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Boston Consulting Group: Portfolio Analysis Matrix

The document presents an analysis of five strategic business units (SBUs) using the Boston Consulting Group (BCG) portfolio matrix. It provides data on the sales, number of competitors, market share, and growth rates for each SBU. Based on the analysis, SBU E is recommended for divestment, SBU D for harvesting, and SBUs B and A for investment. The limitations of the BCG matrix are discussed, and additional contextual data is suggested for a more robust analysis, including technological, political/legal, economic, and socio-cultural factors.

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Nimish Sharma
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223 views16 pages

Boston Consulting Group: Portfolio Analysis Matrix

The document presents an analysis of five strategic business units (SBUs) using the Boston Consulting Group (BCG) portfolio matrix. It provides data on the sales, number of competitors, market share, and growth rates for each SBU. Based on the analysis, SBU E is recommended for divestment, SBU D for harvesting, and SBUs B and A for investment. The limitations of the BCG matrix are discussed, and additional contextual data is suggested for a more robust analysis, including technological, political/legal, economic, and socio-cultural factors.

Uploaded by

Nimish Sharma
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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BOSTON CONSULTING

GROUP

PORTFOLIO ANALYSIS MATRIX

By
Prerna Singh (22)
Karan Gujral (27)
Kartikeya Raina (28)
Nimish Sharma (49)
Nikhil Nuwal (46)
Pankaj Vidhani (52)
Vivek Dabbas (59)
GIVEN DATA

SBU SALES(Rs No. OF SALES OF TOP 3 ANNUAL


Million) COMPETIT PLAYERS(Rs MARKET
ORS Million) GROWTH
RATE

A .5 8 0.7,0.7,0.5 15%
B 1.6 22 1.6,1.6,1 18%
C 1.8 14 1.8,1.2,1 7%
D 3.2 5 3.2,0.8,0.7 4%
E 0.5 10 2.5,1.8,1.7 4%
RELATIVE MARKET DOMINANCE

SBU SALES(Rs RELATIVE ANNUAL


Million) MARKET MARKET
DOMINANC GROWTH
E RATE
A 0.5 0.71 15%
B 1 1 18%
C 1.8 1.5 7%
D 3.2 4 4%
E 0.5 0.2 4%
FUTURE RECOMMENDATION AND
STRATEGIES
 They take extraordinary amount
of management time
 Such companies take a lot of cash
 It is necessary if future market
STARS share is to be realized by further
enhancing market penetration
and by reinvesting in product
development for excellent results
 Market is growing but for some
reasons company’s products are not
assuming a strong position in either
cash flow or market share
PROBLEM  They consume large amount of cash
and management time
CHILD  Sometimes better to divest from such
companies
 On the other hand they may present
opportunities for solving problems
and they could move forward to
become cash cows or stars
NEW STRTAEGY

Divest completely from E


Harvest D
Invest in B and A
Hold C
LIMITATION OF BCG MATRIX
LIMITATIONS

Market is not clearly defined in this model


High market share does not always lead to high
profits. There are high costs also involved with
high market share
At times dog may earn good profit
Additional data required
 New development inside and
TECHNOLOGICAL
outside industry
 New product development
 Industry spending on R&D
 Potential/actual changes in
regulation/legislation
POLITICAL/  Foreign trade regulation
LEGAL  Environmental protection
 Changes in Govt.
 GDP growth
 Finance/market trends
 Inflation
ECONOMIC
 Interest rates
 Energy issues
SOCIO  Population trends
CULTURAL  Age distribution
 Lifestyle
THANK YOU

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