Verified Document

Bcg Matrix Strategic Management The Bcg Matrix: Research Paper

BCG Matrix Strategic Management

The BCG Matrix: An overview and a hypothetical situation

The Boston Consulting Group (BCG) Matrix is an efficient way to visually represent a company's portfolio of goods and services, and provides a way for organizations to evaluate their strategic possibilities. The BCG Matrix classifies a company according to three primary business interests or units (BCG Matrix, 2012, Net MBA). The Matrix is represented in the form of four quadrants: stars, question marks, dogs, and cash cows.

tars,' which are located in the upper left quadrant of the BCG 'box,' are relatively self-explanatory. They are popular goods and services with a large market share. However, the problem with stars is that they are very demanding, cash-wise and time-wise, for the organization (much like 'stars' in real life, hence the name). The organization profits off the branding and positive buzz that stars generate but the stars generate little real cash (BCG Matrix, 2012, Net MBA). The hope is that through economies of scale, a star can eventually become a 'cash cow.' Dogs, located in the lower right...

They do not divert many resources from the organization, but they are simply not worth the money required to sustain them. Dogs are not costly -- but not very profitable either (BCG Matrix, 2012, Net MBA).
In this scenario, however, the question of how to deal with 'cash cows' and 'question marks' is at issue. The company's electronics division is located in the upper right quadrant of the matrix as a question mark and the appliance division appears in the lower left quadrant of the matrix as a cash cow. Cash cows are the bread and butter of company and create more cash than required to sustain them (BCG Matrix, 2012, Net MBA). Cash cows must be 'milked' or used to generate the maximum amount of cash possible to fund other ventures. A company cannot remain 'sitting still' in the midst of contentious market activity, particularly a technologically-oriented company, and must always keep its eye upon the potential to generate the 'next new thing,' just as Apple is always trying to create…

Sources used in this document:
References

BCG Matrix. (2012). Net MBA. Retrieved:

http://www.netmba.com/strategy/matrix/bcg/

Paschal, Peter. (2012). Half of U.S. households have Apple products. CNN. Retrieved:

http://www.cnn.com/2012/03/29/tech/gaming-gadgets/household-apple-products/index.html
http://www.prlog.org/11820444-us-consumer-electronics-devices-market-projected-to-be-worth-us-2939-billion-by-2016.html
Cite this Document:
Copy Bibliography Citation

Related Documents

Strategic Management in Action
Words: 2276 Length: 8 Document Type: Case Study

Strategic Management Action: Strategic Position, Choices, And Strategy Implementation Strategic management is stated to be the "process by which an organization formulates its objectives and manages to achieve them. Strategy is the means to achieve the organizational ends." (Thomas, nd) Managers are required to have a strategic vision in order to become strategic managers and implement strategic management initiatives. The strategic vision of the manager is inclusive of the following elements: (1)

Strategic Management at Mcdonald's Strategic Management Strategic
Words: 5918 Length: 22 Document Type: Essay

Strategic Management at McDonald's McDonald's Strategic Management Strategic Management at McDonald's Strategic Management at McDonald's McDonald's: Introduction Organizational Structure and Corporate Governance Industry Sector Analysis Michael Porter's Five Forces Model Key conditions in the External Operating Environment of McDonald's and its Industry The Value Proposition on McDonald's Products Financial Performance SWOT Analysis for McDonald's TOWS Matrix for Alternative Strategies BCG Growth Share Matrix for McDonald's Marketing, Financial, and Research & Development Strategies McDonald's Leadership Joint Ventures, Strategic Alliances, and Partnerships Performance Measurement Methods and Benchmarks Recommendations References Table of Contents Sr.

Strategic Management and Planning Strategic
Words: 1992 Length: 7 Document Type: Term Paper

Strategic Alternatives Addresses an External issue? Draws on a competitive advantage or fixes a competitive disadvantage? Fits with Mission, Values? Moves the organization toward the vision? Achieves one or more goals? Partner with a travel company to offer vacations that include dental surgery, plastic surgery, and vascular surgery. Supports the strategy of increasing global reach of the company and strengthening the ability to recruit physicians in key specialties. Draws on a competitive

Strategic Management It Is Very Important That
Words: 5480 Length: 13 Document Type: Term Paper

Strategic Management It is very important that the factor of 'change' figures within an organization prominently. Different people utilize different approaches to implement these changes, and most often, it is that particular method that suits the organization the best that is used. Among some of the tried and tested methods of implementing change within an organization is the 'Delta Technique', which is one of the more popular and extremely successful methods

International Strategic Management Costco Business
Words: 5051 Length: 12 Document Type: Term Paper

The strategy outlines clearly the ethical position of the organization in relation to interactions between consumers and various stakeholders. This is essential in the enhancement of service and products provisions. The organization focuses on the adherence to the law through development and implementation this marketing strategy. This enhances effectiveness and efficiency of the legal interaction between consumers, shareholders, and stakeholders. The organization also pledges to take quality care of

Strategic Planning in Education Every
Words: 3871 Length: 12 Document Type: Essay

General Electric (Collis, Montgomery, 2008) pioneered the development of this framework, working in conjunction with the Boston Consulting Group to tailor its specific market sizing and profitability measures to the conglomerate of businesses that comprised GE at the time. One of the key assumptions of the BCG Growth/Share Matrix is that there must be continual monitoring of the market, specifically competitors and relative market share growth over time. Only

Sign Up for Unlimited Study Help

Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.

Get Started Now