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CS Professional · Strategic Management and Corporate Finance · Strategic Analysis and Planning

The GE (McKinsey) nine-cell matrix differs from the BCG matrix mainly because it:

The GE nine-cell matrix uses multi-factor composite scores for industry attractiveness and business strength, producing a 3x3 grid. The BCG matrix uses only market growth and relative market share in a 2x2 grid, making GE a more comprehensive portfolio tool.

  1. AUses composite measures of industry attractiveness and business strength rather than only market growth and relative shareCorrect
  2. BUses only two variables, market growth and market share, divided into four cells
  3. CClassifies units solely by product life-cycle stage
  4. DMeasures only the financial return on investment of each unit

Explanation

The GE matrix plots industry attractiveness against business unit strength, each built from several weighted factors such as size, margins, technology and brand, giving a 3x3 grid. BCG relies on just two single-factor measures in a 2x2 grid, so the option describing two variables describes BCG, not GE.

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