CS Professional · Strategic Management and Corporate Finance · Strategic Analysis and Planning
In the BCG growth-share matrix, a business unit of a Chennai conglomerate has a low relative market share in a market growing slowly. What is the label for this unit and the usual strategic suggestion?
The unit is a Dog, since it has low relative market share in a low-growth market. Dogs generate little cash and have weak prospects, so the usual suggestion is to harvest or divest them rather than invest further.
- ADog; harvest or divestCorrect
- BQuestion mark; invest heavily to build share
- CCash cow; hold and milk for cash
- DStar; invest to sustain growth
Explanation
Low relative share with low market growth is the 'Dog' quadrant. Such units generate little cash and are usually harvested or divested. Question marks have low share but high growth; cash cows have high share and low growth; stars have high share and high growth.
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