When the competitive position of business changes or when the industry move towards next stage, it becomes crucial for business owners to reconfigure their business strategy. You should be able to think about the state of your industry and determine how your organization fits into the current industry. There are a number of tools that help you to do this. ADL Matrix is one such tool using which you can think about your business strategy by considering the industry maturity and competitive position of your business.
About the Model
ADL matrix model, developed by Arthur D. Little is a portfolio management matrix which shows how a business owner should plan its strategy keeping in mind its position and industryâ€™s lifecycle stage. The matrix is plotted with competitive positions on one axis and industry stage on other, where the line of business is not defined by the organizational unit or a product. The strategies must identify the businesses by finding similarities among the products and business line using the guidelines as mentioned below.
- Common competitors
The assessment of life cycle stages is made on the basis of investment, business market share and cash flow.