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The IUP Journal of Business Strategy
Growth-Share Matrix as a Tool for Portfolio Planning: Evidence from the Indian Telecommunication Services Industry
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Portfolio analysis is used for making future strategic investment decisions for diversified streams of business for a firm. This analysis will help the corporate firms to do effective resource allocation for securing future competitive positions. The sample units comprises 17 telecommunication firms which are providing either all or a combination of seven selected services for the purpose of study, namely, wireless GSM, wireless CDMA, wireline, internet inclusive of broadband services, wireless and wireline broadband services, Village Public Telephone (VPT) and Public Call Offices (PCO). The growth-share matrix proposed by the Boston Consulting Group (BCG) as a tool of portfolio planning has been developed for each of the selected services with the bubble size in the matrix reflecting the subscriber base in millions for the respective service line by March 2009. The wireless GSM and CDMA services are currently a question mark, wireline telecommunication services are located in the dog quadrant, the internet services and broadband services standalone are positioned in the question mark, the VPT Booth service is a question mark and the PCO segment is positioned in the dog quadrant for majority of the selected sample units. The results are used to suggest portfolio planning strategies for the sample units.

 
 
 

The major objectives of the strategic planning process are of constituting Strategic Business Units (SBUs) in accordance with the corporate mission, planning new businesses and assigning resources to these SBUs (Kotler, 1994). Effective planning would design a perfect balance between the resources and the strategic intent (vision, program, procedures) amidst the environmental uncertainty (Drucker, 1990). Any organization having a portfolio of products or brands requires strategic planning for prudent management of cash with the tradeoff between cash generation and cash usage (McDonald, 1989). The portfolio model is considered very useful for internal analysis and development of strategic marketing options with respect to resource allocation decisions (Aaker, 1998). Portfolio matrix can be initiated by using a pair of variables strategic to the organization and including more than one SBU in the same analysis. Business portfolios can be assessed at the level of markets, segments within markets and distribution outlets for insights into strategic planning (Dibb, 1995).

 
 
 

Business Strategy Journal, Post-Merger Corporate Performance, Mergers and Acquisitions Transactions, Egyptian Technology Sector, Economic Reforms, Egyptian Companies, Financial Accounting Standards Board, Conglomerate Acquisition, Data Envelopment Analysis, Construction Sectors, Data Analysis.