The purpose of the BCG Matrix (or growth-share matrix) is to enable companies to ensure long-term revenues by balancing products requiring investment with products that should be managed for remaining profits. The Boston Consulting Group (BCG) Matrix is a simple corporate planning tool, to assess a company’s position in terms of its product range. It is also referred to as the BCG growth-share matrix. By evaluating market share and market growth rate, the matrix provides a framework for making informed decisions about investment and resource allocation, and can help organizations to achieve sustainable growth and profitability.The Boston Consulting Group (BCG) Matrix is a portfolio management tool created in 1970 by Bruce Henderson. In conclusion, the BCG Matrix is a valuable tool for organizations looking to optimize their portfolio of business units. For example, stars and question marks should receive significant investment to maintain or increase their market position, while cash cows should be managed for cash generation and dogs should be divested or phased out. The BCG Matrix provides organizations with a framework to evaluate their portfolio of business units and to determine which units should receive the most investment and attention. These units require significant investment to increase their market share, but they have the potential to become stars if successful. Question Marksīusiness units with a low market share in a high-growth market are considered question marks. These units have limited potential for growth and generate little profit, if any. Dogsīusiness units with a low market share in a low-growth market are considered dogs. These units generate significant profits, but require little investment to maintain their market position.

Cash Cowsīusiness units with a high market share in a low-growth market are considered cash cows.

These units require significant investment to maintain their market position, but they also have the potential to generate substantial profits.

Starsīusiness units with a high market share in a high-growth market are considered stars. The BCG Matrix categorizes business units into four categories: stars, cash cows, dogs, and question marks. Market share is a measure of the organization's relative position in the market, while market growth rate represents the rate at which the market is growing. The matrix was developed by the Boston Consulting Group in the 1970s and is based on two key factors: market share and market growth rate. The BCG Matrix, also known as the Boston Consulting Group Matrix, is a strategic planning tool used by organizations to evaluate their portfolio of business units and determine which units should receive the most investment and attention.

What is bcg matrix