Week 6: Heartland Matrix

Question 1

Heartland Matrix use

Answer 1

evaluates portfolio for companies business units by assessing how much each business unit fits “parenting advantages” of corporate headquarters.

Not only financial view as Grow-share matrix. Looks at how business can add value to corporation and how corporations add value to the business. Destroyed or added value.

Core idea- PARENTING ADVANTAGE

Question 2

Vertical added value

Answer 2

Parent advantage
Does this business benefit from being held by a parent?

Question 2

Horizontal added value

Answer 2

Sibling advantage
Does the business unit add value to the parent company?

Question 3

What is the core condition for parenting advantage to work?

Answer 3

For parenting advantage to work and for various business units to be profitable:
diversification must be related!!!
If businesses are too different it is difficult to find core competence that can be shared!

Question 4

Define axis and components of Heartland matrix.

Answer 4

see summary or video