Comments Internal factor evaluation IFE matrix is a strategy formulation tool which is used to examine the strengths and weaknesses in the functional area of a business. In IFE Matrix it is more important to thoroughly understand the factors included rather than the actual numbers. Therefore intuitive judgments are required in developing IFE Matrix. Step by step construction of IFE Matrix is given for the Wal-Mart An American public corporation that runs a chain of large discount department stores and a chain of warehouse stores.
These key external factors need to be properly summarized in order to develop an effective external factor evaluation matrix. Listing of Key External Factors Assigning of Weight to Each 0 to 1. This weight age should be represented in percentage term. But the main point of consideration in this step is that all the sum of all the factors must be equal to one.
Assigning of rating to each factor: Each factor in this step should be assigned some rating which ranges from 1 to 4.
These rating are based on the responses of organization to the factors under consideration. Multiplication of Weight of Each Factor by its Rating: This generates a weighted score.
Summing up of the Weighted Score of Each Factor: In the last step of External Factor Evaluation matrix the weighted score of each factor is summed up in order to ascertain the total weighted score for the entire organization.
The organization that has highest possible score is 4. External Factor Evaluation All the key external factors that are identified in the process of external audit are identified. The opportunities are listed first and then the threats are listed.
The relative importance of that factor is indicated by given weight in terms of being successful in the industry of the organization. Mostly higher weights are given to opportunities as compared to the threats but in certain cases threats can also be assigned higher weight when it is severe in nature.
By comparing successful competitors with the unsuccessful ones, appropriate weights can be determined. There is also another way of ascertaining the appropriateness of the weights by discussing a factor among the nominated group members and performing consensus.
But the sum of all weights that are assigned to the factors should be equal to one. When a factor has given the rating 4 then this means that the response of the strategies of organization towards that factor is superior. Similarly rating 3 reflects that the response is above average, rating 2 shows that the response is average and in case of 1 the response is poor.
As ratings are related to the strategies of the organization, therefore they are organization based. On the other hand the weighs assigned in the second step are industry based in nature. On the other hand the organization that can give the lowest possible score is always 1.
The total average score that an organization represents is equal to 2. When an organization reflects 4. The organization that shows 1.
The total weighted score of 2. There is one more important thing that the factors used in EFE matrix are more important than the weight age or rating assigned.Antonline eBay Return Policy Returning an item purchased from antonline is easy and fully automated with our "Hassle Free Return Program".
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IFE & EFE Matrices. Ovidijus Jurevicius | October 20, Print. Definition. Internal Factor Evaluation (IFE) Matrix is a strategy tool used to evaluate firm’s internal environment and to reveal its strengths as well as weaknesses.
 External Factor Evaluation (EFE) Matrix. Internal Factor Evaluation Paper Example 1: Chipotle Strengths Weight Rating Weighted Score 1.
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EFE, IFE, and CPM Matrices for Apple. Internal Factor Evaluation Matrix (IFE) Key Internal Factors Strength Nestle3/5(2). History Establishment, PlayStation release, and North American expansion (–) Sony Computer Entertainment, Inc.
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