Page 19 - 5.2 i. Manac Finance ITC Summarised Notes

STRATEGY AND GOVERNANCE

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Analytical tools for assessing the feasibility of

strategies

• Based on the above the following strategies are available when
assessing each business unit:

Invest/Grow

• A business unit will be in the “invest/grow” category if it is has a high
industry attractiveness and the business unit is likely to do better than
most of the other firms in the industry i.e. it is highly competitive. A
business unit in this category should be given as much money as it

needs.

Selectivity/Earnings

• Business units in this category come secondary to those in the
“invest/grow” category. So, the amount of money spent on business

units in the “invest/grow” category will determine how much money is
left over for business units in this category.

• When allocating money to a business unit in this category, it is
important to monitor earnings closely, because if the business unit
doesn’t improve then it may be better to invest money elsewhere.

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