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As Steve Jobs, CEO of Apple, famously put forward, "Innovation distinguishes between a leader and a follower." The Growth-Share Matrix is a pathway to such transformative leadership. It denotes an innovative model that aids Strategic Planning, guiding C-level executives like yourself in better portfolio management.Learn more about Growth-Share Matrix.
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Growth-Share Matrix Overview Understanding the Growth-Share Matrix Application of the Growth-Share Matrix Unleashing the Power of the Growth-Share Matrix Challenges and Adaptation of the Growth-Share Matrix Revolutionizing Management Decisions via the Growth-Share Matrix Growth-Share Matrix FAQs Recommended Documents Flevy Management Insights Case Studies
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As Steve Jobs, CEO of Apple, famously put forward, "Innovation distinguishes between a leader and a follower." The Growth-Share Matrix is a pathway to such transformative leadership. It denotes an innovative model that aids Strategic Planning, guiding C-level executives like yourself in better portfolio management.
For effective implementation, take a look at these Growth-Share Matrix best practices:
The Growth-Share Matrix harbors two dimensions: Market Growth Rate, which assesses the attractiveness of the business environment, and Relative Market Share, a measure of your advantage/superiority to competitors. It classifies businesses or products into four distinct categories or quadrants: Stars, Cash Cows, Question Marks, and Dogs. In Reality, each category represents a specific strategic objective that you need to consider as you work towards maximizing your company's overall value.
The power behind the Growth-Share Matrix lies in its versatility. To apply the methodology, you segment your company's Strategic Business Units into the four quadrants:
Used correctly, the Growth-Share Matrix offers valuable insight into your current product portfolio and crucial context for making strategic decisions. Here are some key principles for optimizing your use of the tool:
Explore related management topics: Digital Transformation
No strategy tool comes without limitations. In the case of the Growth-Share Matrix, your company needs to be careful when interpreting the market leadership data relating to Relative Market Share. Overemphasis on market-share leadership can lead to an unbalanced portfolio, while ignoring the importance of cash-flow generation and profit margins.
Additionally, low market share does not necessarily signify a lack of profitability. Thus, the interpretation of 'Dogs' should tread on careful lines.
The Growth-Share Matrix, with its business portfolio analysis capabilities, can function as a catalyst in Driving Organizational Change. Its real value surfaces when you use it to reconfigure your company's Strategy Execution process, leading to a more robust Operational Excellence Culture.
Moreover, the Growth-Share Matrix serves as a vital tool in today's data-driven world—enabling comprehensive Performance Management and Risk Management. It is a powerful strategic tool to manage the multitude of dilemmas you encounter in the complex dynamic business environment.
Explore related management topics: Operational Excellence Organizational Change Performance Management Risk Management Strategy Execution
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