GE MATRIX
Submitted By:- Submitted
Snehalata Magar To :Priya
Ramachandran
Pavithra Powar
Avinash Kumar
BCG Matrix
BCG MATRIX
It is developed by Boston consultancy group in 1972.It is also
known as growth share matrix.
STAR-Needs a good deal of investment support as it operates in a
high growth market. They are at a peak of product life cycle, and
star indicates a great potential for future.
Mark-in this the future is uncertain, they are in high risk zone
Cash cow-Cows are generators of resources, it brings a lot of cash.
Does not require investment as it is in low growth market.
Dog-They are in low growth market and low market share. They
actually blocks capital of the company.
Advantages Of BCG
Model is simple and easy to understand.
BCG is applicable to large companies that seek
volume and experience effects.
BCG Model is helpful for managers to evaluate
balance in the firms current portfolio.
Limitations
High market share is not the only success
factor
Market growth is not the only indicator for
attractiveness of a market
Sometimes Dogs can earn even more cash
as Cash Cows
Firms with small market share can be
highly profitable.
General Electric (GE) Matrix
ABOUT GE MATRIX
Developed by McKinsey &
Company in 1970’s.Also
known as Spotlight Matrix.
GE is a model to perform business
portfolio analysis on the SBU’s.
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
High
Medium
Low
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.
Harvest/Dives: 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 and
advertising, the objective is to earn short term profit.
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 Weak
Business Strengths
High
IT Consumer
Durables
Attractiveness
Market
Low
Textiles
BCG & GE Matrix
Relative Position
Business Strength
(Market Share)
Market Attractiveness
Market Growth
BCG v/s GE
BCG GE
Market Growth
Market Attractiveness
Market share
Market strength
4 cell 9 cell
Multi Products
Multi Business Units
Primary tools
Secondary tools
THANKING YOU
