The GE/McKinsey Matrix is a strategic tool used for portfolio analysis, helping businesses evaluate their product lines or business units. It categorizes them based on two key dimensions: market attractiveness and competitive strength. Each unit is plotted on a grid, allowing companies to identify which areas to invest in, develop, or divest. The matrix consists of nine cells, divided into three categories: high, medium, and low. This visual representation aids decision-makers in prioritizing resources and strategies, ensuring that investments align with overall business goals. By using the GE/McKinsey Matrix, organizations can make informed choices about their strategic direction.