Page 22 - PowerPoint Presentation

STRATEGY AND GOVERNANCE

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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