The Shell DPM was a technique originated for systematically analysing the qualitative factors present in the organisation, which had an impact on corporate planning.
It was developed at around about the same time as the GE McKinsey matrix and was developed specifically for the petroleum industry.
The main criteria by which prospects for a business may be judged to be favourable or unfavourable (favourable meaning a high profit and growth potential) – business sector prospects: x-axis
The main criteria by which a company’s position in a sector may be judged to be strong or weak – competitive position: y-axis
The Shell DPM is made up of nine quadrants and has found the three columns and three rows to be convenient for them
Factors are given the same weighting and are then scored on a star system.
Positioning occurs on any of nine boxes, which are usually assessed according to the prospects of the sector
Right hand column –
Leader
Try harder
Double or quit
Middle column – growth in this area has fallen to the average for the industry (average sectors)
Leader/Growth
Growth/Custodial
Phased withdrawal
Left hand column – this relates to businesses with low growth rate and market quality, poor feedstock position ands outlook
Cash generation
Phased withdrawal
Divest