Framework

BCG growth–share matrix

The question it answers

Across a portfolio of businesses, which should receive investment, be held or be harvested?

Origin
Henderson, 1970
Diagram type
2×2 matrix
Level of analysis
Firm
Topics
Strategy & leadershipCorporate finance
Chess knight on a glass compass, icon for strategy and leadership

Diagram

BCG growth–share matrix

LowMarket growthHigh
Question marks

High growth, low share: needs cash; decide to invest or exit.

High risk
Stars

High growth, high share: both earns and consumes cash.

Medium risk
Dogs

Low growth, low share: consider divesting.

High risk
Cash cows

Low growth, high share: generates cash to fund elsewhere.

Low risk
LowRelative market shareHigh

Pitfalls

Pitfall

Forcing every business onto two axes. High share does not always mean high profit, and low growth does not always mean exit.

Sources

References

Listed A–Z by author surname, Harvard style. A source with a DOI links to https://doi.org/…; one without links to its page or says plainly that it has no DOI.

  1. Henderson, B.D. (1970) The product portfolio. BCG Perspectives (The Boston Consulting Group).No DOIbcg.comSource page