General Electric (GE) Matrix

Roadmap For The

Presentation
ROADMAP

ABOUT GE MATRIX

CLASSIFICATION

STRATEGIES

BCG VS GE MATRIX
 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 awareness.
 ABOUT GE MATRIX

 Developed by general electric & Company in

1970’s.
 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.
 Also called the nine cell matrix and stop light model.
 Classification
Business Strength
Strong Medium Weak
Market Attractiveness

High
Medium
Low
 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
 Strategies
Leader Growth

LEADER
• Protect position
Try Hard
•Invest to grow
• Effort on maintaining strength

GROWTH
• Challenge for leadership
• Remove weaknesses
• Build selectively on strength

TRY HARD
• Invest in most attractive segment
• Invest in selected segments
• Seek new segments to apply strength.
• Build up ability to counter competition
• Emphasize profitability by raising productivity
 Strategies
4. Protect & Refocus 6
• Manage for current earning
• Defend strength
5
5. Selectivity for Earning 4
• Protect existing program
• Make contingency programs to protect your position.
• Investments in profitable segments

6. Build Selectively
• Seek niche market or specialization
• Seek opportunities to increase strength
• Withdraw if indication of sustainable growth are lacking
 Strategies
7. Limited Expansion
•Boost cash flow as you exit the market
•Look for ways to expand
without high risk
7
8. Manage for Earnings
• Protect position in profitable
segment 8 9
• Shift resources to more attractive segments.
• Minimize investment

9. Exit
• Sell at time that will maximize cash value
• Exit the market
• Prune the product line
 Study of TATA
 TATA
• IT (Information Technology) : TCS
• Consumer Durable : Automobiles,
Titan,jewellery etc.
•Textiles : Tata Fabrics.
 GE Matrix For TATA

Strong Weak
Business Strengths
High
IT Consumer
Durables
Attractiveness
Market

Low
Textiles
 Tata consultancy services
 Number one software company in Asia.
 The Tata Group has earned the reputation of being the leader in
quality, innovation and unmatched customer service.
 Provides business solutions and consultancy services.

 TCS offers a wide range of IT services, outsourcing and

business solutions.
 Also provides services like engineering and industrial services,
business process outsourcing etc.
 Consumer durables
 Consumer products: The Tata group has a strong and
longstanding business in watches and jewellery, and a
growing presence in the retail industry.
 Some of the famous tata products and services are tata

salt,tata ceramics, titan watches,tata sky, indigo airlines

have a good market share and are still growing.
 Tanishq jewellery as we all know is a brand name in

itself.
 Tata textile
 TATA Group is also into the textile business
but it is not that successful and need to grow
and use the resources more carefully.
 Like the other tata products ,the tata fabric is
not so popular and most of the people are not
even aware of the fact that tata is into the
textile industry.
 BCG & GE Matrix
Relative Position
Business Strength
(Market Share)

Market Attractiveness
Market Growth
 BCG vs. GE

BCG GE

Market Growth
Market Attractiveness

Market share
Market strength
4 cell 9 cell
Multi Products
Multi Business Units
 Advantages of GE matrix
 Wide variety of variables are used.
 Help the companies to develop feasible
strategic alternatives.
 Better understanding of a business.

 To channel the corporate resources to business.

 Disadvantages
 Assessment of business in two variables can
be misleading.
 Numerical value can not be assigned to these
two variables properly.
 Relation between the market share and cost
saving is not directly proportional.