Matrix ge mckinsey on the example of a company. Stages of construction of the Mackinsey matrix. An example of constructing the McKinsey matrix

An extension of the approach proposed by the BCG is the "Industry Attractiveness - Strategic Position of the Enterprise" matrix, developed by General Electric with the participation of the McKinsey consulting firm to analyze its product portfolio. In the literature on strategic management, it is found under these two names. When constructing it, the authors took into account a number of shortcomings of the matrix of the Boston Consulting Group, introduced into the analysis a much larger number of market factors and evaluation criteria.

The McKinsey matrix is also built in a two-dimensional coordinate system, the vertical axis in which represents the multifactorial vector "attractiveness of the industry (product market)", and the horizontal axis represents the competitive position of the business unit of the enterprise (product) on this market.

To assess the positions of the enterprise's products, integral indicators "good" (high), "average", "low" are used. They consist of estimates of a number of factors, the choice and calculation of which is carried out in the process of developing a matrix by an enterprise. In table. 1 shows the factors that can be used to assess the attractiveness of the product market and its competitive position (the position of the business unit of the enterprise) in this market.

It should be emphasized that according to both criteria in Table. 2 provides an indicative list of evaluation factors. In each case, their choice is determined by the enterprise itself, which allows taking into account the characteristics of each industry and each enterprise.

table 2

Factors that determine the attractiveness of the market and the strategic position of the company's products

Market attractiveness	Strategic position of the enterprise
Market size (sales volume) and its growth rate	Enterprise product market share
Sizes of market segments (characteristics of the main groups of buyers)	Share of coverage by the enterprise of the main segments of the market (groups of buyers)
Market sensitivity to prices service level, changes in external factors	Technology Level
Tendency to seasonality, cyclicity.	The level of costs and profitability of the company's products compared to competitors
The degree of influence of suppliers	The nature of the company's relationship with suppliers
Technological state	Product quality
Level of competition	The quality of enterprise management
Industry average profitability	Personnel qualification
Other factors important to the enterprise, such as economic, social, environmental or legal constraints	External image, company image and other important factors

As the name of the matrix implies, the positioning of the SEB is carried out in a coordinate system, one of the axes of which is the attractiveness of the industry in which the strategic business unit operates, and the other axis is the competitive position of the strategic business unit in its industry.

In order to determine the degree of attractiveness of the industry, you must perform the following steps.

A set of parameters is established by which the attractiveness of the industry will be assessed. Such parameters can be the intensity of competition, the profitability of the industry, the growth of the industry, its size, technological stability, etc. (see Table 1) The developers of the matrix themselves determine which parameters to take into account when assessing the industry, and what should be the degree of detail when choosing individual specific parameters.

Matrix developers give each parameter a weight of its relative importance to the firm. Those parameters that, from the firm's point of view, are most important in assessing the attractiveness of the industry are given higher weights. And, accordingly, less important - smaller weights. For ease of calculation, the weights are distributed in such a way that their sum equals one.

Each of the parameters is given an assessment of the degree of its attractiveness for the company in the evaluated industry. This assessment of the parameters is carried out depending on the extent to which the characteristic of the industry contained in the parameter carries the possibilities for achieving the goals of the company. Evaluation is carried out on a five-point scale: 5 - the most attractive, 1 - the least attractive option. For example, if the firm is looking to expand and the industry is not growing at all, then the industry growth parameter will be rated 1. This would mean that it poses a threat to the firm.

The relative importance score of each parameter is multiplied by the corresponding attractiveness score for that parameter, and all these products are added together. In total, an integral assessment of the attractiveness of the industry is obtained. The maximum industry attractiveness rating can be 5, and the minimum is 1.

In order to assess the competitive position of SEBs in their industry, the following procedure is applied.

For each industry in which the firm operates, a list of key success factors is compiled. These factors can be, for example, costs, productivity, research potential, market share, etc.

Developers determine the relative weights of factors that reflect the degree of their importance for achieving a sustainable competitive position in the industry. The sum of the weights must be equal to one.

For each SEB (product), the degree of its competitive strength in the industry is determined for each of the key success factors. The degree of competitive strength is measured from 1 to 5. If developers rate 5, then this means that for this critical success factor, the strategic business unit in its industry has a strong competitive position. If 1 is set, then the competitive position on the estimated factor is very weak.

A generalized assessment of the SEB competitive position in its industry is calculated. To do this, the relative weight of each key success factor is multiplied by the corresponding assessment of the degree of competitive strength of the strategic business unit. All received works add up. The result of the addition gives an integral assessment of the competitive position of SEB in its industry.

After an assessment of the attractiveness of the industry and an assessment of the competitive position of each SEB, a SEB positioning matrix is built. Competitive position is plotted horizontally, while industry attractiveness is plotted vertically. Each of the axes is divided into three equal parts, characterizing the degree of attractiveness of the industry (high, medium, low) and the state of the competitive position (good, medium, poor). Nine squares are allocated inside the matrix, hitting and which, when positioning SEB (products), indicates what place in the company's strategy should be given to them in the future.

Compared to the BCG matrix, it is more detailed and allows you to give not only a more detailed classification of the types of products of the enterprise, but also to consider more opportunities for the strategic choice of its activities (Fig. 3).

Fig.3 McKinsey matrix

The sales volumes of the analyzed types of products are shown on the matrix in the form of circles. Their size should correspond to the total sales of products of this type on the market. The share of the enterprise is allocated in this circle as a segment. The strategic positions of the product (business lines) with this construction of the matrix improve as it moves in it from right to left and from bottom to top.

In relation to those SEBs (products) that fell into the "Success" squares, the company must apply a development strategy. These businesses are well positioned in attractive industries, so the future clearly belongs to them. Businesses (products) that are in the "Question Mark" square may have a good future, but for this the firm must make great efforts to improve their competitive position. Businesses (products) that are in the "Profitable business" square are the source of money. They are very important for maintaining the normal life of the company. But they may die, because the attractiveness to the firm of the industry in which they are located is low.

Hitting the square Medium business”does not make it possible to unequivocally judge the future fate of the SEB. In relation to it, a decision can be made only on the basis of the analysis of the state of the entire portfolio of businesses (products). Although, to a large extent, this remark also applies to SEBs that fall into one of the three types of squares considered.

With regard to the SEB, which fell into the “Defeat” square, it should be concluded that it is in a very undesirable position, it requires a fairly quick and effective intervention in order to prevent possible serious negative consequences for the company.

For each area (segment) of the matrix, it is possible to propose options for development strategies, examples of which are presented in the form of a matrix in the figure.

Fig. 4 Options for development strategies

Matrix GE (General Electric), or McKinsey matrix (McKinsey) jointly proposed by the corporation General Electric and consulting company McKinsey&Co, is more advanced than matrix bcg, the following reasons.

1. Matrix GE/McKinsey is formed in the 3x3 format (Fig. 5.3), while the matrix BCG- in 2x2 format. Axis X and at integral assessments are given according to the attractiveness of the market (or business sector) and the relative advantage of the organization in this market (or strengths organization's business). Unlike the matrix BCG in the matrix GE/McKinsey each coordinate axis is considered as the axis of a multifactorial, multidimensional measurement. This allows you to use this matrix more productively and analytically in a more versatile way compared to the matrix BCG and at the same time makes it more realistic in terms of positioning types of business.

Rice. 5.3. Graphical representation of a matrix G.E.

2. The Industry/Market Attractiveness scale is used as a measure of industry attractiveness instead of market growth, as industry/market attractiveness includes more factors than just the market growth rate in the matrix BCG.
3. The Competitive Advantage scale replaces market share as a parameter for assessing the competitiveness of a strategic business unit, since this concept also includes more factors than just market share in the matrix BCG.

Consider the typical factors that affect the attractiveness of the market and the competitive advantage of a strategic business unit (Table 5.2).

Table 5.2

Typical Factors Affecting Market Attractiveness and Competitive Advantage of a Strategic Business Unit

Typical external factors affecting the attractiveness of the market (market attractiveness)

Typical internal factors affecting competitive advantage (competitive strength) strategic business unit

Market Size Market Growth Rate Market Profitability Trends

Competitive situation (level of competition in the industry) Level of investment risk in the industry

Market entry barriers Opportunities for differentiating products and services Demand volatility Segmentation Distribution structure Technology development

Asset and Competency Advantage Relative Brand Advantage Market Share Market Share Growth Rate Customer Loyalty Relative Cost State (Cost Structure Compared to Competitors)

Relative profit (compared to competitors)

Distribution and production capacity advantage Technological or other innovation indicator Quality

Access to financial and other investment resources

Company management advantage

Model GE/McKinsey is a matrix consisting of nine cells, and is used to form and further comparative analysis strategic positions of directions economic activity audited company. The main feature of this model was that for the first time in it, for the evaluation of strategic business units, not only physical factors (such as sales volume, profit, return on investment, etc.) began to be used, but also subjective characteristics of the business, such as the variability of the share market, technology, staffing status, etc.

Parameters that evaluate the position of the business along the axis y, companies are not controlled. Their values can only be fixed, but it is almost impossible to influence the improvement of these indicators. The positioning of the organization's business along the x-axis is under the control of the audited company itself and can be changed if desired.

Strategic business units are also depicted in the matrix G.E. in the form of circles, where:

the size of the circle indicates the size of the market;
the size of the share of the circle represents the market share of the strategic business unit;
arrows reflect the direction and movement of strategic business units in the future.

Three areas of strategic positions are distinguished in the matrix: 1) the area of winners; 2) area of losers; 3) the average area, which includes positions where profits are consistently generated from the business, average business positions and questionable types of business (Fig. 5.4).

Rice. 5.4. Matrix quadrant structure G.E.

Consider the features and possible strategies of the audited company when its strategic business unit falls into each of the quadrants of the matrix.

Types of business that, when positioned, fall into the “winners” area have better or average values of market attractiveness factors and organizational advantages in the market compared to the rest. In relation to these types of businesses, most likely, a positive decision can be made regarding additional investments, since they are usually focused on further development.

The position, which is conditionally named "Winner (1)", is characterized by the highest degree of market attractiveness and relatively strong advantages of the organization in it. The audited company, represented in this cell of the matrix, is likely to be the undisputed leader or one of the leaders in its market. It can only be threatened by the possible strengthening of the positions of individual competitors. Therefore, the strategy of an organization in such a position should be aimed at protecting its position primarily through additional investment.

The position with the title "Winner (2)" is characterized by the highest degree of market attractiveness and the average level of relative advantages of the organization. A company in this quadrant is not a leader in its industry, but at the same time it is not too far behind. The strategic recommendations of auditors after identifying strengths and weaknesses may in this case be to inject the necessary investments into business units in order to extract the maximum benefit from their strengths and from improving weaknesses.

The position "Winner (3)" can be occupied by an organization with such types of business, in which the market attractiveness is at an average level, but at the same time, the advantages of the organization in the market are obvious and strong. Such an audited company must first of all: identify the most attractive market segments and invest in them; develop their ability to withstand the influence of competitors; increase production volumes and, as a result, achieve an increase in the profitability of the company.

Types of business that fall into the three boxes in the lower right corner of the matrix are called losers. These are types of businesses that have at least one of the lower and none of the higher parameters plotted on the x and y. Additional investments of the organization in them, as a rule, should be limited or absent altogether, since there is no connection between these investments and the mass of the organization's profit.

The “Loser (1)” position is characterized by an average attractiveness of the market and a low level of relative advantages in the market (the middle cell in the right row). For a business unit in this position, the auditors may make the following recommendations:

seeking improvement in low-risk areas;
development of those areas in which this business has a clearly low level of risk;
the concentration of the audited company on increasing the profits of certain strong business areas, and if it is impossible to obtain an increase in profits, leaving this business area.

The “Loser (2)” position is characterized by low market attractiveness and an average level of relative advantages in the market (middle cell in the bottom row). A business unit in this quadrant does not have any particular strengths or capabilities. The business sector is rather unattractive. The audited company represented in this quadrant is not a leader in this type of business, although it can be considered as a serious competitor for the rest. In this position, it is advisable for the organization to focus on reducing risk, protecting its business in the most profitable areas of the market, and if competitors seek to buy out this business and offer good price it's better to accept their offer.

The “Loser (3)” position is characterized by low market attractiveness and a low level of relative advantages of the organization in this type of business. In this position, one can only strive to receive possible profits, refrain from any investment, or exit this type of business altogether.

Types of business that fall into three cells located along the diagonal going from the lower left to the upper right edge of the matrix are called border. These are types of businesses that can both grow under certain conditions, and, conversely, decline.

If a business belongs to dubious types of business (upper right corner), which can be associated, as a rule, with its relatively insignificant competitive advantages for an organization involved in a very attractive and promising business in terms of the state of the market, then the following strategic decisions are possible based on the results audit:

the concentration of the organization on strengthening those of its advantages that can turn into strengths;
the company occupying a separate niche in the market and investing in its development;
in case of impossibility to implement the previous recommendations - leaving this type of business.

A business belonging to the middle positions is characterized by the absence of any special qualities, has an average level of market attractiveness, an average level of relative advantages of the organization in this type of business. The placement of business units in these quadrants determines the company's cautious strategic behavior in the market: to invest selectively and only in very profitable and least risky projects.

The lines of business of an organization, determined by a low level of market attractiveness and a high level of relative advantages of the organization itself in this industry, are called profit producers. In such cases, investments should be directed in order to obtain an effect in the short term, because the collapse of the industry can occur at any time. At the same time, investments should be concentrated around the most attractive market segments.

To implement the method GE/McKinsey the following audit steps should be carried out:

highlight the driving factors of each parameter, i.e. those that are important to overall strategy audited company;
calculate the specific weight of the importance of each factor;
define indicators for strategic business units for each factor;
multiply the weights by the indicators for each strategic business unit;
analyze the resulting diagram and interpret

Perform a sensitivity analysis.

A significant drawback of the above matrices is the lack of analysis of interactions between strategic business units.

21.02.11

In the early 1970s, an analytical model appeared, proposed by the consulting company McKinsey & Co for the General Electric Corporation. and dubbed the GE/McKinsey model. Like many others strategic matrices— the GE/McKinsey matrix is a modified BCG matrix (BCG). Matrix is one of the most popular modern instruments portfolio analysis.

The matrix was originally developed to address the problem of benchmarking the expected future profitability of the 43 strategic business units of the General Electric Corporation. It provided a partial solution to the problem of establishing a common comparative basis for analyzing the strategic positions of businesses that were very different in nature. The focus of the GE/McKinsey model is future profit or the future return on investment that organizations may receive. In other words, the focus is on analyzing what impact additional investment in a particular type of business can have on earnings in the short term. Unlike the BCG matrix, in the GE/McKinsey model each axis of coordinates is treated as an axis of a multifactorial, multidimensional dimension. And it does this model richer in analytical terms compared to the BCG matrix and, at the same time, more realistic in terms of positioning business types.

GE/McKinsey Matrix Structure

The model is based on the assumption that the long-term profitability of a strategic business unit depends on the unit's competitive strength, as well as the ability and motivation to strengthen its market position, which are determined by the attractiveness of the industry. An attractive market implies large current or potential cash flows. Likewise, high competitive strength also means the ability to receive large cash flows.

Vertical Y-Axis— Strength of business (Business Sternth)

Horizontal X-axis– Industry Attractiveness
The size of the circle representing the strategic business unit corresponds to the size of its market, and the sector allocated on it is equal to the share of this strategic business unit in its market.

Criteria used in the GE/McKinsey matrix

(list is not exhaustive)

Business strength
Industry attractiveness
Relative size
Growth
Market share
Position
Comparative profitability
net income
Technological state
Image, image of the enterprise
Management and people
Absolute size
Market Growth
Market breadth
Pricing
Structure of competition
Industry rate of return
social role
Environmental impact
Legal restrictions

The GE/McKinsey matrix is based on a combination of both objectively measurable parameters (market size, profitability, market share, etc.) and subjectively assessed ones.

Immeasurable criteria should be assessed by experts - the most qualified employees of the company (including managers of all levels: top and functional) and third-party experts. In this case, either a normalized scale (from zero to one) or a scale from 1 to 5 (1 and 2 - "low", 3 - "medium", 4 and 5 - "high"). The higher the weight of a factor, the greater the numerical value assigned to it. Summing up the final assessment of all the selected factors for a strategic business unit, we obtain its position on each axis.

GE/McKinsey Matrix Quadrant Values

Three quadrants at the top left of the matrix are the most promising in terms of future investment returns. It is necessary to work in these markets and invest in the growth of these business units. They are usually marked in green.

1. Preservation and strengthening of the market position (Grow/Penetrate):

These business units should be the main focus of investment, they are strong and operate in attractive markets - so they must necessarily generate a high return on investment. Recommendations:

maintaining leadership in this market;
investing to ensure growth at the highest possible rate.

2. Invest for Growth:

These business units operate in very attractive markets, but the strength of these businesses is currently low. They should be the object of investment to strengthen their position in the market. Recommendations:

concentration of efforts to maintain and enhance strengths and competitive advantage;
identification and elimination of weaknesses.

3. Selective Harvest or Investment:

These business units have good strength, but the market is already losing its appeal. Recommendations:

search for growing segments;
investing in growth in these segments to grow faster than the market;
strengthen its market leadership.

Three diagonal quadrants(left-to-right and bottom-to-top) are of medium attractiveness. Investing in these businesses should be, but it should be careful and selective. Main strategy for these types of businesses - to extract the maximum income now. These quadrants are usually marked in yellow.

4. Selective investment or exit from the market (Selective Investment / Divestment):

These businesses operate in very attractive markets, but their market power is low. Investments should be aimed at strengthening their competitive advantages. If these business units can improve their market position, then they should be invested in. Otherwise, it is necessary to prepare for leaving this market. Recommendations:

niche search;
narrow specialization;
consider offers to sell this business.

5. Segmentation & Selective Investment Strategy:

These business units are average in the middle markets. They can only improve their performance through a smart differentiation strategy (see below). competitive strategies according to M. Porter) - creating and developing profitable segments, as well as creating barriers for competitors to enter these segments. Recommendations:

search for growing segments;
specialization and differentiation;
selective investment.

6. Harvest for Cash Generation Strategy:

Strong business in a dying market. The focus needs to be on maximizing the current profitability of this business because there are no more growth opportunities for this business. Limited investment in keeping the business competitive in the short term is possible, but long-term investment is not desirable. It is necessary to carefully watch competitors trying to revive this market. Recommendations:

maintain a leading position;
maximize current income;
invest only in maintaining competitiveness.

Three quadrants bottom right the least attractive, these businesses need to squeeze the most revenue now and refrain from investing. Even the sale or liquidation of these business units is possible. They are usually highlighted in red.

7. Controlled Exit or Disinvestment:

Weak businesses in the middle markets. Trying to increase their competitiveness and market share may be too costly to pay off in such a market. Investing in this business should be extremely careful. Recommendations:

specialization;
search for narrow niches;

8. Harvest under constant control (Controlled Harvest):

In this position, it makes sense for an organization to focus on reducing risk and protecting its business in the most profitable segments. Recommendations:

protection of positions in the most profitable segments;
minimization of investments;
planned withdrawal from this market.

9. Quick exit from the market or attack of competitors (Rapid Exit or Attack).

These business units are prime candidates for closure. The only, and much more difficult, alternative to winding down these businesses is to use them to attack the cash cows of competitors in order to reduce their profitability.

sell goods on time at a bargain price;
look for an opportunity to attack competitors;
minimize fixed costs avoiding investment.

Introduction

In the early 1970s, an analytical model appeared, proposed by the consulting company McKinsey & Co for the General Electric Corporation. and dubbed the "GE/McKinsey model". Like many other strategic matrices, the GE/McKinsey matrix is a modified BCG matrix (BCG). The matrix is one of the most popular modern portfolio analysis tools.

Matrix General Electric & McKinsey (GE/MCKINSEY): industry attractiveness - business sustainability. This matrix was developed by the Mc Kinsey consulting group in conjunction with the General Electric Corporation and was called the "business screen". The matrix was originally developed to address the problem of benchmarking the expected future profitability of the 43 strategic business units of the General Electric Corporation. It provided a partial solution to the problem of establishing a common comparative basis for analyzing the strategic positions of businesses that were very different in nature. The focus of the GE/McKinsey model is on the future earnings or future return on investment that can be earned by organizations. In other words, the focus is on analyzing what impact additional investment in a particular type of business can have on earnings in the short term. Unlike the BCG matrix, in the GE/McKinsey model each axis of coordinates is treated as an axis of a multifactorial, multidimensional dimension. And this makes this model richer in analytical terms compared to the BCG matrix and, at the same time, more realistic in terms of positioning business types.

GE/McKinsey Matrix Structure

The matrix is a square formed along two axes: Business Strength and Industry Attractiveness. Each axis is conditionally divided into three parts: low, medium and high. Accordingly, the matrix consists of 9 quadrants (3x3): vertical axis Y - Business Strength (Business Sternth), horizontal axis X - Industry Attractiveness

The model is based on the assumption that the long-term profitability of a strategic business unit depends on the unit's competitive strength, as well as the ability and motivation to strengthen its market position, which are determined by the attractiveness of the industry. An attractive market implies large actual or potential cash flows. Likewise, high competitive strength also means the ability to generate large cash flows.

The size of the circle representing the strategic business unit corresponds to the size of its market, and the sector allocated on it is equal to the share of this strategic business unit in its market.

Criteria used in the GE/McKinsey matrix

Business strength:

Relative size

Market share

Comparative profitability

net income

Technological state

Image, image of the enterprise

Management and people

Industry attractiveness

Absolute size

Market Growth

Market breadth

Pricing

Structure of competition

Industry rate of return

social role

Environmental impact

Legal restrictions

The GE/McKinsey matrix is based on a combination of both objectively measurable parameters (market size, profitability, market share, etc.) and subjectively assessed ones.

Immeasurable criteria should be assessed by experts - the most qualified employees of the company (including managers at all levels: top and functional) and third-party experts. In this case, either a normalized scale is used (from zero to one), or a scale from 1 to 5 (1 and 2 - "low", 3 - "medium", 4 and 5 - "high"). The higher the weight of the factor, the greater the numerical value assigned to it.” Summing up the final score of all the selected factors for the strategic business unit, we obtain its position on each axis.

GE/McKinsey Matrix Quadrant Values

The position strength index is determined taking into account the indicator of the relative market share, the dynamics of its change, the amount of profit, image, degree of competition, price, product quality, sales efficiency, geographical advantages of the market, and employee performance. It is possible to weigh the indicators used. Three levels of gradation of this index are accepted: strong, medium, weak. The Industry Attractiveness Index is determined by taking into account the size and diversity of markets, the rate of market growth, the number of competitors, industry average earnings, demand cycles, industry cost structure, pricing policy, legislation, labor resources. Three levels of gradation of this index are used: high, medium and low. The intersections of the lines characterizing the different levels of values of these two levels form a grid, which is divided into three zones: the zone in which the organization must invest; the zone in which the organization must maintain investments at the same level; and a zone in which it is necessary to get the maximum possible profit, after which it should be left.

1. Preservation and strengthening of the market position (Grow/Penetrate):

These business units should be the main focus of investment, they are strong and operate in attractive markets - so they must necessarily generate a high return on investment. Recommendations:

maintaining leadership in this market;

investing to ensure growth at the highest possible rate.

2. Invest for Growth:

concentration of efforts to maintain and enhance strengths and competitive advantages;

identification and elimination of weaknesses.

3. Selective Harvest or Investment:

These business units have good strength, but the market is already losing its appeal. Recommendations:

search for growing segments;

investing in growth in these segments to grow faster than the market;

strengthen its market leadership.

Three diagonal quadrants (left to right and bottom to top) are of medium attractiveness. Investing in these businesses should be, but it should be careful and selective. The main strategy for these types of businesses is to extract the maximum income now. These quadrants are usually marked in yellow.

4. Selective investment or exit from the market (Selective Investment / Divestment):

niche search;

narrow specialization;

consider offers to sell this business.

5. Segmentation & Selective Investment Strategy:

These business units are average in the middle markets. They can improve their results only through a competent differentiation strategy (competitive strategies according to M. Porter) - creating and developing profitable segments, as well as creating barriers for competitors to enter these segments. Recommendations:

search for growing segments;

specialization and differentiation;

selective investment.

6. Strategy "gathering harvest "(Harvest for Cash Generation):

maintain a leading position;

maximize current income;

invest only in maintaining competitiveness.

7. Controlled Exit or Disinvestment:

specialization;

search for narrow niches;

8. Harvest under constant control (Controlled Harvest):

In this position, it makes sense for an organization to focus on reducing risk and protecting its business in the most profitable segments. Recommendations:

protection of positions in the most profitable segments;

minimization of investments;

planned withdrawal from this market.

9. Quick exit from the market or attack of competitors (Rapid Exit or Attack).

These business units are prime candidates for closure. The only, and far more difficult, alternative to winding down these businesses is to use them to attack the cash cows of competitors in order to reduce their profitability.

GE matrix, or McKinsey matrix used in assessing the attractiveness of individual strategic economic units based on two coordinates: the X axis characterizes the strength of the position of a strategic economic unit in the industry, the Y axis - the attractiveness of the industry. Each of these coordinates is determined taking into account several parameters.

McKinsey matrix (McKinsey) was developed for General Electric. The X-axis is the competitive position (relative advantage) of the strategic business unit, the Y-axis is the attractiveness of the industry in which the strategic business unit operates. Each axis is divided into three parts. The matrix has a dimension of 3 * 3. Unlike BCG, in this matrix, each coordinate axis is considered as an axis of a multivariate measurement. The McKinsey matrix is more realistic. Indicators along the Y axis - are practically beyond the control of the company, along the X axis - on the contrary, they can be changed (Table 6.1).

Table 6.1 X-Axis and Y-Axis Scores for the McKinsey Matrix

For X axis- competitive advantages of the business area.

1. Define the key success factors for each business area.

2. Specific gravity(relative importance) of each factor.

3. We put a rating for each factor. 5 - if the product has a very strong competitive position in a similar industry, 1 - if a very weak competitive position.

For Y axis- the attractiveness of the business area as an industry.

The algorithm is similar.

We will choose the parameters by which the attractiveness of the industry will be assessed.

As a result of the analysis using the McKinsey matrix, good analysis product portfolio.

The analyzed business units are reflected in the form of circles with centers at the intersection of their respective values. Each circle corresponds to the total sales in some market (Fig. 6.2).

There are three areas:

§ winners;

§ losers;

§ middle area (diagonally).

Rice. 6.2. McKinsey matrix

The basic principle of the method- increase investments in business areas in attractive industries if the company has competitive advantages in them, and, conversely, reduce investments if the position of the product market itself or the company on it turns out to be weak. You can evaluate the contribution of the product to the profitability of the company.

For winners- additional investment, get profit, protection of benefits. For the losers - to limit investment until the stop, additional investment will not bring profit. For border areas- either grow or shrink until liquidation.

Position strength index is based on the indicator of the relative market share, the dynamics of its change, the amount of profit received, the image, the degree of price competitiveness, product quality, sales efficiency, geographical advantages of the market, and the efficiency of employees. It is possible to weigh the indicators used. Three levels of gradation of this index are accepted: strong, medium, weak. The Industry Attractiveness Index is determined by taking into account the size and diversity of markets, market growth rate, number of competitors, industry average earnings, demand cycles, industry cost structure, pricing policy, legislation, and labor resources. Three levels of gradation of this index are used: high, medium and low. The intersection of the lines characterizing the different levels of values of these two levels forms a grid, which is divided into three zones: the zone in which the organization must invest; the zone in which the organization must maintain investment at the same level, and the zone in which it is necessary to obtain the maximum possible profit, after which it should be left.

Advantages of matrices as a marketing tool strategic analysis are as follows:

First, the matrices allow you to summarize the results of strategic analysis and present them in a user-friendly form. This is very important because strategic analysis is associated with a large amount of data, therefore it is very difficult to structure and generalize which;

secondly, matrices allow us to track the relationship of two factors that form the basis of the matrix, and their mutually consistent influence on strategic activities enterprises;

thirdly, matrix analysis provides an opportunity to establish the strategic priorities of the enterprise, as well as priorities in the distribution of its resources;

fourthly, matrices make it possible to optimally distribute the activities of the enterprise according to the selected features. If these are matrices with the help of which portfolio analysis is carried out, then the activities of the enterprise are distributed behind its strategic business subdivisions. If this is a “price-quality” matrix, then it optimizes the allocation of resources in terms of price and quality indicators, etc.;

fifthly, the matrices offer certain patterns of strategic analysis and generalized varieties (samples) of strategies in a certain strategic situation, which greatly facilitates the practical activities of the strategist.

The disadvantages of matrices as a tool for marketing strategic analysis are manifested in the following:

firstly, some matrices (mainly multi-criteria ones) are associated with the determination of coefficients and ranks of indicators, which mean a significant influence of the subjective factor that reduces the objectivity of the matrix analysis;

secondly, most matrices (especially portfolio analysis matrices) are static in nature, that is, they recreate the current state of enterprise development, which does not allow assessing the dynamics of strategic processes;

thirdly, the recommendations of the matrices regarding the formulation of enterprise strategies are very general and therefore require clarification. By proposing possible “standard” strategies, matrix analysis does not determine the direction of their implementation;

fourthly, most matrices offer alternative strategies. For example, the BCG matrix - regarding strategic business zones - “question marks”, the General Electric matrix - regarding the selective development zone, etc. This greatly complicates the process of formulating strategies for these quadrants of the matrix, since it is assumed that the choice of strategy is multivariate (ambiguous);

fifthly, the matrix analysis takes into account only two indicators/factors on the basis of which the matrix is built, therefore, when formulating the final version of the strategy, it is necessary to use other methods of strategic analysis, except for the matrix, that take into account the influence of those factors and indicators that were ignored by the matrices ;

sixth, the construction of some matrices (especially multicriteria ones) requires a lot of effort.

Questions for the theoretical part of the exam

1. Strategic management as a concept and aspect of management.

The concept of strategy (5 "P" G. Mintzberg)
Basic provisions of strategic management
Levels of strategy: approaches to isolation.
general characteristics functional strategy. Its relationship with the BE strategy.
General characteristics of the business unit (BU) strategy. The concept of "strategic business unit".
Key hypotheses of strategic management
Characteristics of the generalized model of strategic management.
The essence of the mission and its significance for strategic management.
The system of strategic goals.
Necessity and types of analysis of strategic factors.
System of strategic factors.
The essence of SWOT analysis.
The essence of PEST analysis.
Analysis of the competitive environment: essence and system of factors.
Approach to strategy definition based on market and product novelty analysis (Ansoff).
Approach to strategy definition based on the analysis of market dynamics and competitive position (Thompson and Strickland)
An Approach to Determining Strategy Based on Analysis of Competitive Advantage and Market Size (Porter)
Characterization of Leadership Strategies (Porter)
Characterization of Focusing Strategies (Porter)
General characteristics of strategies concentrated growth
General Description of Integrated Growth Strategies
General characteristics of diversified growth strategies
General characteristics of reduction strategies.
The essence of portfolio analysis and planning
The main stages of portfolio analysis and planning
Portfolio based analysis BCG matrices.
Limitations of the BCG matrix.
Portfolio analysis based on the McKinsey matrix.
Advantages and disadvantages of matrix-based portfolio analysis.

Main literature

1. Ansoff I. New corporate strategy: Per. from English. St. Petersburg: Peter, 1998.

2. Vikhansky O.S. Strategic management. M.: Gardariki, 2001.

3. Zaitsev L.G., Sokolova M.I. Strategic management. M.: Jurist, 2002.

4. Zub A.T. Strategic Management: Theory and Practice: Tutorial for universities. - M.: Aspect Press, 2002. - 415 p.

5. Thompson A.A., Strickland A.J. Strategic management: Textbook / Per. from English. under teach, ed. L.G. Zaitseva, M.I. Sokolova. M.: UNITI, 1998.

additional literature

6. Bowman K. Fundamentals of strategic management / Per. from English, under scientific ed. L.G. Zaitseva, M.I. Sokolova. M.: UNITI, 1997.

7. Wissema Hans. Strategic management / Per. from English, edited by Yu. Dzharova, P.M. Nureyev. M.: Finpress, 2000.

8. Gerchikova I.N. Management. M.: UNITI, 1997.

9. Dihtp E., Hörschgen X. Practical marketing: TRANS. with him. M.: graduate School, 1995.

10. Daniels John D., Raber Lee X. International business / Per. from English, under scientific ed. L.I. Evenenko. M.: Delo LTD, 1994.

11. Efremov B.C. Business strategy. Concepts and methods of planning. Moscow: Finpress, 1998.

12. Karlof B. Business strategy: TRANS. from English. M.: Economics, 1991.

13. Knorring V.I. Theory, practice and art of management: Textbook for universities. M.: Norma-Infra-M, 1999.

14. Kotler F. Marketing management: Per. from English. St. Petersburg: Peter, 1998.

15. Kruglov M. I. Strategic management of the company. - M .: Russian business literature, 1998.

16. Krugman P.R., Obstfeld M. International economics/ Per. from English, under scientific ed. V.P. Kolesova, M.V. Kulakov. M.: UNITI, 1997.

17. Krylova G.D., Sokolova M.I. Marketing. Theory and 86 situations. M.: UNITI, 1998.

18. Meskon M., Albert M., Hedouri F. Fundamentals of management / Per. from English, under scientific ed. L.I. Evenenko. M.: Delo, 1992.

19. Mintzberg G., Alstrad Bruce, Lampel Joseph. Schools of strategies: Per. from eng. St. Petersburg: Peter, 2000.

20. Mintzberg G., Quinn J. B., Ghoshal S. Strategic Process. - St. Petersburg: PETER, 2001.

21. Nozdreva R.B., Krylova G.D., Sokolova M.I., Grenkov V.Yu. Marketing: Textbook. M.: Jurist, 2000.

22. Popov S. A. Strategic management: 17-module program for managers "Management of the development of the organization". Module 4. - M .: INFRA-M, 2000.

23. Porter M. International competition / Per. from English, under scientific ed. V.D. Shchetinin. M.: International relationships, 1993.

24. Thompson A. A., Jr., Strickland III A. J. Strategic management: concepts and situations: Textbook for universities. – M.: INFRA-M, 2000.

25. Management of the organization: Textbook / Ed. A.G. Porshneva, Z.P. Rumyantseva, N.A. Salomatina. M.: Infra-M, 1999.

26. Management of the organization: Encyclopedic Dictionary./ Ed. A. G. Porshneva, A. Ya. Kibanova, V. N. Gunina. - M .: INFRA-M, 2001.

27. Fatkhutdinov R. A. Strategic management. - M .: CJSC "Business School" Intel-Sintez ", 1997.

28. Francis J. Guillard, James N. Kelly. Organization transformation. M.: Delo, 2000.

29. Economic strategy of the company / Ed. A.P. Gradov. St. Petersburg: Special Literature, 1995.

Periodicals

Newspapers: "Kommersant", "Economics and Life", "Vedomosti".

Magazines: "Money", "Expert", "The Secret of the Firm", "Company".

Internet resources

1. http://www.aup.ru Administrative and Management Portal - Publications on economics, finance, management and marketing.

2. http://www.cfin.ru Corporate management. Materials and publications on all

3. branches of management.

4. http://www.consulting.ru Consulting site.

5. http://www.devbusiness.ru Business development. Organizational design.

6. http://www.econline.h1.ru - online economics. Collection of resources on economics,

7. management, etc.

8. http://www.emd.ru Website of the Euromanagement company.

9. http://www.hrm.ru Personnel management, personnel management.

10. http://www.marketing.spb.ru I. Marketing - Marketing Library.

11. http://mc-ma.narod.ru/portal.htm Russian Management Portal.

12. http://www.profy.ru Publications, articles and methodical materials on management.

13. http://www.ptpu.ru/default.asp Site of the journal "Problems of theory and practice of management".

14. http://superidea.ru/index.htm Ideas in various business areas).

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