The Chinese Fireworks Industry Essay

Case Title: The Chinese Fireworks Industry

Executive Summary

An organization can only improve its functioning, if it makes itself aware of its weaknesses and then acts to correct those deficiencies. The purpose of this case is to help Jerry Yu asses how attractive the fireworks industry is and to aid in his decision-makings of investment. This case is also conducted to diagnose the key issues that the company needs to address and to suggest alternative courses of action or give recommendations.

Jerry Yu is challenged to decide whether it is worthwhile to invest in the fireworks industry considering the threats it is facing and the weaknesses of the industry.

There are only two alternative courses of action. These are to …show more content…
The matrix can be created using the following five steps:

1. Make a list of critical success factors: divided between strengths and weaknesses.
2. Assign a weight to each critical success factor. The value of these weights should be between 0 (not important at all) and to 1 (the most influential critical success factor). The total value of the weights should equal, but not exceed 1.
3. Assign a rating to each one of the critical success factors. The rating should be between 1 (minor) and 4 (major). Thus the scores are company-specific and the weights are industry-specific.
4. Multiply each factor weight with its rating this determines a weighted score for each critical success factor.
5. Sum the weighted score for each factor to find total weighted score for the company.

The External Factor Evaluation (EFE) Matrix:

1. Make a list of external factors: divided between opportunities and threats.
2. Assign a weight to each critical success factors. The value of these weights should be between 0 (not important at all) and to 1 (the most influential critical success factor). The total value of the weights should equal, but not exceed 1.
3. Assign a rating to each one of the critical success factors. The rating should be between 1 (the response is poor) and 4 (the response is superior). Thus the scores are company-specific and the weights are industry-specific.
4. Multiply each factor weight

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