Accurate and effective assessment of strategic alternatives of an organization directly affects the decision-making and execution of its deve1opment strategy. In evaIuation of strategic alternatives , relevant elements from both interna1 and external environments of an organization must be considered. In this paper we use strategic assessment model to evaluate strategic alternatives of an air-conditioning company. Strategic objectives and alternatives of the company are developed through analysis of the competitive environment, key competitors and internal conditions. The environment factors are classified into internal, task, and general opportunities and threats. Ana1ytical hierarchy process, subjective probabilities, entropy concept, and utility theory are used to enhance decision-maker's ability in evaluating strategic alternatives. The evatuation results show that the most effective strategic alternative for the company is to reduce types of products, concentrate its effort on producing window-type and cupboard-type air-conditioners, enlarge the production scale, and pre-empt the market. The company has made great progress by implementing this alternative. We conc1ude that SAM is an appropriate tool for eva1uating strategic alternatives. Accurate and effective assessment of strategic alternatives of an organization directly affects the decision-making and execution of its deve1opment strategy. In evaIuation of strategic alternatives, relevant elements from both interna1 and external environments of an organization must be considered. In this paper we use strategic assessment model to evaluate strategic alternatives of the air-conditioning company. Strategic objectives and alternatives of the company are developed through analysis of the competitive environment, key competitors and internal conditions. The environment factors are classified into internal, task, and general exists . Ana1ytical hierarchy process, subjective probabilities, entropy concept, and utility theory are used to enhance decision-maker's ability in evaluating strategic alternatives. The evatuation results show that the most effective strategic alternative for the company is to reduce types of products, concentrate its effort on pro ducing window-type and cupboard-type air-conditioners, enlarge the production scale, and pre-empt the market. The company has made great progress by implementing this alternative. We conc1ude that SAM is an appropriate tool for eva1uating strategic alternatives.