps
• Lessons Learned Template

What is the Lessons Learned Template?

A lessons learned template is a document that helps project teams document the knowledge obtained from executing a project. It includes both positive and negative experiences that occurred throughout the project. The template typically covers the following topics: what went well, what went wrong, what could have been done better, and any valuable lessons that can be taken away.

• Capturing successes and challenges.
• Identifying what went well and what didn’t.
• Documenting best practices and pitfalls.
• Improving future project planning.
• Sharing knowledge within the organization.

How to Use the Lessons Learned Template?

• Engage stakeholders in candid post-project assessments. Encourage open dialogue about successes, failures, and unexpected outcomes. Gather perspectives from all involved parties.
• Organize findings into concise categories. Articulate key takeaways, emphasizing actionable insights. Craft a narrative that not only acknowledges challenges but transforms them into opportunities.
• Integrate lessons into future plans. Align new initiatives with these insights to ensure history informs future action. Encourage a culture that embraces learning and growth.
• Regular Reassessment: Periodically revisit the template. As landscapes evolve, so does wisdom. Continuously refine the template to remain relevant and potent.
• How to Use Lessons Learned Effectively to Avoid Project Failure
• Key Project Documents Every Project Manager Needs

Research & Analysis

Cause and effect diagram, what is a cause and effect diagram.

A cause and effect diagram, also known as a fishbone diagram or Ishikawa diagram, is a visual tool used to analyze and identify the potential causes of a specific problem or effect. The diagram takes its name from its shape, which resembles the skeleton of a fish. It is a structured way to brainstorm and organize the various factors that could contribute to an issue, making it easier to understand the root causes.

• Investigating complex problems.
• Engaging team collaboration.
• Analyzing process inefficiencies.
• Solving quality-related issues.
• Visualizing cause-effect relationships.

How to Use the Cause and Effect Diagram?

• Define the problem: Clearly identify the problem or effect you want to analyze. Write it down at the head of the diagram.
• Identify categories: Determine the main categories of factors that could contribute to the problem.
• Brainstorm potential causes: Brainstorm possible factors and sub-causes that might be causing the problem. Write these factors as smaller lines branching off from the respective categories.
• Analyze and evaluate: Discuss each potential cause and its relevance to the problem.
• Identify root causes: Look for causes that have a significant impact and are likely to be central to the problem. These are your potential root causes.
• Prioritize and verify: Prioritize the most likely root causes and verify them through data analysis, observations, or further investigation.
• Fishbone Diagram Maker
• Fishbone Diagram Templates
• The Ultimate Guide to Fishbone Diagrams
• How to Use Cause and Effect Analysis

Competitor Analysis

What is a competitive analysis.

A competitive analysis, also known as a competitor analysis, is a strategic assessment process used by businesses to evaluate and understand the strengths and weaknesses of their competitors within the same industry or market segment. It involves gathering information about the products, services, marketing strategies, financial performance, and overall positioning of rival companies.

• Understanding market dynamics.
• Developing competitive strategies.
• Benchmarking against rivals.
• Making informed business decisions.
• Planning for market differentiation.

How to Do a Competitive Analysis?

• Identify competitors: List direct and indirect competitors operating in the same market or industry.
• Gather information: Collect data on competitors' products, services, pricing, distribution, marketing, and customer feedback.
• Analyze SWOT: Evaluate each competitor’s strengths, weaknesses, opportunities, and threats to identify areas of advantage and vulnerability.
• Compare offerings: Compare your offerings to competitors', highlighting differences and potential unique selling points.
• Market positioning: Determine where competitors stand in terms of market share, reputation, and customer perception.
• Strategic insights: Based on the analysis, develop strategies to capitalize on competitors' weaknesses, differentiate your offerings, and position your business effectively.
• How to do a Competitive Analysis

Customer Journey Map

What is a customer journey map.

A customer journey map is a visual tool that businesses use to understand the complete experience a customer goes through when dealing with them. It shows the various steps, interactions, and emotions the customer encounters from first learning about the business to becoming a loyal customer.

• Visualizing touchpoints and interactions.
• Identifying pain points and gaps.
• Improving customer satisfaction.
• Designing better user experiences.
• Enhancing product/service delivery.

How to Create a Customer Journey Map?

• Define customer persona: Start by understanding your typical customer. Define a detailed customer persona, including demographics, preferences, goals, etc.
• Identify customer touch points: List all the interactions or touchpoints a customer has with your business.
• Map stages: Divide the customer’s journey into key stages, such as Awareness, Consideration, Purchase, Use, and Advocacy.
• Plot emotions and actions: For each stage and touchpoint, map out the customer’s emotional state, actions, goals, and pain points.
• Analyze and improve: Identify areas where the customer experience can be improved. Develop solutions to improve the overall journey.
• Customer Journey Map Templates
• Learn How to Create Customer Journey Maps
• Customer Journey Map Tool

Empathy Map

What is an empathy map.

An empathy map is a visual tool that helps teams gain a better understanding of their users. It is divided into four quadrants: Says, Does, Thinks, and Feels. The Says quadrant captures what the user says. The Does quadrant captures what the user does, both physically and digitally. The Thinks quadrant captures what the user is thinking. The Feels quadrant captures how the user is feeling, both emotionally and physically.

• Understanding user or customer perspectives.
• Developing user-centered products or services.
• Identifying pain points and needs.
• Creating targeted marketing strategies.

How to Use the Empathy Map Template?

• Assemble a diverse team to bring different perspectives to the table.
• Select a specific persona or target group to empathize with.
• Engage in thoughtful discussions and research to populate each quadrant.
• Identify patterns and revelations to illuminate new avenues for innovation.
• How to Visualize A Customer-Centric Strategy
• The Ultimate List Of Visual User Research Methods
• Empathy Map Template .

Force Field Analysis

What is a force field analysis.

A force field analysis is a decision-making and problem-solving technique used to assess the driving and restraining forces that influence a proposed change or decision within an organization or situation. It was developed by Kurt Lewin, a social psychologist.

• Assessing change or decision impact.
• Planning change management strategies.
• Gaining insights into resistance and support.
• Facilitating informed decision-making.

How to Do a Force Field Analysis?

• Define the change: Clearly define the change or decision you’re analyzing, and articulate its goals and expected outcomes.
• Identify driving forces: List all factors that encourage or support the change. These could be market trends, customer demands, competitive pressures, etc.
• Identify restraining forces: List factors that oppose the change, such as resistance from employees, financial constraints, cultural barriers, etc.
• Assign weight and score: Give a numerical value or score to each force to represent its strength or influence, typically on a scale of 1 to 5
• Visualize the forces: Create a visual representation with arrows indicating the direction and strength of each force. Driving forces push for change, while restraining forces counteract it.
• Analyze and decide: Assess the balance between driving and restraining forces. Develop strategies to enhance driving forces, address restraining forces, or find ways to minimize their impact to ensure successful change implementation.
• Force Field Analysis Templates
• Guide to Understanding the Force Field Analysis
• Change Management Tools to Drive Change

User Persona Diagram

What is a user persona diagram.

A user persona diagram is a fictional representation of a specific type of user or customer that a product or service is designed for. User personas encompass various characteristics, behaviors, goals, needs, and preferences of a typical user within a specific demographic or user group.

• Understanding user behaviors.
• Identifying user needs and goals.
• Designing user-centered products/services.
• Guiding product development decisions.
• Personalizing marketing strategies.
• Improving user experience.

How to Create a User Persona?

• Gather data: Collect insights from user research, surveys, interviews, and analytics to understand user behaviors, preferences, needs, and goals.
• Identify patterns: Analyze the collected data to identify common trends, behaviors, and pain points among users, and group them based on shared characteristics.
• Segmentation: Create distinct user segments, each representing a specific group with similar demographics, behaviors, and objectives.
• Create the user persona: Develop personas for each user segment by giving them a name, photo, and detailed attributes, including job role, age, goals, challenges, etc.
• User Persona Creator
• How to Create a Buyer Persona
• UX Research Methods
• Visual User Research Methods
• UX Research Plan

Strategy & Planning

What is adl matrix.

The ADL matrix is a tool that can be used to understand the life cycle of an industry (from growth to decline) and then compare it with the market position, which helps businesses manage their portfolio.. The ADL matrix helps businesses to make critical decisions,by providing insights on where to invest, what strategies to employ and how to stay ahead of the competition.

• Analyzing business portfolio.
• Evaluating strategic business units (SBUs).
• Assessing market growth and relative market share.
• Making resource allocation decisions.
• Developing growth strategies.

How to Use This Template?

• Compile data on market trends and competitive forces to rate Industry Attractiveness and Competitive Advantage on a scale.
• Plot your business units, products, or services on the matrix based on their scores in the two dimensions.
• Identify growth opportunities by pinpointing segments where Industry Attractiveness surpasses Competitive Advantage, prompting innovation or partnerships.
• Make informed resource allocation decisions by focusing efforts where your Competitive Advantage aligns with Industry Attractiveness.

What is the AIDA Model?

The AIDA (Attention, Interest, Desire and Action) model explains the four phases that a consumer goes through, before making a purchase decision. This framework helps content marketers better understand their target audience and create persuasive content that helps grab attention to their products, sparks interest, create a desire to attain them and ultimately drive action to purchase.

• Creating marketing or advertising content.
• Guiding customer engagement.
• Designing persuasive communication.
• Building awareness of a product or service.

How to Use the AIDA Model?

• Grab your audience’s focus with a powerful hook. Pose a question, share a startling statistic, or craft a compelling headline that stops them in their tracks.
• Once you have their attention, unveil a problem they can relate to, and then offer a solution that captivates their interest. Showcase benefits and unique selling points to keep them engaged.
• Present the value of your product or idea. Appeal to emotions, show how it fulfills their needs, and paint a vivid picture of the positive outcomes it brings.
• Seal the deal with a clear and compelling call to action. Whether it’s to buy, sign up, or simply learn more, guide your audience towards the next steps they need to take.
• How to Develop and Effective Marketing Mix

Ansoff Matrix

What is an ansoff matrix.

The Ansoff matrix, also known as the Ansoff Growth Matrix, is a strategic framework used to analyze and plan business growth strategies. The Ansoff matrix presents four growth strategies: Market Penetration (increasing sales in current markets), Market Development (entering new markets with existing products), Product Development (introducing new products to current markets), and Diversification (launching new products in new markets).

• Expanding product lines or offerings.
• Identifying strategic directions.
• Assessing risk and potential rewards.
• Making informed expansion decisions.

How to Use the Ansoff Matrix?

• Define your objective: Clearly state your growth goal, such as increasing market share, expanding into new markets, launching new products, or diversifying your business.
• Assess your current position: Understand your current products, target markets, and competitive landscape. Identify where you are on the matrix (existing products/markets or new products/markets).
• Choose the relevant strategy: Select the growth strategy that aligns with your objective and current position.
• Develop an action plan: Create a detailed plan for implementing the chosen strategy. Specify the tactics, resources, and timeline required to execute the plan effectively.
• Monitor and adjust: Continuously track the progress of your chosen strategy, analyzing the results against your objective.
• Ansoff Matrix Examples
• Marketing Strategy Planning Tools

What is the BCG Matrix?

Devised by Boston Consulting Group, this matrix helps categorize your products or services and make informed decisions about resource allocation. The categorization is done based on four quadrants.

• Cash cows: Products with a high market share in a low-growth market. They generate a lot of cash, but they don’t require a lot of investment.
• Dogs: Products with a low market share in a low-growth market. They are not profitable and may be candidates for divestment.
• Stars: Products with a high market share in a high-growth market. They require a lot of investment, but have the potential to be very profitable.
• Question marks: Products with a low market share in a high-growth market. They are not yet profitable, but they have the potential to become stars if they receive enough investment.
• Analyzing a business’s product portfolio.
• Evaluating market growth and market share.
• Identifying strategic priorities for different products.
• Developing growth and divestment strategies.
• Planning for future product development.

How to Use the BCG Matrix?

• Gather data on market growth rate and relative market share for each product.
• Position products on the matrix based on their growth and share values.
• Identify Stars for growth investment, Cash Cows for steady income generation, Question Marks for potential, and Dogs for reassessment.
• Devise strategies tailored to each quadrant. Nurture Stars, optimize Cash Cows, decide on Question Marks' fate, and consider divestment or revitalization for Dogs.
• The Ultimate List of Marketing Strategy Planning Tools
• BCG Matrix Template
• Business Capability Map

What is a Business Capability Map?

A business capability map provides a snapshot of a business’s inner workings. It captures the fundamental abilities, processes, technologies, and resources that facilitate your operations. This framework serves as a strategic tool, enabling leaders, managers, and stakeholders to align their vision, make informed decisions, and drive growth.

• Analyzing an organization’s core capabilities.
• Identifying strengths and weaknesses within operations.
• Planning for growth or transformation.
• Improving resource allocation decisions.
• Communicating complex business structures clearly.

How to Use the Business Capability Map?

• Identify and document key capabilities across departments. What sets you apart? What’s your secret sauce?
• Visualize the relationships between capabilities, revealing insights that fuel innovation and synergies.
• Map current and future states. Chart your growth path, highlighting gaps and opportunities for investment and improvement.
• With a clear map, empower your teams to deliver results, aligning efforts with overarching objectives.

What is a Business Model Canvas?

The Business Model Canvas is a strategic tool that provides a structured framework for developing, describing, and analyzing a business model. The canvas consists of nine key blocks that cover the essential aspects of a business: customer segments, value propositions, channels, customer relationships, revenue streams, key resources, key activities, key partnerships, and cost structure.

• Communicating business concepts succinctly.
• Developing or refining a business idea.
• Designing a new business model.

How to Use the Business Model Canvas?

• Start with a clear focus: Begin by identifying a specific business or project for which you want to design or analyze the business model. Define the purpose, objectives, and scope of the canvas.
• Fill in each block: Work through each of the nine blocks of the canvas, filling in the details related to your business or project.
• Visualize the interactions: Focus on how each block interacts with the others.
• Identify gaps and opportunities: Evaluate your canvas to identify areas of strength, weaknesses, gaps, or opportunities. Look for potential innovations, cost-saving measures, and ways to improve value delivery to customers.
• Communicate and collaborate: Use the canvas as a visual communication tool within your team, with stakeholders, or when seeking investments or partnerships.
• Business Model Canvas Template
• What is a Business Model Canvas

Impact Effort Matrix

What is an impact effort matrix.

The Impact Effort Matrix helps you to discover high-impact opportunities by evaluating tasks or ideas based on their potential impact and required effort. It helps guide your business decisions with clarity and precision. Whether you’re a leader, project manager, or an individual aiming to maximize efficiency, this template empowers you to prioritize wisely. Use the impact effort matrix to channel resources efficiently, and align efforts towards achieving organizational goals.

• Assessing potential initiatives based on impact and effort.
• Making decisions on resource allocation.
• Identifying quick wins and high-impact opportunities.
• Focusing on projects that deliver the most value.

How to Use the Impact Effort Matrix?

• List your projects on the horizontal axis, from game-changing innovations to routine tasks.
• Vertically, gauge the potential impact of each project – high, medium, or low.
• Assign an effort level to each project – simple, moderate, or complex.
• Plot your projects on the matrix. Instantly, you’ll see the high-impact, low-effort gems, and the complex tasks that might demand more resources.
• Impact Effort Matrix Template
• Visual Guide to Feature Prioritization

Lean Canvas

What is the lean canvas template.

The Lean Canvas template is a business planning tool that helps entrepreneurs visualize and test business ideas. It is divided into nine sections, including problem, solution, key metrics, and cost structure. The Lean Canvas template can be used to validate assumptions, identify risks, and iterate on your business model. Here are the nine sections of the Lean Canvas template:

• Problem: What problem are you solving?
• Solution: How are you solving the problem?
• Customer Segments: Who are your target customers?
• Channels: How will you reach your customers?
• Customer Relationships: How will you interact with your customers?
• Revenue Streams: How will you make money?
• Key Activities: What are the most important things you need to do to run your business?
• Key Resources: What resources do you need to succeed?
• Key Partnerships: Who can help you achieve your goals?
• Developing a new business idea.
• Evaluating a business model quickly.
• Testing assumptions and hypotheses.
• Focusing on problem-solving and solutions.
• Iterating and adapting the business concept.

How to Use the Lean Canvas Template?

• Start by clearly defining the problem you’re addressing. What pain point are you solving?
• Articulate your solution succinctly. How does your product/service resolve the identified problem?
• Identify your ideal customers. Who will benefit most from your solution?
• Outline how your business generates income. What pricing model works best for your solution?
• Top 6 Methods of Innovation to Come up with Unique Product Ideas

OKR Goal Setting Template

What is an okr goal setting template.

The OKR goal setting template is a framework for setting and tracking goals. It stands for Objectives and Key Results. Objectives are ambitious but achievable. They should be specific, measurable, attainable, relevant, and time-bound. Key Results are measurable steps that will help you achieve your objectives. They should be specific, quantifiable, and trackable.

OKRs are set quarterly. This allows teams to regularly review and adjust their goals.

OKRs are transparent. Everyone in the organization should know what the goals are and how they are being measured.

• Setting and tracking goals.
• Measure the success of new projects and initiatives.
• Performance measurement.

How to Use it?

• Outline specific and achievable objectives.
• Set measurable key results that reflect tangible milestones towards your objectives.
• Assign responsibilities for each key result, ensuring a clear chain of accountability.
• Consistently track your progress and adapt your OKRs as needed.
• OKR Template
• The Easy Guide to the Goal Setting Process

Operating Model Canvas

What is an operating model canvas.

The Operating Model Canvas - developed by Andrew Campbell, Mikel Gutierrez, and Mark Lancelott - is a visualization of how your business delivers value to customers. It is also a representation of how an organization operates. The operating model canvas template includes the following components:

• Processes – the work that should be done to deliver the value proposition
• Organization – how the people who are responsible to do the work is organized
• Locations – where the work is done (what buildings and assets are needed in these locations)
• Information – what information is needed to get the work done
• Suppliers – who provides inputs to the work and stakeholder relationships
• Management systems – Processes that are used to manage business operations such as planning, budgeting, etc.
• Designing or refining an organization’s operating model.
• Identifying areas for improvement and innovation.
• Aligning business operations with strategic goals.
• Communicating the organization’s structure and operations.

How to Use the Operating Model Canvas?

• Assemble your team. Collaborate to discover insights and perspectives on each of the above components.
• Brainstorm with your team members and gather their feedback to refine your understanding.
• Pivot, iterate, and uncover opportunities. The Canvas allows you to test, learn, and evolve, ensuring your business stands strong in any market.
• Revisit the Canvas as you grow, adapting to shifting market trends.
• Operating Model Canvas Template

Perceptual Map

What is a perceptual map.

A perceptual map template is a tool that marketers use to understand how consumers perceive their products or brands relative to the competition. The template typically plots two or more key attributes of the products or brands on a two-dimensional axis, such as price and quality. The relative positions of the products or brands on the map indicate how consumers perceive them based on those attributes. Perceptual maps can be used to identify opportunities for product differentiation, to target marketing campaigns, and to track changes in consumer perceptions over time.

• Analyzing market positioning.
• Visualizing consumer perceptions.
• Identifying competitive gaps.
• Assessing brand attributes.
• Understanding market trends.

How to Use the Perceptual Map?

• Pinpoint the crucial attributes that define your market, such as price, quality, or features.
• Place competing products on the map relative to these attributes.
• Plot your product, pinpointing its current market position.
• Analyze the map to devise effective strategies for repositioning, differentiating, or targeting specific customer segments.
• Implement a Successful Marketing Intelligence Strategy
• Guide to Building an Effective Go-to-Market Strategy

PEST Analysis

What is a pest analysis.

A PEST analysis is a strategic framework used by businesses to assess the external macro-environmental factors that can impact their operations: Political, Economic, Social, and Technological.

• Analyzing macro-environmental influences.
• Evaluating business strategy impact.
• Considering market and industry trends.
• Making informed strategic decisions.
• Planning for market entry or expansion.

How to Conduct a PEST Analysis?

• Identify categories: Divide the analysis into four categories: Political, Economic, Social, and Technological.
• Political factors: Examine political influences such as regulations, government stability, trade policies, and legal considerations that could impact the business.
• Economic factors: Evaluate economic indicators like GDP growth, inflation rates, exchange rates, and market trends that affect the business’s financial stability and growth potential.
• Social factors: Explore societal trends, demographics, cultural shifts, consumer behavior, and attitudes that could influence demand, preferences, and marketing strategies.
• Technological factors: Consider technological advancements, innovation, automation, and disruptions that may impact operations, products, or services.
• Assessment and action: Analyze the collected data in each category to identify opportunities and threats. Develop strategies to capitalize on favorable factors and mitigate risks posed by unfavorable factors, aligning the business with the changing external environment.
• PEST Analysis Tool
• SWOT Analysis vs PEST Analysis
• PEST Analysis Templates

Porter’s Five Forces

What is porter’s five forces analysis.

Porter’s five forces analysis template is a strategic management tool that helps businesses assess the competitive landscape of an industry. The five forces are:

• The threat of new entrants: How easy is it for new businesses to enter the market?
• Bargaining power of suppliers: How much power do suppliers have over prices?
• Bargaining power of buyers: How much power do buyers have over prices?
• The threat of substitute products or services: How easy is it for customers to switch to alternative products or services?
• Rivalry among existing competitors: How intense is the competition between existing businesses in the industry?

By understanding these forces, businesses can develop strategies to improve their competitive position and profitability.

• Entering new markets.
• Product launches.
• Introducing new pricing strategies.
• Entering into strategic partnerships.
• Market expansion.

How to Use It?

• Collect data on market opportunities, competitor profiles, and industry trends.
• Evaluate the five forces, grading their impact on your business. Pinpoint vulnerabilities and opportunities.
• Devise a proactive plan. Evaluate your strengths, mitigate threats, and enhance your competitive advantage.
• Regularly reassess your analysis to adapt to shifting forces and maintain your edge.
• The Easy Guide to Performing an Effective Situation Analysis
• How to Do a Competitive Analysis
• How to Successfully Achieve and Sustain Competitive Advantage

Product Roadmap

What is a product roadmap.

A product roadmap is a strategic planning tool used by businesses to outline the vision, goals, and timeline for the development and enhancement of a product. It provides a high-level overview of the product’s evolution, including key features, milestones, and planned releases. The product roadmap helps align teams, stakeholders, and resources around a shared product vision, making sure that everyone is on the same page regarding the product’s direction.

• Planning product development.
• Communicating product strategy.
• Managing product features.
• Prioritizing tasks and releases.
• Tracking product progress.

How to Create a Product Roadmap?

• Define vision: Clearly articulate the product’s overall vision, goals, and objectives.
• Identify priorities: Determine the most important features, enhancements, or fixes based on customer needs, market trends, and business goals.
• Set timeline: Outline key milestones and expected release dates for each prioritized item, creating a timeline for the product’s development.
• Share with teams: Communicate the roadmap to relevant teams, such as product, development, sales, and marketing, ensuring alignment and understanding.
• Review and adapt: Regularly review the roadmap, assess progress, and adjust priorities based on customer feedback, & changing technology or business requirements.
• How to Create a Product Roadmap
• Product Roadmapping Software
• Online Roadmap Maker
• Business Roadmap Template

Project Charter

What is a project charter.

The Project Charter Template is a strategic blueprint that defines the project’s scope, objectives, stakeholders, and initial roadmap. It lays the groundwork for seamless collaboration, clear communication, and informed decision-making from the project’s inception. Project Charter helps teams to align efforts toward shared goals.

• Initiating a new project.
• Establishing project constraints and assumptions.
• Setting project goals and success criteria.
• Gaining approval and commitment from stakeholders.
• Providing a clear project foundation for teams.

How to Use the Project Charter

• Clearly establish the project’s purpose, goals, and expected outcomes.
• Pinpoint the stakeholders, team members, and sponsors. Knowing who’s involved ensures smooth communication and accountability.
• Clearly define the project’s boundaries, deliverables, and constraints. This prevents scope creep and keeps the project on track.
• Present the Charter to stakeholders for buy-in. Their approval solidifies commitment and lays the groundwork for a successful project.
• How to Create a Winning Project Charter

Risk Assessment Matrix

What is the risk assessment matrix.

The Risk Assessment Matrix is a useful visual tool to foresee and manage potential risks. Streamline decision-making as you identify, evaluate, and prioritize risks that might hinder your goals. This framework allows project managers, entrepreneurs, and safety officers to take proactive action to mitigate vulnerabilities. It brings together quantitative analysis with qualitative insights, revealing vulnerabilities and helping to devise strategies to mitigate them.

• Developing risk mitigation strategies.
• Communicating risk information to stakeholders.
• Making informed decisions about risk management.
• Identifying areas needing increased attention.

How to Use the Risk Assessment Matrix?

• List down potential risks by brainstorming various scenarios that your venture might encounter. These could range from market fluctuations to operational mishaps.
• Quantify the potential impact and likelihood of each scenario. A sophisticated scoring system aids in prioritizing where attention is paramount.
• Craft actionable strategies to mitigate each identified risk. With clarity and foresight, you’ll be ready to steer clear of obstacles.
• Markets are dynamic, and risks evolve. Regularly revisit your template to align it with the shifting landscape, ensuring perpetual preparedness.
• The Ultimate List of Visual Risk Management Techniques
• Risk Matrix Template

SMART Goal Framework

What is a smart goal.

The SMART goal criteria is a structured framework used to create goals that are Specific, Measurable, Achievable, Relevant, and Time-bound. Each component of the SMART acronym helps make sure that the goal is well-defined and has a higher likelihood of being successfully achieved.

• Setting clear objectives.
• Enhancing goal clarity.
• Monitoring progress effectively.
• Focusing on specific outcomes.
• Creating actionable plans.

How to Set a SMART Goal?

• Identify your goal: Start by clearly defining what you want to achieve. Be specific about the outcome you’re aiming for.
• Make it specific: Clearly state the goal’s focus. Ask yourself who, what, where, when, and why to make sure the goal is detailed and clear.
• Quantify measurable metrics: Determine how you’ll measure progress and success. Use numbers or percentages to track your goal’s achievement.
• Assess achievability: Consider whether the goal is realistic and attainable within your resources and capabilities. Avoid setting goals that are too easy or too challenging.
• Ensure relevance: Check if the goal aligns with your overall objectives and priorities. Make sure that achieving the goal contributes meaningfully to your larger plans.
• Set a Timeline: Define a specific timeframe or deadline by which you aim to accomplish the goal. This creates a sense of urgency and focus.
• Write down the SMART Goal: Craft a concise statement that incorporates all the SMART elements. Make sure it’s clear, measurable, achievable, relevant, and time-bound.
• Plan your approach: Outline the steps or actions you’ll take to reach the goal. Break down the process into manageable tasks.
• SMART Goals Template
• The SMART Guide to Streamlining Your Projects
• SOAR Analysis

What is a SOAR Analysis?

SOAR, an acronym for Strengths, Opportunities, Aspirations, and Results, serves as a tool for organizations and individuals to identify their capabilities and align those with goals and objectives. This framework explores the strengths of an organization. It also helps discover emerging opportunities. SOAR addresses aspirations and desired outcomes. This emphasis on results helps organizations to take rightful actions that align with their overall goals.

Business leaders leverage SOAR to refine corporate strategies, educators incorporate it to guide academic institutions, and individuals adopt it to shape personal trajectories.

• Identifying areas for growth and improvement.
• Building on existing assets and resources.
• Encouraging innovation and creativity.
• Developing future-oriented strategies.
• Promoting positive organizational change.

How to Use SOAR Analysis?

• Begin by identifying your organization’s core strengths, encompassing talents, expertise, and unique resources. Unveil what sets you apart in the market.
• Explore external opportunities within your industry, market trends, and evolving customer needs. Uncover potential avenues for growth and innovation.
• Envision your desired future. Craft ambitious yet achievable goals that resonate with your organization’s mission and values. Create a roadmap for progress.
• Develop actionable strategies based on strengths and opportunities. Execute your plans diligently, tracking measurable results. Adapt as needed to ensure consistent advancement.
• Visual Guide to Improving Organizational Performance

Stakeholder Map

What is a stakeholder map.

A stakeholder map, also known as a stakeholder analysis or stakeholder matrix, is a visual tool used by businesses and organizations to identify and categorize individuals, groups, or entities that have an interest or stake in a particular project, decision, or initiative. The map helps to identify stakeholders, depict the relationships between them and the level of influence they hold over the outcome.

• Visualizing stakeholder relationships.
• Analyzing their influence and interest.
• Prioritizing engagement efforts.
• Planning communication strategies.
• Managing stakeholder expectations.

How to Create a Stakeholder Map?

• Identify stakeholders: List all individuals, groups, or organizations that have an interest or influence in your project or decision.
• Determine interest and influence: For each stakeholder, assess their level of interest in the project and their degree of influence over its outcome.
• Categorize stakeholders: Plot each stakeholder on a grid with interest on one axis and influence on the other. This categorizes them into quadrants: High Interest/High Influence, High Interest/Low Influence, Low Interest/High Influence, and Low Interest/Low Influence.
• Analyze priorities: Focus your attention on stakeholders in the High Interest/High Influence quadrant. Tailor your communication and engagement strategies based on the priorities of each quadrant.
• Document details: Add relevant information for each stakeholder, including their roles, expectations, concerns, and preferred communication methods.
• Stakeholder Analysis Example
• Stakeholder Register Template
• Guide to Stakeholder Management
• Stakeholder Management Plan Templates
• Stakeholder Engagement Plan

STEEPLE Analysis

What is steeple analysis.

The STEEPLE Analysis template helps organizations make decisions by evaluating the external forces shaping their environment. STEEPLE is an acronym for Social, Technological, Economic, Environmental, Political, Legal, and Ethical factors. Social aspects delve into cultural trends and societal shifts, while the Technological dimension explores innovations driving change. Economic factors focus on financial impacts, while Environmental and Ethical factors gauge sustainability and morality. Political and Legal components consider governmental influences and regulatory changes.

• Assessing potential impacts on business.
• Understanding industry trends and changes.
• Planning strategic responses to external influences.
• Enhancing strategic planning and risk management.

How to Use the STEEPLE Analysis?

• Collect data on each dimension—social trends, technological advancements, economic indicators, environmental concerns, political landscape, legal regulations, and ethical considerations.
• Evaluate the collected data to identify trends, opportunities, and challenges within each dimension.
• Discover intersections and correlations between dimensions. How might political decisions influence technology, for instance?
• Craft strategies that align with the insights gained, fortifying your business against uncertainties and fostering innovation.
• STEEPLE Analysis Template

Strategy Map

• What is a Strategy Map?

A strategy map is a visual framework that provides a clear and concise representation of an organization’s strategic goals, objectives, and the cause-and-effect relationships between them. It is designed to depict how various components of a business’s strategy are interconnected and how they contribute to achieving the organization’s mission and vision.

When to use

• Visualizing strategic objectives.
• Communicating strategy clearly.
• Depicting cause-and-effect relationships.
• Monitoring progress towards goals.

How to Create a Strategy Map?

• Define objectives: Identify the key strategic objectives that support the organization’s mission and vision.
• Categorize perspectives: Group objectives into perspectives such as Financial, Customer, Internal Processes, and Learning & Growth.
• Establish relationships: Determine how objectives in one perspective contribute to objectives in other perspectives.
• Arrange hierarchically: Organize objectives within each perspective hierarchically, from high-level goals to more specific objectives.
• Visual representation: Create a visual diagram using shapes or boxes connected by arrows to depict the relationships between objectives.
• Review and refine: Make sure the map is coherent, aligned with the organization’s strategy, and visually clear. Refine as needed to accurately convey the strategic connections.
• Strategy Mapping Software
• Strategy Diamond

What is Strategy Diamond?

The Strategy Diamond Template is a tool used by businesses and organizations to crystalize their strategic thinking, align their goals, and drive effective decision-making. This framework, often attributed to management guru Donald Hambrick and James Fredrickson, offers a comprehensive view of a company’s strategy by breaking it down into five key elements: Arenas, Vehicles, Differentiators, Staging, and Economic Logic.

• Developing new strategies.
• Reviewing or refining an existing strategy.
• Creating communication strategies.
• Responding to changing market conditions.

How to use it?

• Arenas: Start by identifying the broad market spaces or arenas where your organization competes. This could involve geographical locations, product lines, customer segments, or distribution channels. Define the boundaries of your strategic scope.
• Vehicles: Determine the key strategic vehicles your organization will use to compete in the chosen arenas. These could be specific products, services, or technologies. Assess their potential for success and alignment with your overall strategy.
• Differentiators: Pinpoint the unique attributes and differentiators that set your offerings apart from competitors. This step is crucial for creating a compelling value proposition and building a sustainable competitive advantage.
• Staging and Economic Logic: Outline the sequence of actions (staging) required to achieve your strategic objectives. Additionally, clarify the underlying economic logic of your strategy, addressing how your chosen vehicles and differentiators will create value for your organization.
• The Top 7 Tried and Tested Strategy Frameworks for Businesses
• How to Visualize an Organizational Strategy

SWOT Analysis

What is a swot analysis.

A SWOT analysis is a strategic planning tool used by individuals, teams, or businesses to assess their current situation.SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. SWOT analysis guides businesses in crafting effective strategies, making informed decisions, and adapting to changing environments, ultimately driving success and growth.

• Assessing business strategies.
• Evaluating a project’s viability.
• Understanding market positioning.
• Developing action plans.
• Considering new ventures or changes.

How to Conduct a SWOT Analysis?

• Gather information: Collect data and insights about your business, project, or situation (i.e. internal assessments, market research, & competitor analysis).
• Identify strengths and weaknesses: List your internal strengths and weaknesses. These are aspects you have control over and can work on to improve your position.
• Identify opportunities and threats: List external opportunities and threats that could impact your objectives. These are factors you can’t control, but you can prepare for or leverage.
• Combine insights: Examine the relationships between your internal factors and external factors. For example, how can you use your strengths to seize opportunities, or how can you address weaknesses to mitigate threats?
• Develop strategies: Based on your analysis, develop strategies that use your strengths to seize opportunities, address weaknesses to minimize threats, and so on.
• Prioritize and take action: Rank the factors within each category in terms of their importance and impact. Focus on the most critical ones when developing your strategies.
• SWOT Analysis Tool
• SWOT Analysis Templates for Any Situation
• How to do a SWOT analysis
• Personal SWOT Analysis

Value Chain Analysis

What is value chain analysis.

A value chain analysis template is a tool that businesses can use to identify and improve the activities that create value for their customers. It is a visual representation of the company’s operations, broken down into primary activities (inbound logistics, operations, outbound logistics, marketing and sales, and service) and support activities (procurement, technology development, human resource management, and firm infrastructure).

• Analyzing a company’s internal activities.
• Identifying opportunities for cost reduction.
• Assessing areas for process improvement.
• Evaluating competitive advantage sources.
• Aligning activities with strategic goals.

How to Use Value Chain Analysis?

• Begin by visualizing your organization’s value activities – from inbound logistics to marketing and beyond. This clear bird’s-eye view lays the foundation.
• Pinpoint crucial activities contributing to costs and differentiation. What sets you apart? What can be streamlined?
• Assess each activity’s efficiency. Are there innovative technologies or processes that can boost productivity?
• Armed with insights, craft strategies that align with your findings. Enhance customer experiences, optimize costs, and cement your market position.

Value Proposition Canvas

What is it.

The value proposition canvas helps organizations to align their products and services with what the customer values and needs. It is divided into two blocks as follows.

Customer Profile

• Gains – Needs and the benefits that a customer expects. What would delight the customer.
• Pains – Negative emotions that a customer experiences when getting something done.
• Customer jobs – The needs they are trying to satisfy and the problems they are trying to solve.
• Gain creators – How the product adds value to customers and how it creates customer gains.
• Pain relievers – How does the product alleviate customer pains?
• Products and services – The products and services that add value to the customer while creating gains and alleviating pains.
• Understanding customer needs and pain points.
• Refining products and services.
• Differentiating from competitors.
• Identify your target audience. Define their jobs, pains, and gains they seek.
• Map your products to customer needs. Highlight how you alleviate their pains and amplify their gains.
• Analyze what customers crave and how your offerings satisfy those cravings.
• Continuously enhance your value proposition by refining your canvas based on feedback and insights.
• Ultimate List of Business Analysis Models
• VRIO Analysis

What is VRIO Analysis?

Entrepreneurs, managers and strategists use VRIO analysis to identify competitive advantages within businesses. It helps evaluate organizations’ resources based on four dimensions: Value, Rarity, Imitability, and Organization. This method reveals a company’s unique strengths, resources and areas for improvement.

VRIO Analysis transforms insights into actionable strategies. Whether you’re refining your product’s distinctiveness or amplifying your market presence, VRIO helps your business achieve strategic success.

When to Use?

• Assess and optimize resource allocation
• Evaluate competitive advantage
• Identifying competitive weaknesses
• Make market entry Decisions
• R&D and innovation

How to Use the VRIO Analysis?

• List your company’s key tangible and intangible resources.
• Determine to what extent they add value and if they’re rare in the market.
• Analyze how easy it is for competitors to replicate these resources.
• Create an operational structure that will help your organization to effectively leverage these resources.
• Top 7 Tried and Tested Strategy Frameworks for Businesses

5 Whys Analysis

What is 5 whys analysis.

Five Whys Analysis is a structured method that helps to uncover the fundamental “whys” behind a problem. By iteratively asking “why” five times, it reveals underlying factors contributing to an issue, which are otherwise obscured on the surface. Whether you’re an engineer, manager, or a project leader, the 5 Whys Analysis empowers you to pinpoint the root causes of a problem.

• Investigating root causes of problems.
• Uncovering underlying issues or factors.
• Identifying systemic reasons for failures.
• Promoting deeper understanding of issues.
• Developing effective corrective actions.

How to Use the 5 Whys Analysis?

• Clearly define the problem you’re facing, ensuring everyone is on the same page.
• Probe the initial problem with “Why?” questions. Continuously dig deeper, unraveling the layers of causation. Repeat this step at least five times.
• Synthesize the “Whys” to pinpoint the root cause. This deep understanding paves the way for targeted solutions.
• Armed with a precise understanding, enact corrective measures. Monitor outcomes and refine as needed.
• Problem-Solving Through Root-Cause Analysis
• Guide for Efficient Business Problem-Solving

Task Management

Eisenhower matrix, what is the eisenhower matrix.

The Eisenhower matrix, also known as the urgent-important matrix, is a simple tool for prioritizing tasks and making effective decisions about how to spend your time. It helps you categorize tasks based on their urgency and importance, allowing you to focus on what matters most. It was popularized by Dwight D. Eisenhower, the 34th President of the United States.

• Prioritizing urgent tasks.
• Allocating resources for important goals.
• Streamlining delegation & project planning.
• Aligning activities with strategic objectives.

How to Use the Eisenhower Matrix

• Create the Eisenhower matrix: Draw a grid with four quadrants or use a pre-made Creately template to get a head start.
• Urgent and Important (Quadrant 1): Tasks that are both urgent and important go here. These are top priorities and need immediate attention.
• Important but Not Urgent (Quadrant 2): Tasks that are important but not urgent. These tasks contribute to your long-term goals and should be scheduled to avoid becoming urgent later.
• Urgent but Not Important (Quadrant 3): Tasks that are urgent but not important are placed here. These tasks can often be delegated or minimized to free up more time for Quadrant 1 and 2 tasks.
• Neither Urgent nor Important (Quadrant 4): Tasks that are neither urgent nor important. These tasks are distractions and should be minimized or eliminated.
• Prioritize and act: Start with Quadrant 1 tasks, as they need immediate attention. Move on to Quadrant 2 tasks, as these impact your goals. Delegate or minimize Quadrant 3 tasks, and avoid Quadrant 4 tasks.
• Regular review: Review regularly and update your Eisenhower matrix. Tasks can shift between quadrants as circumstances change.

Creately Resource

• Eisenhower Matrix Template
• Eisenhower Matrix Examples

Gantt Chart

What is a gantt chart.

A Gantt chart is a visual tool used in project management to plan, schedule, and track tasks and activities over a specific period of time. It shows a graphical representation of a project’s timeline, highlighting the start and end dates of various tasks or activities, their dependencies, and the overall progress of the project.

• Visualizing task timelines.
• Tracking task dependencies.
• Monitoring progress.
• Allocating resources.
• Communicating project status.

How to Create a Gantt Chart?

• Identify tasks: List all the tasks and activities required for your project. Break down large tasks into smaller, manageable subtasks.
• Timeline setup: Create a timeline along the horizontal axis, representing the project’s start and end dates. Assign tasks to their respective timeframes by plotting horizontal bars.
• Identify task dependencies: Identify the tasks that must be completed before others can begin – and connect them on the chart. Make sure the sequence is clear to avoid bottlenecks.
• Bar length and milestones: Adjust the length of each task’s bar to reflect its duration. Add vertical lines to represent significant milestones or deadlines.
• Allocate resource: Assign responsible team members to each task. Make sure that team members are not overloaded and that dependencies are considered.
• Monitor and update: Update the Gantt chart regularly to reflect actual progress. As tasks are completed, adjust the bars accordingly, and note any delays.
• Gantt Chart Maker
• Gantt Chart Templates to Create Project Timelines
• Draw Gantt Charts Online Easily Using Creately
• Gantt Charts and Flowcharts in Project Planning

Workflow Diagram

What is a workflow diagram.

A workflow diagram is a visual tool that illustrates the sequence of steps, tasks, activities, or processes required to complete a specific project, task, or operation. It provides a clear and concise overview of how work flows from one stage to another, highlighting the relationships and dependencies between different elements of the process.

• Mapping task sequences.
• Clarifying work procedures.
• Identifying bottlenecks.
• Communicating workflows.

How to Create a Workflow Diagram?

• Define process and goals: Clearly define the specific process you’re diagramming. Understand the objectives of the process and define itsarting and ending points.
• Gather information: Gather information about the sequence in which tasks occur, the inputs required for each task, the outputs produced, and any decision-making factors.
• Draw the diagram: Using the specific workflow diagram shapes, create the diagram to visualize the workflow.
• Show inputs, outputs, and relationships: Use arrows to show which inputs are needed for each task, entering the respective task shapes. If certain tasks are dependent on others or have specific relationships, show these connections with arrows.
• # Workflow Diagram Software
• What is a Workflow? A Simple Guide

Join over thousands of organizations that use Creately to brainstorm, plan, analyze, and execute their projects successfully.

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Amanda Athuraliya is the communication specialist/content writer at Creately, online diagramming and collaboration tool. She is an avid reader, a budding writer and a passionate researcher who loves to write about all kinds of topics.

Prioritization Matrix 101: What, How & Why? (Free Template)

As humans, we tend to focus more on the things we need to do than the things we’ve already done. This so-called “Zeigarnik effect”, named after Russian psychologist Bluma Zeigarnik , means our minds are often swimming with all of the tasks, responsibilities, and mental notes that we think we should be focusing on. That’s where Prioritization Matrix can help!

All of these tasks and projects that need doing, this mental to-do list, without a clear hierarchy of importance can make it difficult for us to stay focused and actually get things done.

One way to combat all of this Zeigarnik noise is to note down everything. Make an actual to-do list. Studies have been done , and it has been shown that the very act of noting down tasks can quite simply “make you more effective”.

But, even with a to-do list, before you actually get anything done it’s necessary to have a clear idea of your priorities.

Sounds simple enough, right? Unfortunately, figuring out what to prioritize can be hard. It’s a complicated process that involves weighing up cost against value, effort against time, and for a lot of businesses, will likely involve many different stakeholders.

The solution is to work out a process for determining what to prioritize.

Having a clear process for lining up your tasks or projects, and deciding which of them you should prioritize right now, can save you from wasting time deliberating on less important things.

In this article we’ll be looking at one of the many techniques for sorting out your priorities – the prioritization matrix. I’ll break down the basic idea, and run through a few different approaches for building your own prioritization matrix. There’s even a free premade checklist template you can use to guide you through the whole process.

The concept of a prioritization matrix was popularized by authors Michael Brassard ( The Memory Jogger 2 ) and David Allen ( Getting Things Done ).

I’m sure you’re keen to see the actual template, so here’s a quick link:

You can click here to get the prioritization matrix template.

Now, let’s start with the basics.

What is a prioritization matrix?

A prioritization matrix is a business process analysis tool, often used alongside other bpm software or Six Sigma techniques for comparing choices using specific criteria, and figuring out what to prioritize.

It can be applied to anything, from simple tasks to complex projects, by anyone, from single individuals to large organizations.

A prioritization matrix provides stakeholders with a reliable process for resolving disagreements, and deciding on which proposals to focus on. They also help to weed out disingenuous incentives and hidden agendas, in the case of project prioritization, by promoting consensus.

There are multiple forms a prioritization matrix can take, based on complexity of criteria for assessing priorities, as well as what those specific criteria are defined as.

For example, some matrices are simple 2×2 grids with “cost” plotted against “value”, like this:

Others, like those used in the Six Sigma methodology, are more complicated and require a more thorough approach to design and application.

Prioritization matrix for Six Sigma

A prioritization matrix can also refer to a specific Six Sigma technique for continuous improvement. It is one of the seven management tools used in the Six Sigma methodology.

In this context, a prioritization matrix is a visual diagram used to compare multiple (at least two) sets of data using weighted criteria.

Project prioritization is critical to the overall quality improvement process in Six Sigma. Here, prioritization matrices are practical tools used in the planning and analysis phases of various continuous improvement methodologies like DMAIC and PDSA.

These matrices are often more complex, like this cause-and-effect matrix for calculating Six Sigma input (X) and output (Y) priorities:

3 types of priority matrix

Within Six Sigma, there are at least three different types of prioritization matrices, as defined by Lynne Hambleton in Treasure Chest of Six Sigma Growth Methods, Tools, and Best Practices: A Desk Reference Book for Innovation and Growth :

• Full analytical criteria

Consensus criteria

Combination matrix

Full analytical criteria This method is by far the most complex type of prioritization matrix, as it involves using multiple matrices to compare different pairs of options before a final matrix is produced.

It is best reserved for your most important decisions, and works best with smaller teams (three to eight people) due to the nature of a wider scope making it harder to reach consensus with more people involved.

When all your options appear to be roughly equal, this method is a simplified version of the full analytical criteria.

It also uses weighted voting, where a number value is given to each option to rank priority.

Works best with fewer (less than 10) items and criteria, in order to keep things simple.

For prioritizing options based on a cause-and-effect relationship, use a combination matrix.

Unlike the other methods, which are based on criteria, the combination matrix is causal-based, which means you’ll need an experienced team with in-depth knowledge of the process you’re optimizing your priorities for.

This method uses L-shaped diagrams to show critical relationships between two or more groups, in combination with a tree diagram to depict hierarchy of tasks.

I’ll be looking more closely at the consensus matrix later on in the post, after going over a more simplistic method.

Simple or complex, matrices are shaped by the criteria they use to define priorities, and how your matrix will look largely depends on what you are trying to prioritize.

The point is, a prioritization matrix has one goal: to sort your options in order of importance. Whatever type of matrix you’re using, the process used is pretty much the same.

Benefits of using a prioritization matrix

In principle, the benefits of a prioritization matrix are quite straightforward. In support of structured decision-making, they make it easy to:

• Break down and prioritize complex issues when there are multiple factors influencing the decision
• Objectively and unambiguously rank your priorities
• Determine most crucial focus areas
• Establish a basis for discussion about what is important
• Garner team/stakeholder support for important buy-ins

In the following section, I’ll run through the steps for a simple 2×2 grid matrix, and afterwards go on to explore how to use a more complicated matrix with weighted criteria.

Simple prioritization matrix (5 steps)

In its simplest form, it’s a 2×2 grid that plots simple, direct concepts like “urgency” and “importance”.

This kind of matrix is great for prioritizing small business tasks, and is a basic yet reliable process for making sure you’re dealing with your to-do list in the most efficient manner possible.

Step 0: List your tasks

You may or may not have already done this, but the first step for any prioritization matrix is to make a list of all of your tasks, or whatever it is you’re trying to prioritize.

Step 1: What are the consequences?

Ask yourself what might be the consequences for not doing each of your tasks, or more generally, not prioritizing a certain option.

Step 2: What’s important?

Split your list into two categories: high and low importance. Then, considering all consequences you listed in the previous step, place each of your options into the category you deem most fit.

Step 3: What’s urgent?

Now, for all “high importance” and “low importance” options, split each into a further sub-category of “high urgency” and “low urgency”. You should now have four groups in total.

Step 4: Assign number values

Now, assign number values 1 to 4 to each of your options, where a lower number means a higher priority.

• High importance and high urgency: 1
• High importance and low urgency: 2
• Low importance and high urgency: 3
• Low importance and low urgency: 4

This quick, simple method can help you cut through mental noise and start getting things done with basically zero setup time.

If you want to know how to apply a more advanced prioritization matrix, then read on.

How to use a prioritization matrix

Whatever the matrix, the procedure starts with making a list of all of your (unsorted) priorities, and ends with that same list ordered by some quantifiable metric.

Here, we’ll look at the process for using a consensus criteria matrix, one of the three main matrices used in Six Sigma.

This process is best performed with a small group (less than 10 people).

That process can be broken down into five simple steps.

0. Orient your team

Before doing anything else, you must clearly explain the purpose for constructing the prioritization matrix.

This will involve going over the context of company goals, as well as current strengths and weaknesses the business currently faces.

Now is also when you should make sure everyone involved in the process agrees on the options (solutions, projects, or whatever) that need to be prioritized.

In order to facilitate this kind of communication of context of the organization, you may want to consider performing a SWOT or FMEA analysis, and presenting the results to your team.

1. Determine your criteria

Once your team is prepped, and you have a clear idea of what options you’ll be prioritizing, it’s time to set out the criteria for assessing importance.

This can be broken into two parts:

• The actual criteria
• A rating scale with which to assess importance

You and your team should focus on criteria that clearly differentiates important from unimportant options. Aim for around five to ten different criteria.

You want to have enough criteria to reasonably discern your priorities, but not too much that consensus becomes difficult.

For example, you may include criteria such as:

• How much value a certain option offers the customer
• Whether or not it is of regulatory importance
• Long-term versus short-term impact

When deciding the rating scale, it’s important to base the scale on some concrete reference point that everyone will clearly grasp. The table below illustrates this nicely, in the right column:

2. Give each of your criteria a weighted value

Next, place your criteria in descending order of importance, with the most important option at the top, and give each of your criteria a weighted value.

Make sure this weighting is agreed on by everyone involved.

To extend the example used above, you might choose to give the following weighted values:

Required Service or Product: Weight = 5 Strategic Alignment: Weight = 4 Value to Customer: Weight = 4

This weighted value represents the relative importance of each criterion, and will be used to calculate the final score.

3. Prepare the matrix

Make a list of your criteria on the left, with the weight, scoring values, and options across the top, like so:

Fill in all the remaining details, and you’ll be ready to score your table.

4. Score each option

Review each option against all criteria, and decide what score you think is adequate. Don’t record this value in the right-hand column just yet, because you still need to calculate the weights.

If possible, it is helpful to determine scores together in teams, rather than alone. This will facilitate consensus and help alleviate bias. Ideally, you want to evaluate each option by two different teams, and average the results.

By working in teams, you benefit from:

• More objective, reliable results
• If you have a large number of options to review, splitting the workload over a team of people can improve efficiency and speed things up
• Multiple teams scoring the same option means you can gain insight into how well your criteria has been defined, and whether or not everyone in your organization truly understands the purpose of the exercise to the same level
• Consistency and efficacy of the rating scale can more accurately be determined

During the scoring process (but ideally before, in the orientation stage) providing your team with resources like strategic plans and company policies will help to make sure your team members are able to make a properly informed evaluation.

5. Calculate weighted scores for each option

Once you’ve decided on the scoring, multiply the corresponding score with the weight value of each criterion and record the value in the right column.

Finally, add all values for each option and record the cumulative score in the bottom row.

The options are then ranked in order of priority based on their total score.

6. Compare your results with your team

Everyone should have scored their options and have a preliminary list of ordered priorities.

Now it’s time to have an open discussion with your team, where you can compare and consolidate notes to create a master list that everyone agrees upon.

If there is disagreement within your group, numerically valued ratings allow for quick and easy adjustments. Adjustments should be expected, and fine-tuning the rating system or weighted values should be seen as stages in the cycle of continuous improvement.

Despite best intentions, you must remember that the prioritization matrix is a tool to establish an actionable hierarchy of importance. It is not the be-all, end-all, and priority ranking for each option can (and should) be challenged, regardless of the score it received.

As a final note, it’s a great idea to run the results of the analysis past as many relevant-interested-eyes as possible. Stakeholders, customers, and other employees will be able to give you valuable feedback on the results of your prioritization matrix analysis.

Free prioritization matrix template

This simple (and free!) prioritization matrix template will help simplify the whole process of preparing for and using a prioritization matrix for yourself or your business:

Click here to get the prioritization matrix template

You can use it to streamline every step, from deciding which options to prioritize, to sharing your results with relevant interested parties, and it even creates a simple matrix for you, automatically! Process Street features like conditional logic and dynamic due dates lighten your workload of tedious repetitive tasks.

If you haven’t already, sign up for a free Process Street account today, and get this + tonnes more premade templates to help you with prioritization and business process management .

What’s next?

You’ve got your priorities straight, now it’s time to act on them. The nature of your priorities will determine where you go from here.

What does your number one priority look like? Perhaps it’s a problem with a specific process that needs dealing with, in which case the following table may be useful:

Here are some methodologies for continuous improvement that you could use to tackle your number one priority:

• Design for Six Sigma (DFSS)
• DMAIC: The Complete Guide to Lean Six Sigma in 5 Key Steps
• The 7 Core Six Sigma Principles to Build Your Business Around

Did you find this article useful? Was there anything you weren’t sure about? Feel free to let us know in the comments below, and we’ll try and help you out in any way we can.

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Oliver Peterson

Oliver Peterson is a content writer for Process Street with an interest in systems and processes, attempting to use them as tools for taking apart problems and gaining insight into building robust, lasting solutions.

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Strategic Planning: Steps to Achieve Your Business Goals

The process of strategic planning is the core element of any business or other organization. In fact, strategic plans can even be applied to your own career and personal life. Despite being one of the most important elements of a business, strategic planning is often neglected by businesses, which tend to focus on a win-now approach. 

Each year, companies typically gather together a team to discuss strategy and plan for the next year. What comes out of that strategic planning meeting is key for what your company is going to be doing in the year to come and beyond and the goals that everyone will be working towards.

Strategic planning and management done right, can help lead you to success. On the other hand, weaker plans or those with less drive from the top can result in teams working at cross-purposes and significant market share losses…or worse. 

What is strategic planning?

Strategic planning is the process by which an organization establishes and revises its core long-term goals and creates a plan to achieve those goals. Strategic planning involves multiple review periods and continuous revisions to establish that the business is on the right strategic track. 

What is strategic management?

Strategic management is the overall control of the direction of your company based on current and planned capabilities to achieve a set of planned goals. In essence, this means that strategic planning is a part of the overall process of strategic management, which is a broader concept that includes implementation and review. For our purposes, we’ll look at strategic planning as encompassing the entire process of strategic management. Internally at your organization, you’ll also want to appoint some people to manage the strategy implementation, which is separate from the strategic planning process. 

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What is the 4P Marketing Matrix?

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The principle of the 4P Matrix is that marketing decisions usually fall into four controllable categories: product, place, price and promotion. Carefully positioning your product in each category will generate the greatest response from your target market.

The 4P Matrix dates back to the 1960s, and is arguably the most frequently used marketing mix matrix because it’s simple and it works. This marketing mix matrix can help you define your options and identify marketing strategies , whether you’re planning to launch a new product or you’re evaluating an existing one.

As a small business owner, learning to use the 4Ps successfully gives you an advantage over the competition—and that’s good for your bottom line.

Considerations include: benefits, features, and product interaction From the most basic to extremely detailed, there are a number of questions to ask when making product marketing decisions. Here are a few of the most important:

• What need does your product satisfy? What problem does it solve, or what challenge does it help the customer overcome? In other words, what will the customer gain by using your product? How will it benefit him or her?
• What features does the product have that help it meet the needs of your customer?
• What is your product’s competitive advantage? How is your product different from your competitors? Why should the customer buy your product instead of your competition’s?
• Let others interact with your product, and then ask if it includes any features that aren’t really useful. Also, ask if there are features the product should offer, but doesn’t.

Under what circumstances do you anticipate the customer with interact with the product? How and where will they engage with it?

Real life example: In Coca Cola's case, they have a wide product range, and many of them have been invented due to the needs of their audience (caffeine-free, zero-sugar, etc). They have adapted well to the concerns of the public regarding their original sugary drinks and continue to be a very valuable brand.

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Considerations include: location, how to get product into the market , and distribution Questions to ask about place range from how it will be distributed to what market it will be found in. Here are a few questions to get you started thinking about place:

• Where will your potential buyer look for your product? Will it be found in a brick and mortar store, in a catalog, only on the web or a combination of one or more locations?
• If your product will be sold in a brick and mortar store, what characteristic will the store have? For example will it be sold in a boutique, or sold through a discount store? Will it be found in a house wares store, grocery store, children’s store, etc?
• What is your plan for getting your product into the market.
• Will you sell directly to your customers or use a distributor or a sales team?

How will you manage inventory?

Real life example: With Coca Cola, they have a wide network of distributors that sell their products across the world. This includes in grocery stores, gift shops, cafes, and restaurants. 

Considerations include: price strategy, discounts, and profit margin When considering what price to set your product at, remember that your customer must perceive value in your product and that means you won’t win customers on price alone. Consider these questions when trying to set your product price:

• What amount does your competition sell the product for? Are you able to set and maintain a competitive market price? How will your price compare to your competitors?
• Will you offer discounts or buying advantages? Will you offer a loyalty program or rewards program?
• Will your product be offered at more than one price point? If so, why?
• What is the lowest price you can set for your product and still maintain the profit margin you need?

What part or process is the biggest contributor to the product’s retail price? Can you do anything to lower the cost of that part or process?

Real life example: Coca Cola is known for it's competitor pricing, meaning it prices its products according to its competitors (Pepsi). They also offer different price points based on location.

4. Promotion

Considerations include: marketing channels, marketing strategy , and seasonality Even the best products won’t sell if your customer doesn’t know about them. When considering how you will promote your product, ask yourself these important questions:

• By what means will you get your marketing message to your potential customer? For example, will you use direct mail, billboards, the web, social media, etc?
• When will you start promoting your product and what is your reason for promoting it at that time? Will you promote the product two months before its release? Six months prior?
• Is the product seasonal? If so, how will that impact when, where and how you promote it?

If you’re using a social media platform to promote your product , when (what day/s of the week and what time/s) does your target engage with that social media outlet? For example, moms who work outside the home interact with social media at different times of the day than college students.

Real life example: There are numerous strategies Coca Cola uses to promote its global brand—from different types of media advertising campaigns to sponsorships and partnerships.

Use the 4P Matrix to analyze your current products as well as any new products you're developing. Make sure to follow up with products periodically to make sure it's still on target with your demographic. The 4Ps model is just one of several marketing mix matrixes that have emerged over the last several decades, but it’s simple yet comprehensive framework makes it one of the very best.

Related reading

• 4Cs Marketing Model & Why It’s Good for Business
• 5 Steps to Improve Your Marketing Strategy
• 9 Top Marketing Strategies for Startups
• 6 Effective Ways to Engage Your Customers With Social Media Marketing
• Digital Marketing 101

4Ps of Marketing FAQ

The 4P framework is used to help marketers make decisions regarding their target audience using 4 different variables in the marketing mix.

The 4Ps are product, place, price, and promotion. The 4Cs consist of customer, cost, communication, and convenience.

The 4Ps take a producer-oriented approach to marketing, while the 4Cs take a customer-oriented approach.

First, identity the product or service you're working with. Then, go through each variable and answer the relevant questions. Keep asking questions until you feel you've satisfied your marketing mix. 

Jerome McCarthy invented the framework (also referred to as the producer-oriented model) in 1960.

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Priority matrix: How to identify what matters and get more done

A priority matrix sorts tasks or projects by a defined set of variables, like urgency and effort. With this tool, team members can quickly determine what to tackle first. In this piece, we’ll discuss various types of priority matrices and explain how you can use them to accomplish more at work.

Project managers must have many skills to keep teams and projects on track. With so many moving parts, one of the hardest tasks is knowing what to tackle first. If a team member has two clients with high-priority projects, how can you help them prioritize and remain successful?

A priority matrix can help you sort your to-do list by things like urgency, importance, or impact. In this piece, we’ll discuss various types of priority matrices and explain how you can use them to accomplish more at work.

What is a priority matrix?

A priority matrix—also known as a prioritization matrix—sorts tasks or projects by a defined set of variables. Priority matrices can be simple or complex and may include anywhere from four quadrants to 20 rows or columns. 

In a four-quadrant priority matrix, your task may fall into four categories. For example, your quadrants may be:

High impact and high effort

High impact and low effort

Low impact and high effort

Low impact and low effort

By mapping your tasks along a priority matrix, you can determine how and when to tackle each to-do.

Priority matrix vs. Eisenhower matrix

Some people use these terms interchangeably, but a priority matrix is a broader framework that’s more versatile than the Eisenhower matrix model. The Eisenhower matrix is a simple priority matrix that has a time management focus. It maps tasks along a grid based on their urgency and importance.

When using the Eisenhower priority matrix, you’ll sort tasks by:

In an action-centered priority matrix, you’ll sort tasks by:

Investigate

When to use a priority matrix

Priority matrices are helpful when you need a quick solution to sort through and prioritize important initiatives. A priority matrix won’t help you solve complex calculations or actually make data-driven decisions , but it will help you create a map to get things done.

Bring out the priority matrix when you need to:

Prioritize tasks or projects 

Manage your time

Get your team on the same page

The priority matrix can be helpful when mapping out work schedules or workflows . It can also aid in conflict resolution , as it’s sometimes hard for teams to decide which projects or tasks to work on first.

How to use a priority matrix

The priority matrix is a versatile tool, and you can use it in various situations. Whether you’re sorting through your own tasks or managing team projects, the steps below will set you up for success.

1. Create a to-do list

The first thing you’ll need to do when using a priority matrix is make a list of things needing prioritization . This may seem like an obvious step, but many people don’t take the time to define their to-do list . By writing down the important tasks you have in front of you, you’ll have an easier time sorting through them and mapping them out. 

Your to-do list can include:

Team meetings

Client calls

Personal chores

You can create separate lists for internal and external work obligations (for example team-facing only and client-facing). You can also keep personal and professional items separate. However, it may be helpful to see how all your to-dos mesh together.

2. Identify your variables

Once you know the scope of your to-do list, determine the variables to measure your items by. To identify these variables, ask yourself: What qualities would a task need to be at the top of my to-do list?

Your answers may be:

It’s important

It has a lot of impact

It requires a lot of time

It requires a lot of effort

The deadline is approaching

Then, choose two of these qualities to measure your tasks. For example, you may decide that deadlines (in other words, urgency) and effort are the variables that apply to most of your projects.

3. Create your matrix

Before creating your priority matrix, decide whether you want it to be simple or complex. Both matrices will measure your tasks by the two variables you’ve chosen, but a complex matrix can help you get more precise about how urgent your tasks are and how much effort they take to complete.

If you choose a complex priority matrix, you may have five columns and five rows versus the standard one quadrant system of a simple matrix. Give your columns and rows labels so you know where to place your tasks according to their level. For example, you can assign levels of urgency and effort from high to low:

Required (5)

Significant (4)

Moderate (3)

Very High (5)

Very Low (1)

It’s also helpful to assign numerical values to each variable level. That way, you can multiply the corresponding numbers to find your task’s priority level in the grid. Once each of your tasks has a number, you can rank your tasks accordingly. For example, a task that is “required” urgency and “medium” effort would have a priority level of 15.

4. Place tasks in the matrix

Placing tasks in the priority matrix will involve some subjective decision making. Because this tool is a quick solution for getting things done , you’ll need to rely on experience and background knowledge as judgment. Place tasks in their appropriate order along the matrix according to the variables you have selected.

If you have two projects that seem tied in terms of urgency or high effort, dive deeper until you find a reason to prioritize one over the other. This is where other variables may come into play. For example, both tasks may be urgent, but one task may take priority over the other if it’s both urgent and more impactful than the other. 

5. Create an action plan

Once you’ve placed all of your tasks in your priority matrix, you should be able to visualize things more clearly. The matrix will show you what tasks to accomplish first and which tasks you have more time to complete. While this is a good starting point, the best way to expand on your priority matrix is to create an action plan . 

An action plan does more than show you which tasks to complete first—it helps you outline exactly how you’ll accomplish your goals. To create an action plan using the tasks from your priority matrix, you’ll:

Set SMART goals

Allocate resources

Create deadlines and milestones

Monitor and revise your plan as needed

Use task management software to streamline your action plan in a central source of truth. That way, you can communicate and track items with your team.

Priority matrix example

We showed a comparison above between a simple and complex priority matrix. Here’s an example of a complex priority matrix using urgency and effort as two variables of measurement. Numerical values and colors are included to make the tasks easy to sort through.

The original to-do list for this matrix may have looked like this:

Plan team workshop

Finish budget proposal for Client A

Onboard new hire

Send performance reviews to the department head

Write an ebook for company website

Edit whitepaper for Client B

Sign new hire documents

A prioritized version of the to-do list would look like this:

Finish budget proposal for Client A (20)

Onboard new hire (15)

Write ebook for company website (15)

Edit whitepaper for Client B (12)

Send performance reviews to the department head (10)

Sign new hire documents (8)

Plan team workshop (6)

Onboarding a new hire and writing an ebook for the company website both have a priority level of 15. Onboarding a new hire would ultimately come first in the to-do list because it’s more urgent than writing the ebook. Urgency is often the most important variable in the priority matrix.

How Asana uses work management for project intake

Learn how Asana's PMO leaders streamline intake and prioritize the right work for the business.

Pair your priority matrix with a task management tool

Using the priority matrix to sort through your tasks is an important step, but only the first one. Now that you know what to do first, it’s time to get to work. When you pair your priority matrix with a task management tool , you’ll feel supported through your workflow from start to finish. Aside from mastering project prioritization, Asana lets you track tasks, delegate subtasks, and set deadlines to make sure projects get done on time.

Related resources

How to use a feasibility study in project management

How to track utilization rate and drive team profitability

How to accomplish big things with long-term goals

Smooth product launches are simpler than you think

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