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Fig. 8-4: Grand Strategy Selection Matrix

Overcome Weakness

Maximize Strengths

Vertical integration

Conglomerate

diversification

Horizontal integration

Concentric diversificationJoint venture

Turnaround or

retrenchment

DivestureLiquidation

Concentrated growth

Market developmentProduct development

Innovation

Internal(redirected

resources

within the

firm)

External(acquisition or

merger for

resource

capability)

I

IV III

II

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Fig. 8-5: Model of Grand Strategy Clusters

Rapid Market Growth

Slow Market Growth

Reformulation of concentrated

growth

Horizontal integration

Divestiture

Liquidation

Turnaround or retrenchment

Concentric diversification

Conglomerate diversification

Divestiture

Liquidation

Concentrated growth

Vertical integration

Concentric diversification

Concentric diversification

Conglomerate diversification

Joint ventures

Strong

Competitive

Forces

Weak

Competitive

Forces

I II

IIIIV

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Fig. 9-1: The BCG Growth-Share Matrix

Cash Generation (market share)

High Low

High

Low

Cash

Use

(growth

rate)

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Fig. 8-5: BDCs Growth/Share Matrix

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Fig. 9-1: The BCG Growth-Share Matrix

Market Share

Sales relative to those of

other competitors in the

market (dividing point is

usually selected to have

only the two-three largest

competitors in any marketfall into the high market

share region)

Growth Rate

Industry growth rate in

constant dollars (dividing

point is typically the

GNPs growth rate)

Description of Dimensions

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Fig. 9-3: Industry Attractiveness-Business

Strength Matrix

IndustryAttractiveness

High LowMedium

High

Medium

LowBus

inessStrengt h

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Fig. 9-3: Industry Attractiveness-Business

Strength Matrix

Industry Attractiveness

Subjective assessmentbased on broadest

possible range of external

opportunities & threats

beyond the strict controlof management

Business Strength

Subjective assessmentof how strong a

competitive advantage is

created by a broad range

of the firms internalstrengths & weaknesses

Description of Dimensions

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Fig. 9-4: The Market Life-Cycle Competitive

Strength Matrix

Stage of Market Life Cycle

Introduction Growth Maturity Decline

Low

M

oderat e

High

Compe titiveStrength

Push:

Inves

t

Aggre

ssivel

y

Cautio

n:Inv

est

Sele

ctively

Dang

er:Harve

st

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Fig. 9-4: The Market Life Cycle - Competitive

Strength Matrix

Stage of Market Life Cycle

See page 197

Competitive Strength

Overall subjective rating,based on a wide range

of factors regarding the

likelihood of gaining &

maintaining a competitiveadvantage

Description of Dimensions

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The business unit competitive position

Strong Average WeakFig. 8-10: The Life-

Cycle Portfolio Matrix

Development

Growth

Competitive

shakeout

Maturity

Decline

Saturation

TheIndust

rysstageintheevolutionarylife

cycle

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Fig. 8-7: The GE Nine-Cell

Planning Grid

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