The ADL Matrix from Arthur D. Little is a portfolio management method.
The ADL portfolio management approach uses an industry assessment and a business strength assessment as its dimensions. The industry measurement is an identification of the life cycle of the industry. The business strength measure is a categorization of the corporation's SBU's into one of five (six) competitive positions: dominant, strong, favorable, tenable, weak (and non-viable). This yields a matrix of 5 competitive positions by 4 life cycle stages. Positioning in the matrix identifies a general strategy.
Defining the line of business in the ADL matrix
In the ADL Matrix approach, the strategist must identify discrete businesses by finding commonalities among products and business lines using the following criteria as guidelines:
Assessing the Industry Life Cycle stage in the ADL Matrix
The assessment of the Industry Life Cycle stage of each company is made on the basis of:
Assessing the competitive position in the ADL Matrix
The competitive position of a firm is based on an assessment of the following criteria:
Some known limitations of the ADL Matrix are:
Compare with the ADL Matrix: BCG Matrix | McKinsey Matrix | STRATPORT | Product Life Cycle | Bass Diffusion Model | Innovation Adoption Curve | Profit Pools | Four Trajectories of Industry Change | Forget Borrow Learn | Product/Market Grid | Three Dimensional Business Definition
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