企業股份單的分析BusinessPortfolioAnalysisOutlineIntroductionBCG(BostonConsultingGroup)MatrixPIMS(ProfitImpactofMarketStrategy)GE(GeneralElectric)/McKinseyMulti-FactorMatrixIntroductionThecreationofSBUsenablesthesettingofSBU’smissionandobjectivesandtheallocationofresourcesacrossSBUsintheorganizationSeniormanagementneedtohaveaframeworktoevaluateSBUsandtoassignlimitedresourcesamongthem;henceportfolioanalysisManymodelsbutonly3arecoveredhere:BCG,PIMS,&GEmodelsBCG(BostonConsultingGroup)MatrixProvidesaframeworkforseniormanagementinallocatingresourcesacrossbusinessunitsinadiversifiedfirmbyBalancingcashflowsamongbusinessunits,andBalancingstagesintheproductlife-cycle(PLC)BCGProductPortfolioMatrixDimensionsRelativeMarketShare(LogScale)ProductSalesGrowthRateBCGMatrix(cont’d)ThehorizontalaxisistheRelativeMarketShareshowninalogscaleVerticallineisusuallysetas1.0RelativeMarketShareAnSBUtotheleftofthislinemeansitisthemarketleaderintheindustryorsegmentinwhichitoperatesConversely,anSBUtotherightofthisline(1.oRMS)meansitisnottheleaderBCGMatrix(cont’d)Theverticalaxisisthegrowthrate5levelsmaybeused:product,productlines,marketsegment,SBUandbusinessgrowthrateHorizontallineisusuallysetas10%GrowthRateSBUsabovethesetvalue(10%line)representshighgrowthratesConversely,SBUsbelowthisvaluedepictsslowergrowthrateMatrixQuadrantsHighLowHighLowProductSalesGrowthRateRelativeMarketShareKeyAssumptionsofBCGMatrixStablecost/pricerelationshipNotvalidifthefirmispricingonprojectedloweraverageunitcostsinthefutureMarketleaderinfluencestheaveragecostsProfitmarginisafunctionofmarketshareThisignoresprofitablenichesStrategicPerspectivesofProductsinDifferentQuadrantsFourdifferentstrategicperspectivesInvestmentEarningsCash-flow,andStrategyImplicationsQuestionMarks

(ProblemChildren)Investment—heavyinitialcapacityexpendituresandhighR&DcostsEarnings—negativetolowCash-flow—negative(netcashuser)StrategyImplicationsIfpossibletodominatesegment,goaftershare.Ifnot,redefinethebusinessorwithdrawStarsInvestment—continuetoinvestforcapacityexpansionEarnings—LowtohighearningsCash-flow—Negative(netcashuser)StrategyImplicationsContinuetoincreasemarketshare—evenattheexpenseofshort-termearningsCowsInvestment—CapacitymaintenanceEarnings—HighCash-flow—Positive(netcashcontributor)StrategyImplicationsMaintainmarketshareandcostleadershipuntilfurtherinvestmentbecomesmarginalDogsInvestmentGraduallyreducecapacityEarnings—HightolowCash-flowPositive(netcashcontributor)ifdeliberatelyreducingcapacityStrategyImplicationsPlananorderlywithdrawaltomaximizecashflowExleofaBCGMatrixforaFastenerSupplierinSouthEastAsiaHighLowHighLowProductSalesGrowthRateRelativeMarketShareAnchoringSystemsPowderActuatedToolsCableTraySystemsElectricPowerToolsConcreteLiftingSystemsNotethattheAnchoringSystemSBUisforecastedtomovetonewpositionBCGMatrix

(ThreePathstoSuccess)Continuouslygeneratecashcowsandusethecashthrow-upbythecashcowstoinvestinthequestionmarksthatarenotself-sustainingStarsneedalotofreinvestmentsandasthemarketmatures,starswilldegenerateintocashcowsandtheprocesswillberepeated.Asfordogs,segmentthemarketsandnursethedogstohealthormanageforcashThreePathstoSuccess(cont’d)HighLowHighLowMarketGrowthRateRelativeMarketShareBCGMatrix

(ThreePathstoFailure)Overinvestincashcowsandunderinvestinquestionmarks TradefurtheropportunitiesforpresentcashflowUnderinvestinthestarsAllowcompetitorstogainshareinahighgrowthmarketOvermilkedthecashcowsThreePathstoFailure(cont’d)HighLowHighLowMarketGrowthRateRelativeMarketSharePIMS(ProfitImpactofMarketingStrategy)ProgramDatabaseofnearly3,800SBUsRepresentingmorethan500firmsMemberfirmshavebeenintheprogramfrom2to12yearsTheprogramprovidesParROI(ReturnofInvestment)PredictionofhowROIwouldchangeifpolicychangeismadeImportantStrategicPrinciplesDerivedFromPIMSInthelongrun,productqualityisthesinglemostimportantfactoraffectingperformanceMarketshareandprofitabilitycloselycorrelatedHigh-investmentintensityreducesprofitabilityCashimplicationsofgrowthrateandrelativemarketshareareaffectedbymanyfactorsVerticalintegrationisprofitableforsomebusinessonlyMostfactorsthatboostROIalsocontributetovalueExlesofApplicationofsomeofthePrinciplesofPIMSinASPACPursueofproductqualityAustralianQualityCouncilHongKongAwardsforIndustry(Qualitycat.)JapanQualityAwardMalaysia’sPrimeMinister'sQualityAward(PrivateSector)PhilippinesQualityAwardSingaporeQualityAwardSriLanka’sNationalQualityAwardThailandQualityAwardExlesofApplicationofsomeofthePrinciplesofPIMSinASPAC(cont’d)PursueofmarketshareNovaGroupandEuropaHoldingsofSingaporeexpandingtheirpubsandrestaurantsbusiness(Source:TheStraitsTimes;Dec10,1992;pp.2)HighinvestmentreducesprofitabilityTheacquisitionofnewmachinerycausedareductioninSMSummitHoldingsgrossmarginSM(Source:SMSummitHolding’sAnnualReport2000)LimitationsofPIMSKeymarket-sharevariableissensitivetoproduct-marketdefinitionOthervariablesdependonsubjectivejudgementsInherentlimitationsofcross-sectionanalysisSlebiasedtowardlargerfirmsthatareindustryleadersGE(GeneralElectric)/McKinseyMulti-FactorMatrixOriginallydevelopedbyGE’splannersdrawingonMcKinsey’sapproachesMarketattractivenessisbasedonasmanyrelevantfactorsasareappropriateinagivencontextBusiness-positionassessmentalsomadeonamanyfactorsSBUneedstoberatedoneachfactorGEMultifactorPortfolioMatrixIndustryAttractivenessBusinessStrengthsHighHighMediumMediumLowLowInvest/GrowSelectivity/earningsHarves