Dansk
The Boston model or as some call it the Boston Matrix was developed by Boston Consulting Group in the early 1970s. The model aims to provide an overview of how the company's resource is best spent on the different products to achieve the highest earnings.
You work from 2 axes. A Y axis which is about market growth as a percentage and an X axis which is about the relative market share measured in relation to the main competitor. This way you get 4 outcomes.
Outcome questioned: Here, ideas for new products/business areas are typically noted, which are potential in a high-growth market, but where the product is still not known.
Outcome star: Here, products with which the company is very successful are noted. Here is high growth and high relative market share. It is often these products that the company creates its brand on.
Outcome dairy cow: Star products, after some time, often go down into outages, where market growth has slowed/saturated but the company so far has its good market share. These product groups will typically be phased out at a later date if they are not kept up to date and relevant at all times.
Outcome dog: Here, products with low relative market share and low market growth are noted. In other words, the product has become unattractive or is close to it. Sometimes these products are kept alive for the sake of owner and manager (see questions and answers about owner and manager's preferences), other times they develop and become new stars or they are deleted.
The Boston model must not only be designed so that you can then tick the check mark by now it is completed. Together with your other strategy material, it must be translated into concrete actions . An easy and simple approach is to use MakeMyStrategy™ as structures and summarize all your work into one comprehensive and coordinated action plan.
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Elizabeth Bagger
Non Executive Director
AVS Denmark