Strategic Portfolio Design Using McKinsey's Matrix PPT

This PPT slide, part of the 62-slide Corporate Strategy Toolkit PowerPoint presentation, presents McKinsey's market attractiveness/business strength matrix, a strategic tool for portfolio design. It visually categorizes business units based on 2 key dimensions: industry attractiveness and business strength. The matrix is divided into 4 quadrants, each indicating a different strategic approach.

The vertical axis represents industry attractiveness, which includes factors like market growth, market size, competitive structure, and barriers to entry. The horizontal axis indicates business strength, encompassing elements such as market share, financial resources, research and development position, and brand identity.

In the upper right quadrant, labeled "Investment and growth," businesses positioned here are in attractive industries with high strength. This suggests a clear directive for investment to capitalize on growth opportunities. The adjacent quadrant, "Selective growth," also indicates potential for growth, but may require more targeted strategies due to varying levels of strength.

The middle section, marked "Selectivity," suggests a more cautious approach. Businesses here might not be in the strongest position, but still have opportunities worth pursuing selectively. The lower left quadrant, "Harvest/divest," indicates that businesses in this area should consider exiting or minimizing investment, as they operate in less attractive industries with low strength.

This matrix serves as a framework for executives to evaluate their portfolio strategically. It aids in decision-making regarding resource allocation and prioritization of business units, ensuring that efforts align with both market potential and internal capabilities.

This slide is part of the Corporate Strategy Toolkit PowerPoint presentation.

This toolkit is created by trained McKinsey, BCG, and Porsche Consulting consultants and is the same used by MBB, Big 4, and Fortune 100 companies when performing Strategic Management Initiatives.

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