Unilever Parenting& Diversification Trough Forward Integration in the Car Industry

Topics: Strategic management, Product management, Marketing Pages: 14 (3574 words) Published: January 23, 2010
Unilever parenting& Diversification trough forward integration in the car industry Strategy in Work

Egon Christopher Westerhausen
Summer 2009
Growth share matrix3

Building the growth Share Matrix from the Parenting Matrix given in the case study. Question 15


Unilever Question(ii)6

Positive and negative bias of a merger.7

Question (i)Determine other areas of forward integration that car manufactures might consider and explain why?8

Strategy that may be used by companies to create forward integration in the car industry.10

Question (ii) Analyze how the resources and competences of a car manufacture differ from the downstream activities they are moving into?11

Question (iii) Evaluate whether `diversification downstream´is related or unrelated or unrelated diversification, bearing in ming the answers to the question above.12

What is needed for a successful strategy?13
Growth share matrix

The growth share matrix was developed by a consulting company in Boston called ´Boston Consulting Group´, his creator is Bruce Henderson. By these means corporations are enhanced in the analysis of their product lines or business units. Usually this analytical tool is used in diverse areas as brand marketing , strategic management, portfolio analysis and product management.

There are two factors that define the matrix: There is a relative market share and of course market growth. Using this matrix by placing individual products from the company portfolio in one of the quadrants and repeating the process for competing products. As a result this will have direct implications in market share and brand positioning.

Four Quadrants

1- Stars: A product that has a high growth market and has a good slice of the market share. Usually a generating strong revenues. As a star product evolves and growth slows down it may become a cash cow if it holds market share or become dogs if not.

2- Cash Cows: This product has a big market share but its market growth is slow. Cash cows have a great return specially when companies invest more in them. This type of product tends to cover a companies overhead.

3- Dogs: This porducts have a low market share in a slow growth market. They usually report profit even as they are cash consumers.

4- Question Marks: This product has a low market share of a high growth market. This type of product needs big amount of cash due to their growth but at the same time generate small amount of return due to a small market share. For a question mark to become a star is complicated because of the amount of cash needed to acquire market share. At the end they may end up becoming a great business but companies usually fail to develop a leading position in the market, before risking becoming dogs.

The basis of the usage of this tool is to clarify situations to balance the product portfolio of a company. In an ideal situation to eliminate dogs, while holding others in a dynamic equilibrium. Usually a Chairman chief of staff would use the money created by a cash cow and invest in turning question marks into stars, and in their evolution become cash cows. But in reality some of the question marks will end up as dogs.

Building the growth Share Matrix from the Parenting Matrix given in the case study. Question 1

Question (i) Present these Strategic Business Units (SBUs) in parenting matrix in a Growth / Share matrix and identify clearly how the results of this parenting matrix exercise might differ from a portfolio exercise.


|High |LOW | |HIGH |Speciality Products |Detergents | |LOW |Food |Tea | |


*Speciality products: `star´, This product has a high growth assured and at the same time have a high market share. ( This product is in maturity, best time).

*Food: `cash cow´, This segment may supply funds for a future growth. ( This product is in a state of maturity and it continue to be very rentable)....
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