A company that must succeed
should be able to manage its portfolio of products or strategic business units
in order to balance cash flows. Stars generate enough cash to sustain them
selves. Cash cows generate cash flows to be milked. Question marks suck up cash
from cash cows. Dogs are cash traps that should be dispensed with if they are
eating too much and contributing nothing.
should be able to manage its portfolio of products or strategic business units
in order to balance cash flows. Stars generate enough cash to sustain them
selves. Cash cows generate cash flows to be milked. Question marks suck up cash
from cash cows. Dogs are cash traps that should be dispensed with if they are
eating too much and contributing nothing.
In all of this, the field
theory should be applied. The field theory has it that, a company might decide
on its economies of scope. It must decide on what product line area it wants to
compete in and what skills will be needed to successfully compete in that area.
Four variables are to be considered, they are:
theory should be applied. The field theory has it that, a company might decide
on its economies of scope. It must decide on what product line area it wants to
compete in and what skills will be needed to successfully compete in that area.
Four variables are to be considered, they are:
1. products to be offered
2. the markets to be serve
3. the customer to satisfy,
and
and
4. The value to be added.
