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| Experience Curve Analysis× | GE-McKinsey Nine-Box Matrix× | |
|---|---|---|
| Field | Strategic Management | Strategic Management |
| Family | Process / pipeline | Process / pipeline |
| Year of origin≠ | 1979 | 1983 |
| Originator≠ | Bruce D. Henderson (Boston Consulting Group); learning-curve tradition (T. P. Wright; Louis Yelle) | General Electric & McKinsey & Company; Arnoldo Hax & Nicolas Majluf |
| Type≠ | Cost-projection pipeline linking cumulative volume to unit cost | Multifactor portfolio-classification pipeline for resource allocation |
| Seminal source≠ | Yelle, L. E. (1979). The Learning Curve: Historical Review and Comprehensive Survey. Decision Sciences, 10(2), 302-328. DOI ↗ | Hax, A. C., & Majluf, N. S. (1983). The Use of the Industry Attractiveness-Business Strength Matrix in Strategic Planning. Interfaces, 13(2), 54-71. DOI ↗ |
| Aliases | Experience Curve, BCG Experience Curve, Learning Curve Analysis, Cumulative Cost Curve Analysis | GE Matrix, Nine-Box Matrix, Industry Attractiveness-Business Strength Matrix, Directional Policy Matrix |
| Related | 4 | 4 |
| Summary≠ | Experience curve analysis describes and projects how the real unit cost of a product falls by a roughly constant percentage every time cumulative production volume doubles, and draws the strategic consequences for cost position and pricing. The Boston Consulting Group, under Bruce Henderson, generalized the older manufacturing learning curve in the late 1960s and 1970s into the broader 'experience curve,' covering not just direct labor but all value-added costs, and made it the analytical backbone of its strategy advice — including the growth-share matrix's premise that the high-relative-share firm enjoys a cost advantage. Louis Yelle's 1979 Decision Sciences survey reviewed the underlying learning-curve literature and its mathematics, while Barry Hedley's 1977 article tied the experience-curve cost logic to portfolio strategy. The method fits a power-law relationship between unit cost and accumulated volume and uses the estimated learning rate to forecast costs and inform competitive strategy. | The GE-McKinsey nine-box matrix is a multifactor portfolio-analysis tool that positions a company's business units in a three-by-three grid defined by two composite dimensions: the attractiveness of the industry the unit competes in, and the unit's competitive strength within it. Developed by General Electric with McKinsey & Company in the early 1970s as a richer alternative to the BCG growth-share matrix, it replaces single proxies (market growth and relative share) with weighted indices built from many underlying factors. Hax and Majluf's 1983 Interfaces article gave the matrix a systematic methodological treatment, and Wind, Mahajan, and Swire's 1983 Journal of Marketing study empirically compared it with other standardized portfolio models, showing how much business positions depend on model choice. The nine cells map onto invest-grow, selectivity, and harvest-divest zones that guide resource allocation. |
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