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GE Matrix

The GE Matrix is a strategic planning tool developed by McKinsey & Company in the 1970s to analyze business units within a company. [1] It evaluates each business unit based on its "Market Attractiveness & Business Strength" and places them into one of nine cells in the GE Matrix grid. [2] The grid helps determine the appropriate strategic approach for each business unit, whether to invest/expand, select/earn, or harvest/divest, depending on its positioning on the grid. [3] The GE Matrix provides a more sophisticated analysis than the BCG Matrix by evaluating multiple business units across nine cells rather than four for a single product in the BCG Matrix.

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1K views16 pages

GE Matrix

The GE Matrix is a strategic planning tool developed by McKinsey & Company in the 1970s to analyze business units within a company. [1] It evaluates each business unit based on its "Market Attractiveness & Business Strength" and places them into one of nine cells in the GE Matrix grid. [2] The grid helps determine the appropriate strategic approach for each business unit, whether to invest/expand, select/earn, or harvest/divest, depending on its positioning on the grid. [3] The GE Matrix provides a more sophisticated analysis than the BCG Matrix by evaluating multiple business units across nine cells rather than four for a single product in the BCG Matrix.

Uploaded by

Suhas. V.b.
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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GE MATRIX

Submitted By:Snehalata Magar Pavithra Powar Avinash Kumar

Submitted To :Priya Ramachandran

General Electric (GE) Matrix

ABOUT GE MATRIX
Developed by McKinsey &

Company in 1970s.Also known as Spotlight Matrix. GE is a model to perform business portfolio analysis on the SBUs. GE is rated in terms of Market Attractiveness & Business Strength It is an Enlarged & Sophisticated version of BCG.

STRATEGIC PLANNING
It is the

management task concerned with the growth and future of business enterprise.
It provides the route

map for the firm and helps to take decision in the future with a greater

GE Nine-cell Planning Grid:Business Strength


Strong Medium Weak

Market Attractiveness

Low

Medium

High

GE nine-cell Planning Grid: Zone

Strategic Signal
Green
Invest/Expa nd

Yellow

Select/Earn

Red

Harvest/Divest

GE Nine-cell Planning Grid: Invest/ Expand: In this Zone there is


opportunity to Grow through further Investment & Expansion. This zone is characterized by high business strength & high industry attractiveness which is a Ideal situation for growth. How ever this situation does not remain for a long time. Example: Initially IT industry most attractive but later on it was facing competition from all sorts of place.

Select/Earn

: This zone presents a mix situation in which growth possibility is low. However its presents a opportunities for selective earning. In the case of red-cell organization has to stop. In this case Harvesting or Divesting strategies suitable. Harvesting means withdraw from a business but withdrawal is not immediate. Initially focus is on cost-cutting i.e In R&D

Harvest/Dives:

Market Attractiveness
Annual market growth

rate Overall market size Historical profit margin Current size of market Market structure Market rivalry Demand variability Global opportunities

Business Strength
Current market share Brand image Production capacity Corporate image Profit margins relative to competitors R & D performance Promotional effectiveness

Study of TATA
TATA IT (Information Technology) : TCS Consumer Durable : Automobiles, Titan etc. Textiles : Tata Fabrics, West Sides etc

GE Matrix For TATA


Strong High IT

Business Strengths
Consumer Durables

Weak

Market Attractiveness
Low

Textiles

BCG & GE Matrix


Relative Position Market Attractiveness (Market Share) Market Growth Business Strength

BCG v/s GE BCG


Market Growth Market share 4 cell Multi Products Primary tools

GE
Market Attractiveness Market strength 9 cell Multi Business Units Secondary tools

THANKING YOU

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