The x-axis generally denotes the market growth rate, or cash usage - with the y-axis denoting relative market share, or cash generation.īruce Henderson reasoned that established and mature areas of a business where required to generate significant income (cash cows) which could then be invested into new highly profitable market leading products (stars). The matrix is scored from low to high on both the x-axis and y-axis. The quadrants are split into combinations of "market growth" and "market share", hence also being known as the growth-share matrix or growth-market-share matrix. The concept is based on four quadrants in which a company's strategic business units (SBU) or products/brands are classified. Devised as a portfolio planning tool, or corporate planning tool, the BCG growth-share matrix was first conceived by Bruce Henderson of the Boston Consulting Group back in the 1970's.
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