BCG Matrix

Boston Consulting Group (BCG) Matrix is a four celled matrix (a 2 * 2 matrix) developed by
BCG, USA. It is the most renowned corporate portfolio analysis tool. It provides a graphic
representation for an organization to examine different businesses in its portfolio on the basis of
their related market share and industry growth rates. It is a two-dimensional analysis on
management of SBU’s (Strategic Business Units). In other words, it is a comparative analysis of
business potential and the evaluation of environment.

According to this matrix, business could be classified as high or low according to their industry
growth rate and relative market share.

Relative Market Share = SBU Sales this year leading competitors’ sales this year.

Market Growth Rate = Industry sales this year - Industry Sales last year.

The analysis requires that both measures be calculated for each SBU. The dimension of business
strength, relative market share, will measure comparative advantage indicated by market
dominance. The key theory underlying this is existence of an experience curve and that market
share is achieved due to overall cost leadership.

BCG matrix has four cells, with the horizontal axis representing relative market share and the
vertical axis denoting market growth rate. The mid-point of relative market share is set at 1.0. if
all the SBU’s are in same industry, the average growth rate of the industry is used. While, if all the
SBU’s are located in different industries, then the mid-point is set at the growth rate for the
economy.

Resources are allocated to the business units according to their situation on the grid. The four
cells of this matrix have been called as stars, cash cows, question marks and dogs. Each of these
cells represents a particular type of business.

10 x 1x 0.1
x

Figure: BCG Matrix

 1. Stars- Stars represent business units having large market share in a fast growing
industry. They may generate cash but because of fast growing market, stars require huge
investments to maintain their lead. Net cash flow is usually modest. SBU’s located in this
cell are attractive as they are located in a robust industry and these business units are
highly competitive in the industry. If successful, a star will become a cash cow when the
industry matures.
2. Cash Cows- Cash Cows represents business units having a large market share in a
mature, slow growing industry. Cash cows require little investment and generate cash
that can be utilized for investment in other business units. These SBU’s are the
corporation’s key source of cash, and are specifically the core business. They are the
base of an organization. These businesses usually follow stability strategies. When cash
cows loose their appeal and move towards deterioration, then a retrenchment policy
may be pursued.
3. Question Marks- Question marks represent business units having low relative market
share and located in a high growth industry. They require huge amount of cash to
maintain or gain market share. They require attention to determine if the venture can be
viable. Question marks are generally new goods and services which have a good
commercial prospective. There is no specific strategy which can be adopted. If the firm
thinks it has dominant market share, then it can adopt expansion strategy, else
retrenchment strategy can be adopted. Most businesses start as question marks as the
company tries to enter a high growth market in which there is already a market-share. If
ignored, then question marks may become dogs, while if huge investment is made, then
they have potential of becoming stars.
4. Dogs- Dogs represent businesses having weak market shares in low-growth markets.
They neither generate cash nor require huge amount of cash. Due to low market share,
these business units face cost disadvantages. Generally retrenchment strategies are
adopted because these firms can gain market share only at the expense of
competitor’s/rival firms. These business firms have weak market share because of high
costs, poor quality, ineffective marketing, etc. Unless a dog has some other strategic aim,
it should be liquidated if there is fewer prospects for it to gain market share. Number of
dogs should be avoided and minimized in an organization.

Limitations of BCG Matrix

The BCG Matrix produces a framework for allocating resources among different business units
and makes it possible to compare many business units at a glance. But BCG Matrix is not free
from limitations, such as-

1. BCG matrix classifies businesses as low and high, but generally businesses can be
medium also. Thus, the true nature of business may not be reflected.
2. Market is not clearly defined in this model.
3. High market share does not always leads to high profits. There are high costs also
involved with high market share.
4. Growth rate and relative market share are not the only indicators of profitability. This
model ignores and overlooks other indicators of profitability.
5. At times, dogs may help other businesses in gaining competitive advantage. They can
earn even more than cash cows sometimes.
6. This four-celled approach is considered as to be too simplistic.
Portfolio Analysis In Strategic Management
March 9, 2021
What Is Portfolio Analysis In Strategic
Management?
Portfolio analysis in strategic management involves analyzing every aspect
of product mix to identify and evaluate all products or service groups offered
by the company on the market, to prepare the detailed strategies for each part
of the product mix to improve the growth rate.

It can also be used to make a strategic decision about strategic business units.
Portfolio analysis in strategic management has, as its major objective, the
optimal gathering of the resources among the business activities comprising a
diversified business portfolio.

Topics Below
What is portfolio analysis in strategic management?
What is the Portfolio Analysis?
Reasons For Portfolio Analysis
Business Portfolio Analysis
Process For Portfolio Analysis in Strategic Management
Portfolio Management
Methods for portfolio analysis In Strategic management
Project Portfolio Management
Product Portfolio Strategy

What Is The Portfolio Analysis?

Portfolio analysis is a process of examining all the aspects related to the
organization to improve the organization’s profits.

Portfolio analysis aims to identify the components that need to be enhanced

to remove barriers from making the working process recognize better
methods to allocate resources to improve the return on investment(ROI).

Reasons For Portfolio Analysis

A different purpose for conducting a business portfolio analysis in strategic
management. The three main reasons why management focuses on business
portfolio analysis in strategic management, which are:

Reasons
For Portfolio Analysis
1. Analysis

The organization’s first reason to conduct a portfolio analysis in strategic

management is to determine every product mix’s current position and
determine which SBUs (strategic business unit) need more or less investment.
Management needs to create the organization’s entire portfolio to analyze the
present opportunities and threats to the market and the product.

2. Formulate Growth Strategy

Another aspect that management wants to formulate from the portfolio

analysis in strategic management is the growth strategy. According to other
products and markets, they develop a different strategy according to their
potential threats and opportunities. Portfolio analysis in strategic management
helps in laying down the strategy of expansion as well

3. To Take Decisions Regarding Product Retention

Another reason for corporate portfolio analysis in strategic management is to
determine the life of the product i:e, to determine which product should be
retained longer and which product should be removed from the product line.

These are the three primary and basic reasons for the portfolio analysis in
strategic management.

Business Portfolio Analysis

Business Portfolio Analysis in strategic management gives importance to the
development of strategies equal to the handling of investment portfolios. It is
based on the theory of organisational strategy build-up techniques.

Business Portfolio analysis in strategic management shows systematic ways to

interpret product and service that form a part of business portfolio analysis.
The way in which the financial investments of the firms are treated likewise the
appropriate organisational activities should be followed and the inappropriate
ones should be disregarded.

Basically, business portfolio analysis forms a part of portfolio analysis in which

the company emphasizes that the corporate strategies form a significant part
of the decision making for the future accomplishment of the goals.

Process For Portfolio Analysis In Strategic

Management
Portfolio analysis in strategic management process in an organization is as
follows:
 Process
For Portfolio Analysis in Strategic Management
Step 1: Identify Lines Of Business

The first step of business portfolio analysis in strategic management is to

identify all the current business lines and strategic business units.

Step 2: Group Lines Of Business

An organization has three levels of business operation, which are:

 broad membership – directly support the objectives in the

strategic plan
 support functions – deliver the core business benefits to
members
 money-makers – the source of revenues which support core
businesses
Step 3: Compare Core Businesses With Mission
After separating the activities, the next step in portfolio analysis in strategic
management is to compare the core starts with vision and mission and
defined goals and objectives. The business should directly support the
statements. If the comparison differs, then companies should discontinue
allocating the resources in that sector.

Step 4: Define Products In Each Line Of Business

The next step of portfolio analysis in strategic management is to categorize

each relevant product line I;e, subdivide, and define each product relevant
product line.

Step 5: Apply The Program Evaluation Matrix

The Program Evaluation Matrix helps in determining the fundamental question

of portfolio analysis in strategic management, which are:

 Good fit with our other programs?

 Easy to implement?
 Low alternative coverage in the marketplace?
 Is competitive position strong?
Step 6: Determine The Alternatives

At this stage, identification of alternatives is made i:e the competitors.

Identification of similar products and their coverage area in the market. And
the coverage is classified into:

 Low coverage – few comparable programs offered elsewhere.

 High coverage –many similar programs are offered elsewhere.
Step 7 Determine Program Fit

Ideally, the association will be segregated into two types of programs:

1.Well-fitting, accessible programs where the association has a strong

position and competes aggressively for a dominant position.

2. Well-fitting, difficult programs with low coverage that the association has
the unique, strong capability to provide to essential stakeholders.
This is the repeat process of portfolio analysis in strategic management which
takes place in an organization.

Portfolio Management
Portfolio Management explains a process in which individuals’ investments are
managed in order to maximise their earnings given a definite time period.
Also, it is kept in mind that the invested capital is not exposed to market risk
after one limit.

This process of portfolio management depends entirely on the ability to fluctuate with sound decisions. In brief,
portfolio management relates to allocating assets and diversifying the resources as per the risk in order to
achieve a profitable investment mix.

Initially, portfolio management is a way out of SWOT ( strength, weakness,

opportunity, threat) analysis of various investment avenues in comparison to
investors’ risk appetite and goals. As a result, this helps the investors to earn
and protect them from favourable risks.

Objectives Of Portfolio Management

The objective of portfolio management is to select from different investment
avenues that best suits the investor depending on various demographic
factors like income, time period, age and risk.

 Risk optimisation
 Ensuring flexibility of portfolio
 Allocating resources optimally
 Maximising returns on investment
 Capital appreciation
 To improve the overall proficiency of the portfolio
 Protecting earnings against market risks
Types Of Portfolio Management
Portfolio management can be broadly classified into 4 types which are as
follows :

1. Active Portfolio Management

2. Passive Portfolio management
3. Discretionary Portfolio Management
4. Non – Discretionary Portfolio Management

Types Of Portfolio Management

Active Portfolio Management

This kind of portfolio management is typically aimed at maximising returns.

The portfolio manager puts a significant amount of resources into the
exchange of securities. Simply the portfolio manager purchases the stocks
when undervalued and sells them on the increment of their value.

Passive Portfolio Management

This type of portfolio management aims at fixed profile designs that are
complementary to the current market trends. The portfolio manager here likes
to invest in funds with a long run approach and low but steady returns.

Discretionary Portfolio Management

This portfolio management is typically based on the authority of the portfolio
manager and is entrusted to invest on the investor’s behalf. This should be
kept in mind that the portfolio manager takes into consideration the risk
appetite and goals of the investors and then makes the decision to choose the
respective investment strategy whichever is suitable.

Non – Discretionary Portfolio Management

This type is totally opposite of what has been studied in just above portfolio
management. Here the portfolio manager just does the advisory part of
investment choices. In this situation is it the choice of the investor whether to
take it or reject it. Portfolio management in this case is a suggestion from
financial experts to take an opinion from portfolio managers before
disregarding them.

Methods For Portfolio Analysis In Strategic

Management
Methods of portfolio analysis are different as it depends upon the purpose
and product. Here are different methods for portfolio analysis in strategic
management:

1. Technological portfolio

2. BCG Growth-Share Matrix

3. Hofer’s Product-Market Evolution Matrix

4. GE Multifactor Portfolio Matrix

5. Market Life Cycle-Competitive Strength Matrix

6. Ansoff’s Product-Market Growth Matrix

7. Arthur D. Little Portfolio Matrix

Project Portfolio Management

Project Portfolio Management is based on the forecasting technique of
proposed or current projects. It is a source used by project management
 organisations and project managers to take into consideration or interpret the
potential return occurring out of a project.

Project portfolio management aims at focussing on the right potential projects

at the right time. They talk more about the delivery and execution of doing the
projects right. The project portfolio management involves the analysis of every
piece of data of the project which look forward to investing in newer projects.

Project Portfolio management enables different people to view the bigger

picture :

 Executives
 Project managers
 Team managers
 Stakeholders

Talking in brief project portfolio management forms a foundation for

more effective project management. While the project management
takes into account just an individual’s project, the project portfolio
NOTE: management takes into consideration every potential project and current
Distinguish between projects along with its commitment to meet the business goals.
project portfolio Here are a few ways when portfolio management supports project
management and project management:
management. i) helps to assign value in order to make project budgets firm
ii) forecasting prioritizes the managers to make proper schedules
iii) helps to ignore the bad projects as compared to the valuable ones to
protect from the project management disasters.

Product Portfolio Strategy

Product portfolio strategy refers to the list or series of all services and
products which are offered by the company. Every business is different and
therefore they all have individual ways to schedule their product template and
product portfolio strategy. The process of product portfolio strategy involves a
variety of decisions.

The Role Of Product Portfolio Strategy In Strategic

Management
The role of product portfolio strategy is that every product or service whether
tangible or intangible is unique and requires a special system. The products
can include travel, differ in different situations or include services that need
special attention while delivering.

Products can be anything made for the target market and in return provides
profits or benefits to the company, organisations, people or ideas etc.









Strategic portfolio analysis involves identification and evaluation of all products

or service groups offered by company on the market (so called product mix) and
preparing specific strategies for every group according to its relative market share and
actual or projected sales growth rate. It can be also used to make strategic
decision about strategic business units.

Portfolio analysis in strategic management allows to answer key questions how to

shape the present and future business portfolio (of product or services) in order to
reduce the risk of functioning in a changing environment, and increase the effects of the
implemented strategy.
Fig. 1. BCG growth-share matrix - one of the most popular strategic portfolio analysis
method

Methods of portfolio analysis used in strategic

analysis
 Technological portfolio

Technological portfolio is one of the methods used in the analysis of development

opportunities of the company. Development of this method and its raise in popularity
was due to continuous development of products, stronger competition and rapidly
changing technology. Quick change in technology contribute to the fact that not
every product has the time and ability to generate excess financial surplus. Often this
causes crowding out products that have the largest market share. In this situation, it is
considered appropriate to use portfolio analysis methods.

Technological portfolio is determined on the basis of the position in life cycle of

the technology, the degree of attractiveness of future technology and the size of
the production potential of the company. It is measured on the basis of the comparative
studies of the company and its competition. The criteria for this evaluation are: the
possibility of developing the technology, process of dissemination of technology, level
of standardization, possibility to use technology in a variety of production fields, or the
versatility of the technology, time and cost needed for its development and
implementation.

Stages of design of technological portfolio

 the grouping of products according to technology used,
 determine the level of attractiveness of technology,
 to develop a forecast of anticipated technological changes in the industry and
related sectors,
 determine the level of production with current technology
  estimation of the level of risk arising from the loss of technological advantage
over competing companies
 evaluation of the applicability of specific policies in the enterprise in the field
of research and development

The technology is attractive in situations where its application causes a reduction in costs
as well as enhance the quality of products. The attractiveness of the technology and its
skillful use is the basis for portfolio creation and according to these guidelines, the
company can make a variety of decisions, for example: invest in technologies
implemented with medium or large mastery, select and reject badly applied
technologies. The concept of technological portfolio encourage managers to
take action adjusted to the requirements of the market, as well as to cope with the
competition.

 ADL matrix

ADL matrix is a portfolio analysis technique. It was created in the seventies

at consulting firm Arthur D. Little, Inc..

It is based on the assumption that the ability of the product to generate profit is
consequence of on the one hand, the competitive position of the company, on the other
hand the degree of maturity of the sector. This means that the product has a greater
ability to generate a surplus if it has a stronger competitive position.

According to many authors, the source of market success of the company are mainly
product innovations. They allow for the development of all units within company beyond
its competitors and achievement of leading market position. These are mostly products
in the mature and declining sectors.

ADL matrix structure

The design of ADL matrix is based on two variables:

 Degree of maturity of the industry (market)

 Degree of competitiveness of a product or company's competitive position.

Fig.1 ADL matrix

maturity of sector \ competition start-up growth maturity decline

leading
strong
favorable
unfavorable
marginal

Source: "The strategic analysis of the company" M. Romanowska, G. Gierszewska

Phases of sector maturity

Maturity size sector is composed of four phases:

 Start-up,
 Growth
 Maturity,
 Decline.

Types of competitive position

There are five dimension of competitive position:

 Leading - provides the ability to control the behavior of competitors,

 Strong-enables policy-making in the field of your choice without
compromising its position in the long term,
 Favorable - gives a good chance of implementation of the strategy and
maintain its position in the long term,
 Unfavorable - justifies the continuation of the activity, if the results are good
enough, allows the use of general tolerance of strongest competitors,
 Marginal-gives a chance to improve the situation despite the unsatisfactory
results, but improvement must be significant.

ADL matrix comprises from 20 to 30 fields, depending on the number of analyzed

phases. In these fields circles are placed that reflect homogeneous products or product
groups. This allows managers to make a proper allocation of resources and control of
product strategies. This results also in the development of the optimal product portfolio
of most profitable products.

ADL matrix is connected with natural strategies and strategic trajectories. In Figure 1
lines divide the area into: strong, questionable and weak sectors.

Strategic trajectories
Trajectories show the process of the strategic development of the company in different
sectors depending on the scenario of success and failure.

Fig. 2 Strategic trajectories

 start-up growth maturity decline
leading Success
Strong
favorable
Unfavorable
Marginal Failure

Source: "The strategic analysis of the company" M. Romanowska, G. Gierszewska

Advantages of ADL matrix

 Transparency,
 Flexibility in assessing the attractiveness of the industry,
 Possibility of balancing a portfolio of production,
 Better identification of competition, suppliers, customers, potential
substitutes,
 Allows to extract the strengths of the product portfolio.

Disadvantages of ADL matrix

 Limited practicality,
 Excessive empiricism and subjectivity in the application of the criteria for
designation of its main dimensions.

 BCG matrix

 BCG Growth-Share Matrix (also known as BCG model, Boston matrix, BCG
matrix, BCG analysis, or Boston Box) was developed by Bruce Henderson in the
early 1970s for Boston Consulting Group, world
known management consulting company. The Boston Consulting Group
matrix presents different business units or major product lines based on
their relative market share and the growth rate of the market. The model is useful
in brand marketing, strategic management and production
management and business portfolio analysis.

 Content of the BCG growth share matrix

 After using method of calculating the BCG matrix two main variables are placed
along the axes (Fig. 1) describing bcg portfolio:
 Market growth - Y axis
 Market growth is represented by the vertical axis. The axis is divided into two
segments: more and less than 10 percent growth per year. A market
growth above 10 percent is considered high Therefore, this variable symbolizes
the attractiveness of the market.

 Relative market share - X axis

 Relative market share is represented by the horizontal axis. It is company's market
share divided by the share of its biggest competitor. Relative market share serves
as a measure of the company's strength in the relevant market segment.
 The limiting value is at 1: a value greater than 1 implies that a company has the
largest relative market share and therefore is the market leader. A relative market
share of 0.1 means that the company's sales volume is only 10 percent of the
leader's sales volume; a relative share of 10 means that the company's strategic
business unit (SBU) is the leader and has 10 times the sales of the next-
strongest competitor in that market. The highest value typically is defined on the
left, and the lowest on the right.


 Fig. 1. BCG growth-share matrix

 In portfolio matrix four types of products can be distinguished, depending on the

placement of a product-market combination in one of the four quadrants:

 Stars
 These are products with a high market share in a strongly growing market. The
cash resources used for and the cash resources required by these products are
both high and therefore in principle are in balance. After some time all growth
slows. This is the reason, why stars become finally Cash Cows if they keep their
market share. If they will not be able to hold the market share, they will become
Dogs.
 Cash Cow
 These are products with a high market share in a market that is not growing very
much. As a result of the strong market position, they produce many cash
resources, and they require few investments because of the limited market
growth.

 Question Marks
 These products (also called Problem Children or Wild Cats) have a small market
share in a rapidly growing market. As the name indicates, they have unsure and
questionable situation and can create problems: they produce little but require a
lot of cash resources. If they are able to strengthen their position, they can
become stars and over time, when market growth decreases, cash cows.

 Dogs
 These are products with a low market share in a market that is growing very little.
Therefore, they produce little but also require few investments. That means that
the cash resources used for and the cash resources required by these products
are both low and for that reason are in balance. Dogs are worthless cash traps,
they do not bring sufficient profits for a company.

 Strategic recommendations based on product

portfolio matrix
 Based on the BCG analysis and above described product market matrix, company
has to decide what objective, strategy, and budget should be assigned to
each SBU. Several general investment strategies may be recommended.

 Growth (Build) - strategy

 For some Question Marks a company may use a growth strategy financed by
Cash Cows
 The part of the Cash Cows' revenues would strengthen the positions of Question
Marks that have the potential to become Stars. In that case, a company increases
its market share substantially.

 Maintain position (Hold) - strategy

 The strong positions of the Stars and the Cash Cows should be maintained.
  Also, if the Dogs have a sound size, they may be an important part of a
company's activities. In that case, a maintenance strategy appears also to be
promising.

 Harvest or milk - strategy

 The main aim of this strategy is to rise short-term cash flow despite the long-term
consequences. Harvesting implies a decision of getting out of a business by
executing a program of constant cost cutting. Companies use this strategy when
they expect to reduce their cost at faster rate than potential fall in sales. This
strategy is suitable for weak Cash Cows, Question Marks and Dogs. The
recommendation for the Dogs is to milk them and remove them from the market.

 Liquidation (Terminate, Divest) - strategy

 If a company runs a weak business, it should consider weather to harvest or divest
its business units. The decision of liquidation gives a company the opportunity to
reinvest its resources in a more prosperous business. This strategy is appropriate
for the Dogs and the rest of the Question Marks, which are not financed by the
Cash Cows.

 Hofer matrix

Hofer matrix is one of the tools used to determine the assessment of the Competitive
position of the company, as determined by its internal and external factors.

15 squares matrix was created by Ch.W. Hofer. It is a development of

the ADL and McKinsey matrices and is especially useful when analysing strategically
diversified entity.

Rules of design
Matrix is created on the basis of two criteria: the maturity of the sector, divided into 5
phases and the competitive position of companies in the sector. In this way circles are
created, which represent different areas of activity in the company, and the size of the
circle is proportional to size of the sector. Sometimes segments could be added to the
circle, which reflect the market share of company in the sector.

Below is a sample matrix constructed according to the principles set out by Hofer. In its
interpretation attention should be paid to possible strategies for products, their life
cycle phases and the markets in different sectors.
Fig.1. Hofer matrix example

Interpretation of fields
In Hofer matrix, we can characterize groups of products:

 Products A - Dilemmas that have chance of success with

appropriate marketing strategies and financial aid
 Products B - Winners, require appropriate marketing strategies and financial
aid, if company has limited resources for advertising managers must make a
choice between products A and B
 Products C - Potential losers, the weak position, the sector in the growth
phase - managers should make additional analyses to rule out the possibility
of going through the shock phase
 Products D - despite the current difficulties can become market leaders or
profitable producers
 Products E and F are profitable, so it is possible to introduce other products in
the phase of shock and generate considerable profits
 Products G and H are the losers are in the exit phase of the market, ahead of
the full withdrawal managers should use strategies for "gathering the harvest"

McKinsey matrix / GE matrix

McKinsey matrix (other names: matrix

of product attractiveness, market attractiveness matrix, GE matrix) dates back to the
seventies. Is used to determine the success factors of the company in the form
of industry attractiveness and competitive position within the industry.

Assumptions used for creating McKinsey/GE

matrix
The main assumptions of the McKinsey matrix structure:
  company should operate in the sector more attractive, while eliminating the
products from the less attractive,
 company should invest in products with a strong competitive position, and
withdraw from those in which its competitive position is weak.

The method is also called McKinsey nine-field analysis (9W analysis) of the
company's production portfolio. This matrix consists of two variables:

 attractiveness of the industry,

 assessment of the competitive position and financial strength of the
company.

Stages of evaluation of attractiveness of the industry

1. Identification of criteria for the attractiveness of the industry and the
market size.
2. Weighing of ratings (sum of the weights of all criteria is 1).
3. Evaluation of each industry on scale from 1 to 5 meaning: 1-unattractive,
5-industry very attractive.
4. Interpretation of the final result of the attractiveness evaluation.

Stages of evaluation of competitive position

Assessment of the competitive position of the company has following stages:

1. Identification of the factors of success of the company.

2. Weighting of relative factor importance.
3. Evaluation of competitiveness on scale from 1 to 5 meaning: 1-weak
competitive position, 5-strong position.
4. Interpretation of the estimated ratings.
Fig. 1 Interpretation of the company's position in the matrix

Principles for GE/McKinsey matrix interpretation

On the Y axis, which determines the level of attractiveness, we denote the attractiveness
of each of the industries. X-axis mark strategic positions of the company. The
intersection of the two dimensions determine the point, which is the centre of a circle,
meaning the company position (fig. 1.).

Circle size is dependent on the size of the production. Inside the circle segments are
drawn, which determine the size of the market share of the product. The distribution of
products in the matrix informs us about the strategy that should be used.

Advantages and disadvantages of GE/McKinsey

matrix
Advantages:

 flexibility in assessing the attractiveness of the industry,

 greater possibility of balancing a portfolio of production.

Disadvantages:

 subjective criteria for evaluation (assessment is more focused on the present

and not the future competitive position of the company).