Global Strategy Portfolio Analysis

Question: Discuss about theGlobal Strategyfor Portfolio Analysis. Answer: Introduction It is important that one carries out exhaustive and thorough background checks when it comes to company analysis. Through this, they will be able to understand the nature, implications and the importance of business matrix and all the details that describe the same. Notably, the Boston Matrix was devised for purposes of attaining the best marketing practices and as such, achieves this move by plotting the relative market growth against market share. This is then meant to provide corporate strategic planning as a means of assessing the different SBUs in various markets (Whipp, 1999). This is why Wesfarmers has every reasons to adopt this strategy for the betterment of the anticipated results. A product life cycle refers to the period the product takes to appeal to the customers. Within this period, five stages take centre stage. The stages include an introduction, growth, maturity, saturation and decline of the product in the consumers radar (Payne, Lumsden, 1987). The BCG Matrix is one that demonstrates market growth, that is, the market share matrix that is developed by Boston Consulting Group used in supporting the strategic decisions so as to optimize the business portfolio with respect to the new, ancient, established or innovative products of the business and or the strategic business units, otherwise known as SBU (Fiocca, 1982). The underlying theories of this matrix are the product life cycle and the experience curves. Having the strategic business units in place, it becomes important for the target company to come up with its individual strategies for the set SBUs. Application of the Matrix: Business Analysis Portfolio The tool: the BCG growth-share matrix was devised under the umbrella of the experience curve. How to achieve it: the growth rate of each of the business unit is calculated on an annual basis. This is then plotted or linked to the matrix depending on the possibility of the matrix capturing the growth be it low or high. Below is an Illustration of the Matrix The future decisions with regard to the matrix include steps on how to allocate the investments on SBUs taking into account the fact that it is important to have an analysis of the respective products based on their potential to give profits or die out (Charles, et al., 1984). The other important thing here should be the need to develop SBUs and new products. When all is said and done, it becomes critically important to have such considerations as PIMS database being in place as it supports the BCG matrix (Udo-Imeh, et al., 2012). As a matter of fact, the high market share in the growing market costs like the Business units are known to have a decrease in the rate over time relative to other competitors. One of the strategies that can be employed in this case is the strategy of growth, as indicated above. When carefully scrutinized, it becomes apparent that the strategy reduces the costs and investments thereby maximizing the profits and short-term cash flows. Question mark strategy is another approach where the SBU is seen to assume an exponential growth without having high market share (Payne, Lumsden, 1987). At this point, clever yet sufficient investment is necessary so as to increase the market share. There is also an offensive strategy that is viewed as an important strategy to increase the market share in the sense that it brings with it the promise of offering huge returns. References Fiocca, R. (1982). Account portfolio analysis for strategy development. Industrial Marketing Management,11(1), 53-62. Charles J. Fombrun, Tichy, N. M., Devanna, M. A. (1984).Strategic human resource management(pp. 403-419). New York: Wiley. Whipp, R. (1999). Creative deconstruction: strategy and organizations.Managing organizations: Current issues, 11-25. Whipp, R. (1999). Creative deconstruction: strategy and organizations.Managing organizations: Current issues, 11-25. Udo-Imeh, P. T., Edet, W. E., Anani, R. B. (2012). Portfolio analysis models: a review.European Journal of Business and Management,4(18), 101-117. Payne, A., Lumsden, C. (1987). Strategy consultingA shooting star? Long Range Planning,20(3), 53-64.