Professional Documents
Culture Documents
Corporate Strategies For Growth
Corporate Strategies For Growth
The payoff from growth must come from when growth slows
down, or it never will. The payoff is cash that cannot be
reinvested in that product / business.
Portfolio Matrix for
Mead Corp
Savings
high Select Divest the
Bank
a few others
Sweepstakes
Invest if needed
to create Cash Cow
low Liquidate
Bonds Mortgages
high low
Relative Position (Market Share)
Cash demands of
Cash products.
Usage
The development cycles of
product
Potential
in the
market Resource allocation and
divestment decisions
Cash Generation
Competitive Position
RELATIVE MARKET SHARE
RMS = Your business unit sales this year
Leading rival sales this year
Cash Cows 13 9
Stars 3 5
?? 60 51
Dogs 24 35
Share of Profits
Turnaround or Turnaround,
Weak Up or out. abandon. orphaned out Abandon.
withdrawal.
Lipton Treetop
LIMITATIONS
There is no standard life cycle length.
Determining the current industry life cycle phase is
difficult. (Post recession of 2008 -09 and a short period of growth
2010 – 2012/13, are we again heading for a slow growth period?)
Competitors may influence the length of the life cycle.
The Internal-External Matrix
External factors evaluation
Opportunity Wt. Rating Weighted Score
1-4
Demand
Income up
Threat
US QE tapering
Rentals
Internal Factors Evaluation
Opportunity Wt. Rating Weighted
1-4 Score
Inventory T/O
fm 5 - 7
ABV 97 - 120
PSFT 25 - 50
Threat
Location
Supply lead
time
Competitive Profile Matrix
Factors Weight Rating Co. 1 Co. 2 Co. 3
1-4
Advtg
Distribution
Product Qlty
Price
competiveness
Financial Position
Market Shares
Brand Loyalty
Index
SPACE Analysis
Stands for Strategic Position and Action Evaluation.
A tool to help determine the appropriate strategic posture
of a firm.
Involves plotting competitive advantage, industry strength,
financial strength, and environmental stability on a two-
dimensional graph.
comprises a number of factors that are evaluated independently
and then combined to yield an average score.
The resulting plot could end up favouring one of four quadrants
(the strategic postures), which are aggressive, competitive,
defensive, and conservative
Confidential
In a market which is stable Typical in a very attractive
with low growth. Focus Plotting the strategic point
industry without environmental
uncertainty. Financial strength
should be on financial
stability and product helps protect the company's
competitiveness. Common competitive advantage. Risk of
practices : prune product entry of new competition.
line, reduce costs, cash flow Common practices : explore new
improvement, protection of opportunities, acquisitions,
competitive products, new increase market share, and focus
product development, and resources on products that have
entering more attractive a competitive advantage.
markets.