- 20 Marks
Question
a) The company has presented information on the various products and services (i.e. the strategic business units (SBUs)) within the company’s portfolio.
Required:
Using Ashridge Portfolio Display Matrix and based on the performance of each SBU, clearly classify and explain the products and services under appropriate categories identified by the matrix. Support your answer with Ashridge Portfolio Display Matrix.
b) Since its inception, BOGML has grown organically and has gone through different stages of development in response to the challenges of growth and changes in both its internal and external environments. The company is currently under pressure to continue evolving.
Required:
i) Identify and describe the first two phases of growth applicable to BOGML based on Greiner’s Growth Model. In your explanation, include the type of crisis the company faced at each phase.
ii) The board has proposed appointing Regional Managers who will be responsible for the sales performance of the company’s filling and gas stations in their regions. If this proposal is implemented, it will move the company to the next phase in Greiner’s Growth Model. Identify and explain what this next phase is, and describe the potential crisis that may arise at this stage.
Answer
b) Greiner’s Growth Model Application:
i) First Two Phases:
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Creativity Phase
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BOGML began with no formal structure; roles were undefined, and leadership was centralised with the MD.
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Crisis: Leadership Crisis – the informal system couldn’t keep up with the growing organisation.
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Direction Phase
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MD appointed Heads of Departments, bringing role clarity and centralised decision-making.
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Crisis: Autonomy Crisis – department heads lacked decision-making freedom, leading to inefficiencies.
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ii) Next Phase – Delegation Phase:
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Appointing Regional Managers marks the transition to delegation, giving more autonomy to regional units.
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Crisis: Control Crisis – decentralisation may reduce oversight and create inconsistencies without strong coordination systems.
a) Using the Ashridge Portfolio Display Matrix:
SBU Fit with Parent Potential to Add Value Category Explanation Gasoline & Gas Oil High Low Heartland Businesses These operate optimally and are the main products of BOGML. Parent has little to add. LPG & Kerosene High High Value Trap Businesses Lack competencies for success but parent (BOGML) has required skills and experience to support. Mini-marts & Washing Bays Low Low Alien Businesses Operate outside petroleum industry; BOGML lacks expertise and cannot add value. Commercial Transport Low Low Alien Businesses Outside petroleum industry; business already successful; no value to be added by parent. Real Estate Construction High High Value Trap Businesses Parent has skills/resources; business currently faces challenges and low profitability.
- Topic: Methods of Development, Strategy implementation
- Series: Nov 2024
- Uploader: Salamat Hamid