Exercise – GE Business Screen

• Lesson
• Exercise
• Answer

This exercise asks you to apply the GE Business Screen to Northwind Industries.

The Scenario: Northwind Industries

Northwind Industries is a diversified manufacturer reviewing two of its business units. The board has agreed the weightings but not yet the conclusions.

Unit A, commercial heat pumps. Industry attractiveness: market growth scores 5 out of 5 at a weight of 0.3; margins score 3 at 0.3; competitive intensity scores 2 at 0.2 because several well-funded entrants have arrived; regulatory support scores 5 at 0.2. Business unit strength: market share scores 2 at 0.4; brand recognition scores 2 at 0.3; cost position scores 4 at 0.3.

Unit B, industrial fasteners. Industry attractiveness: growth scores 1 at 0.3; margins score 4 at 0.3; competitive intensity scores 4 at 0.2; regulatory support scores 2 at 0.2. Business unit strength: market share scores 5 at 0.4; brand scores 4 at 0.3; cost position scores 4 at 0.3.

Once you have drafted your own answer, compare it with Marketing Teacher’s suggested answer.