McKinsey's Growth Pyramid Model and Matrix Template

Description
The "McKinsey Growth Pyramid" Framework stems from a McKinsey & Company publication of suprisingly quite an unprecise origin (the original authors are not clearly identified), but which is extremely used by decision makers in the business world.

The gist of the framework is in presenting visually via a 7 storey pyramid and a 6 story stack, respectively the "Achieving Growth Strategies" (7) and the "Go-to-market strategies" (6), potential growth routes for a company, business unit(s), or brand(s).

Given the pertinence of the framework for CEOs, Business Leaders and consultants, I decided to create for Eloquens :

A/1 universal "classic" template to analyse one individual Company, Business Unit or Brand 
B/+ 1 new spinoff matrix concept combining both dimensions into a 6 x 7 grid (42 possibilities), with the possibility to position business units, determine the frequency of the combinations + visualise the exiting revenue growth trends.

B/ has therefore two axis :
- Achieving Growth Strategy (7 steps) - Y-Axis
- Go-to-market strategy (6 steps) - X-Axis 

✅ Achieving Growth Strategy Pyramid - by growth potential (Y-Axis) :

1. Existing products to existing customers: Expanding sales of current offerings to current clientele.

2. Existing products to new customers: Targeting new market segments or demographics to increase the customer base for existing products.

3. New products and strategies: Innovating by developing and launching new products or services, or implementing new business strategies to meet evolving market demands.

4. New delivery approaches: Introducing innovative distribution methods or channels to reach customers more efficiently or to penetrate previously inaccessible markets.

5. New geographies: Expanding operations into new geographical regions or countries to tap into new markets and diversify revenue streams.

6. New industry structures: Adapting to changes in industry dynamics, such as emerging technologies or regulatory shifts, to capitalize on new opportunities or mitigate risks.

7. New competitive arenas: Diversifying into new industries or market segments to mitigate competitive pressures or to capitalize on synergies between different business units or markets.

✅ Go-to-market strategy Stack - by increased level of risk (X-Axis):

- Organic Investments: Investing in internal resources, capabilities, and processes to organically grow the business, such as expanding production capacity or enhancing marketing efforts.

- Marketing Partnerships: Collaborating with other companies or organizations to leverage their marketing channels, expertise, or customer base to promote products or services.

- Strategic Alliances: Forming partnerships with other firms to combine resources, technologies, or market access to pursue shared objectives or to enter new markets more effectively.

- Minority Stakes: Acquiring minority ownership positions in other companies to gain strategic insights, access to new markets, or to foster collaborative relationships without full acquisition.

- Joint Ventures: Establishing joint ventures with other companies to undertake specific projects, enter new markets, or share risks and rewards of a business endeavor.

- Acquisitions: Purchasing other companies outright to gain access to their products, technologies, customer base, or market presence, often to accelerate growth or to diversify business operations.

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The combination of both dimensions gives a total of 42 possibilites, categorised in 5 different usually observed "frequencies" :

1. 🎻 Classic (19) - e.g.: New competitive arenas x Acquisitions
2. 🌟 Classic / Occasional (5) - e.g.: New geographies x Acquisitions
3. 🚀 Occasional (10) - e.g.: Existing products to new customers x Joint Ventures 
4. 💎 Occasional / Rare (3) - e.g.: New geographies x Organic Investments
5. 🦄 Rare (5) - e.g.: New competitive arenas x Organic Investments

👉 Here are some real-life examples, from the business history books : 


1. 🎻 Classic:
Example: New competitive arenas x Acquisitions

Facebook's Acquisition of Instagram: In 2012, Facebook acquired Instagram, a photo-sharing app, for $1 billion. With this acquisition, Facebook entered the rapidly growing mobile photo-sharing market, expanding its reach beyond its core social networking platform.


2. 🌟 Classic / Occasional:
Example: New geographies x Acquisitions

Walmart's Acquisition of Flipkart: In 2018, Walmart acquired a 77% stake in Flipkart, an Indian e-commerce company, for $16 billion. This acquisition allowed Walmart to enter the Indian retail market, which is one of the fastest-growing e-commerce markets globally.


3. 🚀 Occasional:
Example: Existing products to new customers x Joint Ventures

Starbucks' Partnership with PepsiCo: In 1994, Starbucks formed a joint venture with PepsiCo to distribute its ready-to-drink bottled beverages. This partnership allowed Starbucks to reach new customers who preferred to purchase their coffee drinks from grocery stores, convenience stores, and vending machines.


4. 💎 Occasional / Rare:
Example: New geographies x Organic Investments

Tesla's Gigafactory Expansion: Tesla's decision to build Gigafactories in new geographical locations, such as Gigafactory Shanghai in China and Gigafactory Berlin in Germany, represents an example of organic investment to expand into new geographies. These investments are aimed at establishing local manufacturing capabilities to cater to regional markets.


5. 🦄 Rare:
Example: New competitive arenas x Organic Investments

Amazon's Development of Kindle and AWS: Amazon's development of the Kindle e-reader and Amazon Web Services (AWS) cloud computing platform are examples of organic investments in new competitive arenas. These ventures allowed Amazon to diversify its business beyond e-commerce and retail into digital content distribution and cloud computing, respectively, creating entirely new markets and revenue streams.

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The package is 2 editable Microsoft PowerPoint Template Slides + 1 Excel Model, with an online or offline 23 step-by-step methodology, with pedagogical illustrations for each step.

Should you have any questions on using these top tier McKinsey Growth Pyramid Model and Matrix frameworks, you're welcome to reach out to me via Private Message.

Good luck!
- Tim

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