The Ansoff matrix is a useful tool in assessing which strategy to follow in order to achieve the objectives of the firm.
Once the different strategies have been identified, the firm should start the analysis by using the technique of a Gap Analysis. Simply stated a Gap Analysis is the supposition that if a Corporate ‘Definition of Victory’ or financial objectives are greater than its cumulative forecasts (of the different strategies) then a gap exists which must be filled.
The timescale for the analysis is determined as is the type of analysis e.g. revenue gap in value.
The forecasts for the various strategies are then plotted on the graph and the overall gap is then analysed and possible courses of action considered – these could include reducing the financial objectives downwards, expanding the strategic portfolio for additional segment opportunities, re-thinking the strategic portfolio, revising the forecasts for some or all of the units upwards.