Internal External Matrix: Steps to Prepare Internal External Matrix

The matching stage of strategy formulation includes an important matrix called the internal external matrix (IE). It is similar to both the internal factor evaluation (IFE) matrix and the External Factor Evaluation (EFE) matrix. The outcomes of external & internal positions and weighted scores are plotted on it. There are nine cells of the Internal External Matrix (IE).

Characteristics of  Internal-External Matrix

• The position of various divisions of an organization is categorized in a nine-cell display.
• The internal external matrix (IE) is much similar to the Boston Consulting Group matrix but there are certain differences like the IE matrix needs much information about the divisions. Another difference is that there are separate implications for every kind of matrix.
• Two basic dimensions are included in the internal external matrix. First is that on the x-axis total weighted scores of the Internal Factor Evaluation Matrix are specified. The second one is that on the y-axis the total weighted score of the External Factor Evaluation Matrix is specified.

There are three main regions of the IE matrix which are as follow

1. Grow & Build Region which covers the I, II, or IV cells
2. Hold & Maintain Region which covers the III, V, or VII cells
3. Harvest or Divest Regions which cover VI, VIII, or IX cells

Steps to Prepare Internal External Matrix

Certain steps should be followed to prepare an internal external matrix. These steps are described below.

1. Two key dimensions provide the basis of the IE matrix. These dimensions are the EFE matrix & IFE matrix because all the input data is obtained from these two matrices to proceed to the IE matrix.
2. The total weighted score of the IFE matrix is plotted on the x-axis while on the y-axis the total weighted score of the EFE matrix is plotted.
3. The x-axis portion of the IE matrix includes the total weighted score of the IFE matrix. The total weighted score from 1.0 to 1.99 indicates that the internal position of the organization is weaker. The total weighted score of 2.0 to 2.99 represents that the internal position of the organization is on average. While the total weighted score of 3.0 to 4.0 indicates that the internal position of the organization is stronger enough.
4. The y-axis portion of the IE matrix includes the total weighted score of the EFE matrix. The total weighted score of 1.0 to 1.99 represents the low level. The medium range is represented by the score 2.0 to 2.99. While the total weighted score of 3.0 to 4.0 is regarded as high.
5. There are three main regions of the IE matrix and each region indicates different actions to be taken. These three regions are as follows.
   1. Grow & Build Region which is specified through I, II & IV cells of the IE matrix
   2. Hold & Maintain Region which is covered by the III, V, or VII cells of the IF matrix
   3. Harvest or divest region which is covered through the VI, VIII, or IX cells of the IE matrix

Richard DanielsAuthor at Business Study Notes

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