Strategic Marketing: Planning and Control, Third Edition

(Wang) #1

■ Auditing tools


There is a range of tools that can be applied during the auditing process
that are capable of providing useful insights into the companies situation.


● Value chain
The value chain is an obvious analytical tool to use in the internal audit.
This tool specifically looks at the primary and support activities of an
organisation and therefore directly relates to identifying organisational
capabilities. A full explanation of this tool is undertaken in Chapter 8.


● Portfolio analysis
There are a number of portfolio models that are used to identify the
current position of business units or products. This position will be the
result of the organisation’s current resources and can be seen as a
symptom of the competencies and assets of the organisation. They
reflect the organisation’s current performance and identify strengths
on which the marketing strategy can be built, or weaknesses that the
strategy is required to overcome.


● The Boston Consultancy Group (BCG) growth share matrix
This is one of the most well known portfolio models. The growth share
matrix is concerned about the generation and use of cash within a busi-
ness and can be used to analyse either SBU’s or products. The two axes
on the model represent relative market share and market growth (see
Figure 5.7). Relative market share is seen as a predictor of the product’s


Internal analysis 101

Star

Cash generated
Cash use

+ + +
_ _ _

_ _

_ _ _
_ _
_____
0

Question mark

Cash generated
Cash use

+

_____

Cash cow

Cash generated
Cash use

+ + +

______
+ +

Dog
Cash generated

Cash use

+

_____
0
10X 1X 0.1X

Market growth (annual rate in constant £ relative to GNP growth)

High

Low

High Low
Relative market share (ratio of company share to share of
largest competitor)
Figure 5.7
The BCG’s growth
share matrix
Free download pdf