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The Competitive Profile Matrix

The document discusses the Competitive Profile Matrix (CPM) tool used to compare competitive rivalry between firms. The CPM first identifies critical success factors (CSFs) for an industry and rates each company on strengths for each CSF. This results in a scorecard showing each company's strength or weakness on each CSF and which overall is most and least effective. The document provides an example CPM comparing three companies - Caterpillar, John & Deer, and Komatsu Ltd. - on 16 weighted CSFs. The CPM results show Caterpillar is most effective overall but there is high competition between all three, and each company excels on certain CSFs compared to the others.

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Om Prakash
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141 views1 page

The Competitive Profile Matrix

The document discusses the Competitive Profile Matrix (CPM) tool used to compare competitive rivalry between firms. The CPM first identifies critical success factors (CSFs) for an industry and rates each company on strengths for each CSF. This results in a scorecard showing each company's strength or weakness on each CSF and which overall is most and least effective. The document provides an example CPM comparing three companies - Caterpillar, John & Deer, and Komatsu Ltd. - on 16 weighted CSFs. The CPM results show Caterpillar is most effective overall but there is high competition between all three, and each company excels on certain CSFs compared to the others.

Uploaded by

Om Prakash
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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The Competitive Profile Matrix (CPM): CPM is the tool which is used to compare the competitive

rivalry between the firms based upon their strength and weakness. The first step is to identify the
critical success factor (CSF) of the industry and rating of each company based upon the strength and
opportunities of the firm and then evaluation of the scorecard based upon each CSF. The result against
each CSF shows companys strength or weakness against each CSF. The ultimate result shows that
which company is more effective and which company is less effective compare to others in the
industry.
Assumptions made to prepare CPM matrix: All the data into the matrix is assumed based upon the
knowledge background of the companies.
CSF Parameters
Critical Success Factor
Brand reputation
Distribution Channel & network
After sale service
List of Assets
Range of products
Durability of the products
Level of product integration
Successful new introductions
Market Share
Sales per employee
Low cost structure
Variety of distribution channels
Customer retention
Strong online presence
Successful promotions
Total

Weight
0.1
0.1
0.1
0.1
0.1
0.05
0.05
0.05
0.05
0.05
0.05
0.05
0.05
0.05
0.05
1

Caterpillar Inc
Rating
Score
4
0.4
4
0.4
3
0.3
4
0.4
3
0.3
3
0.15
4
0.2
3
0.15
3
0.15
2
0.1
3
0.15
3
0.15
3
0.15
2
0.1
3
0.15
3.25

John & Deer


Rating Score
3
0.3
2
0.2
2
0.2
3
0.3
2
0.2
2
0.1
3
0.15
2
0.1
2
0.1
3
0.15
2
0.1
2
0.1
2
0.1
3
0.15
2
0.1
2.35

Komatsu Ltd
Rating Score
2
0.2
3
0.3
4
0.4
2
0.2
1
0.1
1
0.05
2
0.1
1
0.05
1
0.05
1
0.05
4
0.2
1
0.05
1
0.05
4
0.2
1
0.05
2.05

Based upon the result of the CPM it is clear the Caterpillar is more effective than other two companies
but the competition is high between all three completions. There are few CSF where John and deer
excels compare to other two companies. And also there are few CSF where Caterpillar excels compare
to other two companies.

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