List the company's SBUs and classify them as either dogs, cash cows, stars or question marks. Dogs are units characterized by low growth and low market share. Cash cows are units that have low growth but a high market share. They yield most profits and form the foundation of the company. Stars are characterized by high growth and a high market share. Question marks are units that have a low market share in a market with high growth.
Draw the BCG matrix on a piece of paper or a chart. Draw a horizontal line to denote the x-axis. From the leftmost point on the line, draw a vertical line perpendicular to the horizontal one. The vertical line denotes the y-axis. Plot "Market growth rate" on the y-axis and "Relative market share" on the x-axis. The point where the x-axis and y-axis intersect is zero. The portion on the x-axis and y-axis close to zero represents low market share and low market growth rate respectively. The portion on the x-axis and y-axis that is farther from zero represents high market share and high market growth rate respectively. Split the graph into four equal quadrants that represent regions of low market share and low market growth, low market share and high market growth, high market share and low market growth, and high market share and high market growth.
Plot the company SBUs into the respective quadrants of the BCG matrix.