Strategy & Planning

BCG Matrix

Plot products or business units by market growth and relative market share to decide where to invest and where to harvest.

How to use this worksheet
  1. List each product or business unit with its market growth rate (percent per year) and relative market share. Relative share is your share divided by the share of your largest competitor.
  2. Add revenue to size the bubbles. Use the same period for all products.
  3. Read the chart: stars get investment, cash cows fund the rest, question marks need a decision, dogs are candidates to divest.
  4. Drag bubbles to test what a different share or growth would mean.
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Products and business units

One row per product. Relative share 1.0 means you are as large as your biggest competitor.

Prompts

Ask yourself

  • Is the market defined the way your customers see it?
  • Which question marks could become stars with investment?

Growth-share matrix

Before you finish

About the BCG matrix

Bruce Henderson of the Boston Consulting Group introduced the growth-share matrix in 1970. High share in a growing market makes a star; high share in a slow market a cash cow.

The model is simple on purpose, and it is often criticised for ignoring synergies and for how markets are defined. Treat it as a discussion tool for portfolio balance.

Recommended reading

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