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CS Professional · Strategic Management and Corporate Finance · Managing the Multi-Business Firm and Analyzing Strategic Edge

Sagar Industries has four units. In the BCG matrix, Unit P has high relative share in a slow-growth market, Unit Q has low share in a fast-growth market with uncertain future, Unit R has high share in a fast-growth market, and Unit S has low share in a slow-growth market. Which allocation of roles is correct?

P is a cash cow, Q a question mark, R a star and S a dog. High share with slow growth generates cash, low share with fast growth is uncertain, high share with fast growth is a star, and low share with slow growth is a dog.

  1. AP is a cash cow, Q is a question mark, R is a star, S is a dogCorrect
  2. BP is a star, Q is a dog, R is a cash cow, S is a question mark
  3. CP is a cash cow, Q is a star, R is a question mark, S is a dog
  4. DP is a question mark, Q is a cash cow, R is a star, S is a dog

Explanation

High share and low growth gives a cash cow (P). Low share and high growth gives a question mark (Q). High share and high growth gives a star (R). Low share and low growth gives a dog (S). The other options swap the axes.

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