The Product Portfolio Matrix approach propounded by the Boston Consulting Group also known as BCG (Boston Consulting Group) matrix or Matrix Quadrants.

Using the Product Portfolio Matrix approach, a company classified all its SBUs or Product/Market according to Growth-Share Matrix.

In this Matrix Quadrants, the plate is divided 4 categories named Star, Cash Cow, Question Mark and Dog regarding its Market Share and Growth rate. A brief discussion comes follow:

Star: Leader of high growth market is called star. They are net user of cash, because they always require heavy investment to finance rapid growth and to sustain market share. When the product comes to mature stage, then the growth slow down and they turn to cash cow.

Cash Cow: Cash cows are low growth but high market share (Market leader) businesses or products. Their high earnings, coupled with their depreciation, represent high cash inflows and they need very little in the way of reinvestment. And thus, they are the net provider of cash. Surplus cash are used for R&D and to support other SBUs that need investment.

Question mark: Products in a growth market with low market share are categorized as Question Mark. Because of growth, these SBUs require a lot of cash to hold their market share and let alone to increase it. If nothing is done to increase the market share, a Question mark will simply absorb large amount of cash in the short run and later, as growth slow down, become a dog. Thus, unless something is done to change its perspective, it becomes a cash trap.

Management has to decide which question marks should try to build into stars and which should be phased out.

Dog: Dog are low growths, low market share SBUs. They may generate enough cash to maintain themselves, but do not promise to be large source of cash.