Strategic Management Assignment - II

Subject: Strategic Management

Division: C
Group Number 4

Name SAP ID Roll Number

Devarshi Kansara 80012100067 H014
Mannat Dogra 80012100575 H123
Rogers Mathews 80012100173 H038
Sunaina Baijal 80012100304 H061
Surbhi 80012100410 H091
 Hamleys

Contents
The Hamleys Story .......................................................................................................................... 3
Analysis ........................................................................................................................................... 3
1. Pestel analysis ...................................................................................................................... 3
2. Swot analysis: ....................................................................................................................... 5
3. Porter's Five Forces Analysis: ............................................................................................... 5
4. Value Net Analysis ............................................................................................................... 6
5. Internal Factor Evaluation Matrix (IFE Matrix) .................................................................... 8
6. External Factor Evaluation Matrix (EFE Matrix) ................................................................... 9
7. Internal External Matrix ..................................................................................................... 10
Hamleys Internal External Matrix ..................................................................................... 11
8. Quantitative Strategic Planning Matrix (QSPM) ................................................................ 11
9. Competitive Profile Matrix (CPM)...................................................................................... 13
10. Space Matrix ................................................................................................................... 15
11. BCG Matrix ..................................................................................................................... 18
12. Grand Strategy Matrix .................................................................................................... 21

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 Hamleys

The Hamleys Story

Anyone who has been to a Hamleys store understands that it is much more than a store. It's a
once-in-a-lifetime opportunity to combine history and fun. This is how it happened.

William Hamleys, a Cornishman from Bodmin, England, started a toy shop in Holborn, London in
1760 with the goal of making it "the best toy shop in the world!" He had no idea that this was
only the beginning of something monumental.

William Hamleys could never have envisaged how far and wide Hamleys would reach in his
wildest fantasies. Today, there are 170 Hamleys stores in over 18 countries, including the United
Kingdom, India, the United Arab Emirates, China, and Russia, where children can choose from a
wide range of high-quality toys.

Every Hamleys store provides a fantastic experience for youngsters, as well as a once-in-a-
lifetime opportunity for adults to relive their childhood. It's where they can connect with their
favorite toy characters, play with toys, and watch live demos of toys.

The Hamleys promise:

● Easy returns
● Quality Assurance
● Free Delivery

Analysis
1. Pestel analysis
a. Political
The frequent changes in product and safety criteria in the UK have an impact on Hamleys.
Capitalist enterprise is encouraged and energised since the legislature is involved in securing and
supporting the development of its kin and environment. The gold coast's territory is particularly
well-known for its surfing, exquisite dining, and easy access to regular areas of the surrounding
districts.
b. Economical
As a result of lower income during the recession, Hamleys sales dropped by a significant amount.
The economic trends in the United Kingdom have shown that the expansion rates and the
country's economic development levels are at odds. The expansion of the UK economy has had
a significant impact on the country's economic progress throughout the last many decades
(Downey 2004). Above all, the rise in inflation rates caused by a general increase in the costs of
goods and services like clothing, power, gasoline, and groceries has remained a major contributor

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to the UK's stagnant economy, as evidenced by figures during the severe depression and money-
related crisis.
c. Social
In most circumstances, changing customer tastes have an impact on the number of sales made
as well as inventory write-downs. The surrounding social climate is extremely favorable to
tourism; the city boasts the largest biodiversity of any city in the United Kingdom, making it a
highly desired destination for people seeking a biological immersion. The range's surroundings
Changes in the population development of the age group between 15 and 60 years a considerable
impact on the general rate of livelihood in a given economy. In the case of the United Kingdom,
the faster development of a dynamic population imposes enormous pressure to generate an
extended livelihood, resulting in a housing boom throughout the economy.
d. Technological
Electronic chips and technology have also become more expensive. In addition, new IT business
technologies are being introduced to assist Hamleys Toy Store administration. However,
innovation is advancing throughout the United Kingdom, particularly in densely populated urban
and suburban areas such as the coast. The fast internet is readily available, mobile service is
reliable, server capacity among service providers is high, and the general subject's ability to
employ innovation is high. The ability for businesses to have global outlets for advertising and
marketing strategies is positively high; an industry like lodging and tourism in the city and district
of the Gold Coast would benefit from the best innovation available on the planet today to
broadcast operations to potential visitors around the world.
e. Environmental
The success and positivity of a market excursion in this country and location are directly related
to environmental elements. Environmental rules in the United Kingdom are strict, and operators
are held to high accountability standards for environmental issues of safety, such as effects of
operations on the environment, the operation's personnel, and leaving the industry with minimal
repercussions (Williams 2015). The country also encourages the development of ecotourism in
the region. Bringing in a legal representative to fully explain the rights and obligations of any
future administrator on the coast is a sensible idea.

f. Legal
This section's analysis is thought to be optimal in terms of the political and economic climate of
the nation and territory. Any legal difficulties, as well as environmental issues, should be
thoroughly studied with a trained environmental expert prior to participating in any biological
business operations in the UK's gold coast region.

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2. Swot analysis:
a. Strength
• Brand recall is very high
• One of the world's biggest toy retail chains
• Has a good customer reach and has a wide variety of toys?
• Has a presence all over the world
• Has survived the test of time and has its presence in the world’s most important
metros
• Good focus on customer experience adds value
b. Weakness
• Shops located in the upscale market
• Targets mainly the upper class
c. Opportunities
• Target the middle class in the developing economies
• Can add more product lines to its portfolio
d. Threats
• Other retail toy stores
• Outdoor games
• Television
• Computer games and Internet

3. Porter's Five Forces Analysis:

Bargaining Power of Suppliers
The power of suppliers is limited, yet it is significant for the reasons that follow. On the market,
there are enough vendors to deal with close by. On the other hand, because the delivery period
for a whole prepared game is so extensive, Hamleys is unable to change suppliers if the price
changes quickly.

Bargaining Power of Customers

When it comes to Hamleys, the customer has a significant impact on the company and significant
bargaining power (Ventures 2011). They can go to one of the competitors that offer similar
products if the pricing, quality, or design are not right for them.

Threats of new entrants

Low brand awareness and the massive players in the branch that make the most of customers'
image unwaveringly are two threats that emerge when entering a new market. The Hamleys toys
will be unknown, and the organization will be unknown as well. The merchandise company must

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deal with the risk of new entrants, but by standing out from the competition by updating the
questionnaire cards, it is possible to gain an advantage.

Threats of Substitutes
The organization must deal with the power of substitutes. The organization provides a legal
pastime that is tough to obtain. Customers may migrate to a substitute of larger enterprises that
can supply at a lower cost if they find the product's price to be too high. As a result, Hamleys
would lose a customer, which would have a negative impact on sales and profit.

4. Value Net Analysis

It is better for competitors to collaborate rather than compete against each other. They use a
combination of business strategy and Game Theory to argue that it is better for competitors to
collaborate rather than compete against each other. The Value Net Model, which is essentially a
development of Porter's Five Forces Model, integrates the advantages of both competition and
cooperation into a new dynamic model termed co-opetition (or coopetition). Porter's Five Forces,
in their opinion, focused almost solely on rivalry and failed to account for an industry's
collaborative potential. When businesses collaborate, they can build a far larger and more
valuable market than they could if they worked alone. As a result, industry players should
concentrate on 'expanding the pie' rather than 'splitting the pie'.

Fig 1: Value Net Analysis

Customers, Suppliers, Competitors, and Complementors are the four sorts of stakeholders that
any company faces and who might have a direct impact on your business, according to the Value
Net. Even competitors, each of these sorts of actors, including competitors, present potential for

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collaboration with your organization. It's worth noting that a single player can perform many
roles (e.g., a company can act as both a Supplier and a Competitor).

Customers
Customers are individuals or groups who purchase your goods or service. Money is sent from the
client to the focus company in exchange. A corporation doesn't have much of a purpose to exist
if it doesn't have customers. More customers equal more revenue, which equals a bigger market
share. Kids of various ages are the consumers of the Hamleys products but the customers of the
Hamleys products are affluent urban families in tier 1 and tier 2 cities who want the toys for their
children’s or want to give to others children.
Suppliers
Suppliers are the people or companies who give your business the resources it needs to
manufacture or sell its final products. They are significant external elements to consider since
suppliers have the ability to raise prices and/or lower the quality of purchased inputs. As a result,
it's critical to maintain solid relationships with suppliers or distribute risk by having numerous
suppliers to pick from. Suppliers to Hamleys are toy manufacturers: Marvel, Hamleys own
manufacturing, Nerf, Lego, Barbie, Hot wheels, LOL, Fisher Price, Disney.

Competitors
Competitors are companies that target similar clients with similar products or services in order
to compete for the same market share as you. Companies, on the other hand, frequently view
competition through a narrow lens, failing to anticipate potential dangers. Competitors of
Hamleys are FAO Schwarz, Letterbox Children’s Toys, Early Learning Center, Learning Express,
MasterMind Toys, Smyths Toys Group, Toys’R’Us, Hawkin’s Bazaar.

Complementors
This is one of the Value Net categories that many business owners and managers overlook. This
category comprises firms who offer (complementary) items or services that could combine well
with your own products to make the end result more appealing to consumers, rather than
competitors. Complementors of Hamleys are Kids apparel manufacturers (The Little Shop), Kids
footwear manufacturers (The Mom Store), Kids Learning Resources, Kids Health Care, Kids Area
in Hotels & Restaurants, Kindergarten School, Kids Day/Boarding School & Hostel.

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5. Internal Factor Evaluation Matrix (IFE Matrix)

An Internal Factor Evaluation (IFE) Matrix is a strategy formulation tool that summarizes and
evaluates the major strengths and weaknesses in a company's functional areas, as well as serving
as a foundation for identifying and evaluating relationships between them. The development of
an IFE Matrix necessitates intuitive judgments, so the appearance of a scientific approach should
not be taken to imply that this is an all-powerful technique. More important than the actual
numbers are a thorough understanding of the factors involved.

Table 1: Internal Factor Evaluation Matrix

An Internal Factor Evaluation (IFE) Matrix is developed by following the below mentioned steps:
a. Listing the key internal factors which includes the factors that are strengths and
weaknesses of Hamleys.
b. Assigning a weight that ranges from 0.0 (not important) to 1.0 (very important) to each
factor. The weight assigned to a given factor indicates the relative importance of the factor
to being successful in the firm’s industry. Regardless of whether a key factor is an internal
strength or weakness, factors considered to have the greatest effect on organizational
performance is assigned the highest weights. The sum of all weights must also equal 1.0.
Here, we have given highest weight i.e., “0.2” to customer experience and target market as
these two factors play an important role for making a company successful. All other factors
have been assigned a weight of “0.1”
c. Assigning a 1 to 4 rating to each factor to indicate whether that factor represents a major
weakness (rating = 1), a minor weakness (rating = 2), a minor strength (rating = 3), or a
major strength (rating = 4). Ratings are thus company based, whereas the weights in Step
2 are industry based. Accordingly, we have assigned weights to each factor

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d. Multiplying each factor’s weight by its rating to determine a weighted score for each
variable.
e. Sum the weighted scores for each variable to determine the total weighted score for the
organization. Here, as we can see in the table, we have received a total weighted score of
“2.9”

6. External Factor Evaluation Matrix (EFE Matrix)

Economic, social, cultural, demographic, environmental, political, governmental, legal,
technological, and competitive information can all be summarized and evaluated using an
External Factor Evaluation (EFE) Matrix. The EFE Matrix shows whether a company can effectively
take advantage of current opportunities while minimizing external threats. Similarly, it will assist
strategists in developing new strategies and policies based on the company's current position.

Table 2: External Factor Evaluation Matrix

An External Factor Evaluation (EFE) Matrix is developed by following the below mentioned steps:
a. Listing the key external factors which includes the factors that are opportunities and threats
to Hamleys.
b. Assigning each factor, a weight that ranges from 0.0 (not important) to 1.0 (very important).
The weight indicates the relative importance of that factor to being successful in the firm’s
industry. Here, we have assigned highest weights to the opportunities as those are the
factors that are really important for the company to keep succeeding.
c. Assigning a 1 to 4 rating to each key external factor to indicate how effectively the firm’s
current strategies respond to the factor, where 4 = the response is superior, 3 = the
response is above average, 2 = the response is average, and 1 = the response is poor:

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Ratings are based on effectiveness of the firm’s strategies. Ratings are thus company based,
whereas the weights in Step 2 are industry based.
d. Multiply each factor’s weight by its rating to determine a weighted score.
e. Sum the weighted scores for each variable to determine the total weighted score for the
organization. Here, as we can see, we have received the total weighted score of “2.65”

7. Internal External Matrix

Fig 2: Internal External Matrix

The Internal-External (IE) Matrix is a nine-cell matrix that positions an organization's numerous
divisions. The IE Matrix is a strategic management tool that is used to assess the existing state of
divisions and provide future plans.

The Internal-External (IE) Matrix is based on a combination of internal and external business
aspects that are analyzed and merged into a single suggested model. The EFE and IFE matrix
concepts are combined to form the IE matrix.

The IFE total weighted scores on the x axis and the EFE total weighted scores on the y axis form
the basis of the Internal-External (IE) Matrix. The corporate-level IE Matrix is built using the total
weighted scores collected from the divisions. On the IE Matrix's x axis, an IFE total weighted score
of 1.0 to 1.99 indicates a weak internal position; 2.0 to 2.99 indicates average; and 3.0 to 4.0

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indicates strong internal position. On the y axis, an EFE total weighted score of 1.0 to 1.99 is
regarded low, 2.0 to 2.99 is considered medium, and 3.0 to 4.0 is considered high.

The Internal-External (IE) Matrix is organized into three major categories, each with its own set
of strategic implications. To begin, the divisions in cells 2, 3, and 6 can be summarized as "grow
and build." These divisions may benefit from intensive (market penetration, market
development, and product creation) or integrative (backward integration, forward integration,
and horizontal integration) techniques. Second, hold and maintain strategies are best for
divisions that fall within cells 1, 5, and 9; market penetration and product development are two
popular tactics for these divisions. Harvest or divest is a common recommendation for divisions
that fall under cells 4, 7, and 8.

Hamleys Internal External Matrix

Fig 3: Hamleys IE Matrix

Hamleys fall under the second category – Hold and maintain

8. Quantitative Strategic Planning Matrix (QSPM)

The Quantitative Strategic Planning Matrix (QSPM) is a strategic management tool for evaluating
strategic options and determining relative strategy attractiveness. The QSPM method determines
which of the selected strategic options is feasible and prioritizes these options. A fundamental
tenet of the QSPM is that businesses must systematically assess their external and internal

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environments, conduct research, carefully weigh the benefits and drawbacks of various options,
conduct analyses, and then choose a course of action.

Table 3: Quantitative Strategic Planning Matrix

Here,
AS = Attractiveness Score
TAS = Total Attractiveness Score
The steps required to develop a Quantitative Strategic Planning Matrix (QSPM) are discussed
below:
a. Making a list of the firm’s key external opportunities/threats and internal
strengths/weaknesses in the left column of the QSPM. This information is taken directly
from the EFE Matrix and IFE Matrix.
b. Assigning weights to each key external and internal factor. These weights are identical to
those in the EFE Matrix and the IFE Matrix.
c. Examining the Stage 2 (matching) matrices and identifying alternative Strategies that the
organization should consider implementing. Recording these strategies in the top row of
the QSPM. The strategies which we have discussed here are: Market Penetration, Market
Development and Product and Service Development
d. Determining the Attractiveness Scores (AS), defined as numerical values that indicate the
relative attractiveness of each strategy in a given set of alternatives. Attractiveness Scores
are determined by examining each key external or internal factor, one at a time, and asking
the question, “Does this factor affect the choice strategies being made?” The range for
Attractiveness Scores is 1 = not attractive, 2 = somewhat attractive, 3 = reasonably
attractive, and 4 = highly attractive. Accordingly, we have assigned AS scores for all the

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strategies. For example: Hamleys’ store location will affect market penetration, hence, we
have allocated a score of 3 to the same. Similarly, this has been done for all the factors.
e. Computing the Total Attractiveness Scores: Total Attractiveness Scores are defined as the
product of multiplying the weights (Step 2) by the Attractiveness Scores (Step 4) in each
row. The Total Attractiveness Scores indicate the relative attractiveness of each alternative
strategy, considering only the impact of the adjacent external or internal critical success
factor. The higher the Total Attractiveness Score, the more attractive the strategic
alternative.
f. Computing the sum of Total Attractiveness Score: Adding Total Attractiveness Scores in
each strategy column of the QSPM. The Sum Total Attractiveness Scores reveal which
strategy is most attractive in each set of alternatives. Higher scores indicate more attractive
strategies, considering all the relevant external and internal factors that could affect the
strategic decisions. Here, we can see that market penetration has the highest
attractiveness score i.e., “6.35”, hence is the most attractive strategy for Hamleys.

9. Competitive Profile Matrix (CPM)

The Competitive Profile Matrix (CPM) is a tool that compares a company's strengths and
shortcomings to those of its competitors. Firms frequently utilize CPM to better understand the
external environment and competitiveness in a specific industry. The profile matrix identifies and
compares a company's top competitors based on industry vital success characteristics. In
comparison to its competitors, the study highlights the company's relative strengths and
disadvantages. As a result, a business can quickly determine which areas it should enhance and
which parts it should safeguard.

Table 4: Competitive Profile Matrix

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In above mentioned Competitive Profile Matrix (CPM) important components are:

● Competitor
● Critical Success factor
● Weight to each factor
● Rating
● Score

Competitor
From the above frameworks we got close competitors as FAO Schwarz and Toys’R’u.

Critical Success Factor

The major variables that define a company's industry success are known as critical success factors
(CSF). A business must operate at the highest level of quality in order to prosper in its industry.
These variables differ depending on the industry or even the strategic group. Internal and
external elements should be considered in the CSF. As a result, include more, relevant factors if
you want a more robust and accurate analysis. For any offline and online store combination these
factors are really important: Brand reputation, Offline presence, Online presence, Distribution
channels, new arrivals, Total range of products, Sales per employee, Successful promotion, Low-
cost structure, Market share, IT capabilities, Pricing, Customer retention.

Weightage
Each important success element should be given a weight ranging from 0.0 (low importance) to
1.0 (great importance). The relevance of that component in the company's performance is
indicated by the weight. If no weights are assigned, all factors will be equally important. In the
real world, this is an impossibility. All of the weights must add up to 1.0. By allocating a weight of
0.3 or more to different components, you should not overemphasize them. This is due to the fact
that the success of a firm is rarely driven by just one or a few elements. In above CPM 0.12 weight
is given to Brand reputation, Offline store presence, Online store presence, Distribution channel
because these are the key criteria for any customer to go and shop the product which ultimately
drives the revenue and organization.

The CPM ratings indicate how well organizations perform in each category. They range in number
from 4 to 1:

• 4 - major strength
• 3 - minor strength
• 2 - minor weakness
• 1 - major weakness

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Assign each company's ratings and weights subjectively. Benchmarking, on the other hand, can
make this process go more smoothly. Benchmarking demonstrates how well businesses are
performing in comparison to their peers or the industry average. It's important to note that firms
can get the same grade for the same factor. For example, in the above CPM brand reputation of
Hamleys is greater than rest so it is awarded 4 rating while distribution of Toys’R’Us is poor so it
is awarded 1.

Score
The score is calculated by multiplying the weight by the rating. Each factor is assigned a score to
each company. The company's total score is just the sum of all individual scores. The company
with the greatest overall score is more powerful than its competitors. The total score for Hamleys
we got is 3.59, FAO Schwarz is 3.15 and Toys’R’Us is 2.18.

Conclusion
By above analysis we as a team came to the conclusion that Hamleys need to work most on
market share and IT capabilities and improve on offline store presence and new arrivals.

10. Space Matrix

The SPACE Matrix analysis functions upon two internal and two external strategic dimensions in
order to determine the organization’s strategic posture in the industry. The SPACE matrix is based
on four areas of analysis:

Internal Strategic Dimensions

Financial Strength (FS)
Competitive Advantage (CA)

External Strategic Dimensions

Environment Stability (ES)
Industry Strength (IS)

The following are the model technical assumptions

- By definition the CA and IS values in the SPACE matrix are plotted on the X Axis
- - CA values can range from -1 to -6
- The FS and ES dimensions of the model are plotted on the Y Axis
- ES values can be between -1 and -6
- FS values can be between -1 and -6

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The following table shows what values were used to create the SPACE matrix

Each factor within each strategic dimension is rates using appropriate rating scale. Then averages
are calculated. Adding individual strategic dimension averages provides values that are plotted
on the axis X and Y.

Table 5: Space Matrix

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Conservative Aggressive
+6.00

+5.00

+4.00
Suggested
+3.00
strategy type
2.75
+2.00

+1.00

-6.00 -5.00 -4.00 -3.00 -2.00 -1.00 +6.00 +5.00 +4.00 +3.00 +2.00 +1.00

3.25

-6.00

-5.00

-4.00

-3.00

-2.00
Defensive Competitive
-1.00

Fig 4: Space Matrix

In our case we have arrived at our SPACE matrix suggesting our company Hamleys’ should pursue
an “Aggressive Strategy”. Hamleys has a strong competitive position in the market with rapid
growth. It needs to use its internal strengths to develop a market penetration and market
development strategy. This can include product development, integration with other companies,
acquisition of competitors and so on.

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11. BCG Matrix

Fig 5: BCG Matrix

The BCG Matrix for Hamleys will help brands in implementing the business level strategies for its
business units. The analysis will first identify where the strategic business units of Hamleys fall
within the BCG Matrix for Reliance Acquires Global Toy Brand Hamleys.

Stars - Soft Toys and Construction

● The financial services strategic business unit is a star in the BCG matrix of Hamleys. It
operates in a market that shows potential in the future. Hamleys earns a significant
amount of its income from the Soft Toys and Construction segment. Hamleys should
vertically integrate by acquiring other firms in the supply chain. This will help it in earning
more profits as this Strategic business unit has potential.

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● Products in the Soft Toys and Construction segment generate the greatest sales amongst
its product portfolio. The potential within this market is also high as consumers are
demanding this and similar types of products. Hamleys should undergo a product
development strategy for this segment, where it develops innovative features on this
product through research and development. This will help Hamleys by attracting more
customers and increasing its sales.
● The Number 2 brand Strategic business unit is a star in the BCG matrix of Hamleys and
has a 20% market share in this category. It is also the market leader in this category. The
overall category is expected to grow at 5% in the next 5 years, which shows that the
market growth rate is expected to remain high. Hamleys should use its current products
to penetrate the market. This could be done by improving its distributions that will help
in reaching out to untapped areas.

Cash Cows - Gaming and Lifestyle

● The Gaming and Lifestyle unit is a cash cow in the BCG matrix of Hamleys. This has been
in operation for over decades and has earned Hamleys a significant amount in revenue.
The market share for Hamleys is high, but the overall market is declining as companies
manage their supplier themselves rather than outsourcing it. The recommended strategy
for Hamleys is to stop further investment in this business and keep operating this strategic
business unit as long as it is profitable.
● This is an innovative product that has a market share of 25% in its category. The overall
category has been declining slowly in the past few years. Hamleys has the power to
influence the market as well in this category. It should, therefore, invest in research and
development so that the brand could be innovated. This will help the category grow and
will turn this cash cow into a star. The overall benefit would be an increase in sales of
Hamleys.

Question Marks - Action toys and Vehicles, Dolls and fashion

• Action toys and Vehicles, Dolls and fashion are typically growing fast but consume large
amounts of company resources. This segment should be analyzed frequently and closely
to see if they are worth maintaining. The recommended strategy for Hamleys is to invest
in research and development to come up with innovative features. This product
development strategy will ensure that this strategic business unit turns into a cash cow
and brings profits for the company in the future.
• This strategic business unit is a part of a market that is rapidly growing. However, this
strategic business unit has been incurring losses in the past few years. It has also failed in
the attempts made at innovation by research and development teams. The
recommended strategy for Hamleys is to divest and prevent any future losses from

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occurring. Hamleys has a low market share in this attractive market. The low sales are as
a result of low reach and poor distribution of Hamleys in this segment. The recommended
strategy for Hamleys is to undergo market penetration, where it pushes to make its
product present on more outlets.

Dogs - Sports and Leisure, Games and Puzzles

● The operating market in Sports and Leisure, Games and Puzzles is declining in the past 5
years. The company also has negative profits for the Sports and Leisure, Games and
Puzzles category. However, it is expected that the market will grow in the future with
environmental changes that are occurring and healthy lifestyle people are opting for after
the pandemic. The recommended strategy for Hamleys is to invest in the business enough
to convert into a cash cow. This will ensure profits for Hamleys if the market starts
growing again in the future.

Some of the strategic business units identified in the BCG matrix for Reliance Acquires Global Toy
Brand Hamleys have the potential of changing from their current classification. For example, a
dog changing into a cash cow. These have been identified in the BCG matrix of Hamleys and
recommended strategies to ensure such change have also been made.

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12. Grand Strategy Matrix

Quadrant 2 Rapid Market Quadrant 1

Growth
Weak Market Position + Strong
Market Growth Strategies:

Market Development
Product Development
Market Penetration
Horizontal/Vertical Integration
Liquidation
Divestiture

Weak Strong
Competitive Competitive
Position Position

Slow Market
Quadrant 3 Growth Quadrant 4
Fig 6: Grand Strategy Matrix

Hamleys, which is located in Quadrant II, should severely reconsider its current marketing
strategy. Despite the fact that their industry is expanding, they are unable to compete
successfully, and they must understand why their existing strategy is ineffective and how they
can best alter to increase their competitiveness. Product development, market penetration, and
market penetration are appropriate strategies for such businesses. Because Quadrant II
companies operate in a fast-growing market, an intensive approach (rather than an integrative
or diversification plan) is frequently the first option to pursue. To gain a competitive advantage
or to become the market leader, Hamleys can engage in horizontal integration, subject to
resource availability. However, if Hamleys foresee a tough competitive environment and faster
market growth than the growth of the firm, the better option is to go into divestiture of some
divisions or liquidation altogether and change the business.

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