Grand strategy matrix is a last matrix of matching strategy
formulation framework. It same as important
as BCG, IE and other matrices. This chapter enables you to
understand the preparation of GS matrix.
This chapter also enables you to understand the last stage
(decision stage) of strategy formulation frame
work and also explain that how it is prepared
Grand Strategy Matrix
This is also an important matrix of strategy formulation frame
work. Grand strategy matrix it is popular
tool for formulating alternative strategies. In this matrix all
organization divides into four quadrants.
Any organization should be placed in any one of four quadrants.
Appropriate strategies for an
organization to consider are listed in sequential order of
attractiveness in each quadrant of the matrix.
It is based two major dimensions
1. Market growth
2. Competitive position
All quadrant contain all possible strategies
that company’s strong having competitive situation and rapid market growth.
Firms located in Quadrant I of the Grand Strategy Matrix are in
an excellent strategic position. These
firms must focus on current market and appropriate to follow
market penetration, market development
and products development are appropriate strategies.
SLOW MARKET GROWTH
RAPID MARKET GROWTH
that company’s having weak competitive situation and rapid market growth. Firms
positioned in Quadrant II need to evaluate their present
approach to the marketplace seriously.
Although their industry is growing, they are unable to compete
effectively, and they need to determine
why the firm's current approach is ineffectual and how the
company can best change to improve its
competitiveness. Because Quadrant II firms are in a
rapid-market-growth industry, an intensive strategy
(as opposed to integrative or diversification) is usually the
first option that should be considered.
that company’s weak competitive situation and slow market growth. The firms fall
in this quadrant compete in slow-growth industries and have weak
competitive positions. These firms
must make some drastic changes quickly to avoid further demise
and possible liquidation. Extensive
cost and asset reduction (retrenchment) should be pursued first.
An alternative strategy is to shift
resources away from the current business into different areas.
If all else fails, the final options for
Quadrant III businesses are divestiture or liquidation.
that company’s strong competitive situation and slow market growth. Finally,
Quadrant IV businesses have a strong competitive position but
are in a slow-growth industry. These
firms have the strength to launch diversified programs into more
promising growth areas. Quadrant IV
firms have characteristically high cash flow levels and limited
internal growth needs and often can
pursue concentric, horizontal, or conglomerate diversification
successfully. Quadrant IV firms also may
pursue joint ventures
As above figure there are four quadrants in grand matrix that
further contain various set strategies.
Every firm fall any one four quadrants and if the firm fall in
quadrant-1 it must follow the list of
strategies given in it. As further if the firm falls in
quarrant-2 must adopt the strategies given in
quadrant-2 and so on