12.4 Strategic Management

Question 1

According to Boston Consulting Group’s portfolio model for competitive analysis, the strategy for a strong cash cow should be

Answer 1

Hold

A hold strategy is used for strong cash cows. It is necessary if the business is to continue to generate large net cash inflows. Harvesting might impair a strong cash cow’s ability to generate long-term positive net cash inflows.

Question 2

In the Boston Consulting Group (BCG) growth-share matrix, which strategic business units are strong competitors in high growth markets but usually have modest net cash flow?

Answer 2

Stars

Question 3

A strong competitor in a high growth industry

Answer 3

Star

Question 4

The most favorable condition for the attractiveness of an industry is

Answer 4

the existence of high entry barriers and low exit barriers.

Question 5

According to the growth-share matrix approach developed by the Boston Consulting Group, a harvest strategy is most likely to be used for SBUs that are

Answer 5

Weak cash cows and possibly question marks and dogs

Question 6

A typical life cycle progression for a successful firm within the Boston Consulting Group’s growth-share matrix is

Answer 6

Question mark, star, cash cow, dog