Boston matricen er en god hjælp til at vurdere produktporteføljen. Den er også et typisk eksempel på håndtering af kompleksitet ved at påtrykke området en meget simpel struktur. Man ser specielt mange af disse 2×2 matricer, og vi her selv fundet på nogle stykker til hjælp i situationer hvor vi savner overblik eller hvor vi ønsker at illustrere nogle sammenhænge.

Man vælger to væsentlige og af hinanden uafhængige forhold og afbilder dem ud af akserne. Derefter deler man koordinatsystemet op (enten i 4 kvadranter eller med en kurve) og betragter de opståede felter hver for sig. I realiteten er det jo blot en nem måde at definere 4 kategorier, men det er forbløffende så meget man kan få ud af det.

I tilfældet med Boston matrices har man valgt parametrene markedsandel og markedsvækst. For at kunne gennemføre diskussionen om strategierne for de enkelte områder, er der i realiteten indført en ekstra dimension, nemlig vigtigheden for virksomheden (nuværende omsætning), ved at plotte produkter/enheder ind som boller af forskellig størrelse.

Markedsandel og markedsvækst er valgt ud fra følgende antagelser:

Et marked i vækst er en god ting. En typisk livscyklus er: Vækst, modning, tilbagegang. Her vil vækstfasen ofte byde på mest fordelagtige muligheder. En relativ høj markedsandel stort nuværende volumen er ligeledes gode ting, idet stordriftsfordele og større erfaring ofte betyder en stærkere position på omkostningssiden. Forslag til hvordan man skal håndtere de fire kategorier (kvadranter) er beskrevet nedenfor.

Modellen fokuserer på potentiel indtjening (pengestrøm) og på kapital som knap faktor (man behøver cash cows for at financiere væksten af starts og evt. question marks). Den siger ikke noget om hvordan man forsvarer markedsandelen eller skaber væksten. Det gør derimod Michael Porter. Man kan måske sige at de to modeller supplerer hinanden idet Boston modellen siger noget om hvor virksomheden står i forhold med hele sin protefølje i forhold til til markedet, medens Michael Porter siger noget om hvordan man lægger strategien for det enkelte produkt/forretningsområde.

Hvis en virksomheds indtjening er utilfredsstillende, vil ledelsen være fristet til at se på aktiviteterne og droppe dem med lille eller negativt DB, men fastholde dem med bedre DB. Hvis modellen så viser at det der bliver tilbage er lutter cash cows, vil de fleste kunne forstå at virksomheden får et alvorligt problem på længere sigt.

Et par afledede one liners:

Man skal ikke holde udsalg før de nye varer er bestilt hjem. Man skal ikke sælge ud af cash cows før lige inden lukketid.

Developing market share strategies for a portfolio of products based on their cash-flow characteristics. Representing a firm's product portfolio so as to highlight its strengths and weaknesses. Deciding whether to continue investing in unprofitable products. Allocating a marketing budget among products so as to maximize long-term cash flow from them. Measuring management performance based on the performance of a manager's products in the marketplace.

Identify the unit of analysis, being careful to define the market realistically. Can be used for products, business units, or other units of analysis. Gather statistics on annual sales, competitors' annual sales, and market-growth rate for each product or business unit to be analyzed. Calculate relative market share (the revenues of a unit divided by the revenues of its largest competitor). Plot the products/business units on a graph using relative share and market-growth rate. Divide the graph into quadrants to create the growth/share matrix. Evaluate the portfolio based on BCG's assumptions concerning cash flow within the matrix and performance of products/units in each quadrant.

The Boston Consulting Group developed its famous Growth/Share Matrix to help diversified companies maximize portfolio performance by identifying which products to invest in, which to milk for investment funds, and which to eliminate from the portfolio. Although most managers are aware of the BCG matrix, few are familiar with the logic behind it or realize that it is still a useful tool for strategic planning and product management.

The matrix assumes that cash-flow potential of a product is related to the overall growth rate of its market, to its share of the market relative to competing products, and to its current size. Since these are generalized measures, they allow comparison of widely differing products and markets.

The experience curve (in which costs go down with number of units produced) justifies the assumption that high market share relative to competitors is advantageous. The product life-cycle model (in which a product moves from introduction through growth, maturity, and decline stages) justifies the assumption that high growth is desirable. Other arguments also favor high share (economies of scale, tactical strength of leadership position) and high market growth (higher sales growth and higher profits). These arguments lead to the cash-flow predictions in Exhibit 1. The Growth/Share Matrix depends on these cash-flow assumptions.

1. Identify the unit of analysis. Usually the method is applied to individual products, and they are looked at in the context of their entire markets.

But sometimes a product category is subdivided (example: models). Markets may also be subdivided (Examples: geographic areas, segments).

From „The Experience Curve-Reviewed,“ Perspectives, Number 135, © 1973, The Boston Consulting Group, Boston, Massachusetts.

The matrix has also been used to analyze strategic business units, divisions, entire companies, and even countries. As long as the cash-flow assumptions of the model appear valid, the matrix may be used for whatever unit of analysis is important in decision making.

Note: The Norton Company uses a hierarchical approach in which matrices are first prepared for strategic business units, then product lines, and finally for individual products. By starting with a large unit of analysis, Norton is able to take a broad strategic view of its portfolio supplemented by in-depth analysis of areas in need of attention. (See Abell and Hammond, p. 141.)

2. Gather the necessary statistics on the products to be analyzed:

Annual sales for each of your company's products (in dollars or units, most recent period). Annual sales of the largest competitor to each of your products (same unit and period). Annual growth rate in each of the products markets (percent growth in total market revenues or unit sales over most recent period).

3. Calculate relative market share by dividing most recent annual sales of each product by the annual sales of its largest competitor.

Relative share is 1, where your company's product has as large a share of its market as its main competitor. If your product has a smaller share than its largest competitor its relative share is less than 1. If it is larger than the next largest competitor its relative share is more than 1.

Note: You do not need to know market share to calculate relative share. Nor do you need data on all competitors except the largest, even if there are many competitors with a larger share than your product.

4. Plot each product on a graph with market growth rate on the vertical and relative market share on the horizontal.

A log scale is usually used for relative share, and relative share increases to the left, not the right. The graph is customarily divided into quadrants by a vertical line at relative share equals 1.0 and a horizontal line at market growth equals 10%. (Alternatives: Divide the growth axis at the industry average growth rate, a weighted average of the growth rate; of all products in the portfolio, or a corporate hurdle rate.)

Draw a circle around each product's plot with diameter proportionate to the product's recent annual revenues. (Some users make the area of the circle relative to revenues-a more accurate but complex approach.) Hint: Plot sales on a bar chart that is half as long as your growth/share matrice's horizontal axis. Trace the bars to obtain appropriate circle diameters.

5. Evaluate the product portfolio based on the quadrant each product falls into. Products are categorized according to the quadrant where they appear in the matrix. High growth, high relative-share products are stars. Low growth, high relative-share products are cash cows. Low growth, low share products are dogs, and high growth but low share makes a product a „troubled child“ or question mark.

The cash-flow assumptions of the model lead to the following conclusions about each of the quadrants:

Managers usually cannot control market growth but can invest to maintain, lose, or build market share. Market share strategies for each product should reflect the need for future cash cows. Question marks can be transformed into stars by investing in share growth, then allowed to mature into cash cows through a share-maintenance strategy. Unprofitable dogs can be dropped to divert funds to question marks or stars, and efforts can be concentrated on the most promising question marks. (Share strategies should produce a cash flow from the lower left to the upper right of the matrix.)

6. Follow the movement of products over time. A time series makes it possible to identify the direction of each product's movement within the growth/share matrix. Prepare several matrices on the same scale, one for each of the last two or three years, and superimpose them. Trace them onto a single matrix or use directional arrows to indicate movement on a copy of the most recent year's matrix.

Idea: According to Bruce Henderson, founder of BCG, matrices „may be even more useful to evaluate management performance.“ The manager of a product or a portfolio of products can be evaluated based on how products move within the matrix over time.

Any product that does not move rapidly toward 100 percent of the relevant market share is presumably mismanaged.