What is GE matrix:
What is GE matrix The multi factor portfolio planning matrix propagated by G eneral Electric (GE) holds that a company can appropriately rate its different businesses for the purpose of strategic planning, on the basis of two main parameters. Industry attractiveness Company’s business strength.
HOW ATTRACTIVE IS THE INDUSTRY:
HOW ATTRACTIVE IS THE INDUSTRY Every firm desires to stay in the most attractive industries and excel through its distinctive strengths and if not the business is rated as the least important one. The other businesses will occupy a position somewhere between the two extremes this is the basic approach of the GE model
FACTORS UNDERLYING THE PARAMETERS:
FACTORS UNDERLYING THE PARAMETERS Industry attractiveness is the product of several factors such as industry potential,the current size of the industry,the rate of growth of the industry,the industry structure and the profitability of the industry. Likewise,company’s business strength is the product of several factors such as company’s current market share, growth rate, differentiation strength,brand image, corporate image, etc.
CONTINUE…:
CONTINUE … Each firm will have to identify the factors specific to its industry and its competitive position. It has to also assign due weightages to each of the factors and find out the weighted measures in respect of the two parameters, viz., market attractiveness and firms business strength
DIAGRAM OF GE MATRIX:
DIAGRAM OF GE MATRIX
DIFFERENCE BETWEEN BCG AND GE MODEL:
DIFFERENCE BETWEEN BCG AND GE MODEL BCG model goes by industry growth and company’s business strength. BCG is a growth share matrix GE model goes by industry attractiveness and company’s business strength. GE model is an enlarged version of the BCG model.