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Ge Matrix

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Submitted By tomytoai
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In my part I want to direct your attention to the GE Market Attractiveness Competitive Position model. On the surface it appears to be very similar to the BCG matrix, but a bit more complex and detailed. The model was developed by GE with the assistance of consulting firm of McKinsey & Company in 1970.
Management can use the GE model to classify strategic business units on two factors: 1. Market attractiveness criteria * Market size and growth rate * Market entry barriers * Number and types of competitor
2. Competitive strength criteria (Business Position) * Market share and knowledge * Reputation * Distribution capability * Service quality * Innovation Capability * Cost advantage
As you can see on the slide, the matrix is separated in 9 squares and each of them applies a different strategy for a product or a product line. With the assistance of the two criteria, the weights of the relevant factors are calculated and a decision is made, which are the more important. Based on these ratings each factor is labelled as high, medium, or low with respect to (a) market attractiveness and then (b) business position. Placement of business units within the matrix provides an analytic map for managing them. With units above the diagonal, a company may pursue strategies of investment and growth; those along the diagonal may be candidates for selective investment; those below the diagonal might be best sold or liquidated.
On the next slide we have prepared a table, showing the overlaps and differences between Unilever`s business model and the GE model.
The nine-box matrix offers a systematic approach for the decentralized corporation to determine where best to invest its cash. Unilever saw big opportunity in “healthy-living” brands. They achieved high quality of the product, full satisfaction of the product purchase among customers

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