Two large multispecialty medical groups have recently asked

Solution

Problem child:

Earning- Such company have low earning, Unstable market and are in Growing phase

Cash Flow- Such company experience negative cash flow

Strategy- Such Company analyzes to determine weather the business can be grown into a star or will degrade into a dog.

Star:

Earning-Such companies are highly stable and are in growing phase

Cash Flow- Such company experience neutral cash flow

Strategy- Such Company adopts investment proposals to review its growth.

Dog:

Earning-Such companies have low earning and are unstable.

Cash Flow- Such company experience neutral or negative cash flow

Strategy- Such Company divest because of unprofitable.

Cow:

Earning-Such companies are highly stable and have high market share.

Cash Flow- Such company experience highly stable cash flow.

Strategy- Such Company adopts investment proposals to grow and milk the profit.

In first group

Cash cows-65%

stars-10%

problem children- 20%

dogs-5%.

Data revels that such company falls under the cash cow where the company enjoys highly stable earning and have stable cash flow .Therefore the company should think about investment proposal to milk the profit from its high market share ratio.

In the second group,

Cash cows- 20%

stars-60%

problem children-15%

dogs-5%

Data revels that company is in star position therefore have highly stable earning and in growth phase. Such company enjoy high market share and high market growth rate. They should invest for the future growth