1. FORMULATION OF STRATEGY: ANALYSING THE PRODUCT PORTFOLIO
THE BCG MATRIX
THE SHELL MATRIX
THE GENERAL ELECTRIC MATRIX

2. SOME DEFINITIONS
Business Portfolio: The collection of businesses and products that make up the company.
Portfolio analysis: A tool by which management
identifies and evaluates the various businesses that
make up the company
Strategic business unit (SBU): A unit of the company
that has a separate mission and objectives and that can
be planned independently from other company
businesses. A SBU can be a company division, a
product line within a division, or sometimes a single
product or brand.

3. BCG MATRIX : BCG CLASSIFICATION OF PRODUCTS
High 20
Dogs
Question marks
Stars 10
Market growth
Cash cows
Low 1x
10x
0.1x
Market share

4. PORTFOLIO ANALYSIS Stars Cash cows Question marks Dogs Low-growth
High-share businesses or products
Established and successful units that generate cash that the company uses
to pay its bills and support other business units that need investment
Question marks
Low-share business units in high-growth markets
Dogs
High –growth
High market share (High-share businesses)
Products often require heavy investment to finance their rapid growth

5. THE GENERAL ELECTRIC MATRIX BY MCKINSEY
Typical (external) factors that affect Market Attractiveness: - Market size - Market growth rate - Market profitability - Pricing trends - Competitive intensity / rivalry - Overall risk of returns in the industry- Entry barriers - Opportunity to differentiate products and services- Demand variability - Segmentation - Distribution structure- Technology development 
Typical (internal) factors that affect Competitive Strength of a Strategic Business Unit: - Strength of assets and competencies - Relative brand strength (marketing) - Market share- Market share growth - Customer loyalty - Relative cost position (cost structure compared with competitors)- Relative profit margins (compared to competitors) - Distribution strength and production capacity - Record of technological or other innovation- Quality - Access to financial and other investment resources- Management strength 

6. THE PRODUCT PORTFOLIO THE BCG MATRIX