The Boston Consulting Group(BCG Matrix)
What is it?
Is a large consulting firm that endured the recent economic downtown without laying off any employees and hired the most new consultants even, also it allows a multidivisional organization to manage its portfolio of businesses by examining the relative market share position and the industry growth rate of each division relative to all over divisions in the organization.
The relative market share position is defined as the ratio of a division’s own market share in a particular industry to the market share held by the largest rival firm in an industry.
Question Mark:
Market Penetration, Market Development, Product Development and Divestiture.
Have a low relative market share and compete in a high-growth industry.
Star:
Backward, Forward, or horizontal integration. Market penetration, Market development and Product Development.
Have a high relative markets share position and high growth rate.
Cash Cow:
Product development, Diversification, Retrenchment and Divestiture.
High relative market share and low growth rate.
Dog:
Retrenchment Divestiture and Liquidation.
Low relative market position and a low relative market share position.
Where we are?
Being in a new market and in a new industry, we don’t know how well we are going to be receive in the industry; also we must decide whether to strengthen them by pursuing an intensive strategy or product we are going to sell.
Why Question Mark:
In our company we must have a low relative market share by the market penetration and development that we must be implementing, being a question mark is going to be challenge because the main organization has to decide whether to strengthen by pursuing an intensive strategy that includes the market development and the way we are going to sell it.
We must not be a Dog; we are not implementing Liquidation in the company.
The cash cow is being similar to the question mark but in cash cow Retrenchment is going to be implemented an in our business is not necessary, we need to grow and expand in the industry.
The star includes the market development, penetration and product development but constantly is doing a backward , we are beginning so we can’t see the action and error made in the past, how to correct them also and a forward or horizontal integration