Feb 14, 2020 in Business Coaching

PRIORITIZATION MATRIX FOR COMPETITIVE ADVANTAGE

Here’s a framework for analyzing various initiatives/ business segments.

BJ Jhaveri

Business coach

150 $ / session

Article cover

Here’s a framework for analyzing various initiatives/ business segments. It’s in the form of quadrants (boxes) with its axes as ‘cash flow’ and ‘differentiation’. It is useful for selecting initiatives to actively focus and allocate your resources in order to maximize profits and get the highest value returns. It may also help you analyze your revenue stream and redefine offerings in the market.

Quadrant 1: Low Cash-flow & Low Differentiation

These are commoditized areas where your market presence is weak due to a lack of differentiation. These initiatives generate barely enough profit to maintain the sustainability of the unit. Furthermore, they depress the company's profitability over a period of time.

Did you know that you can also talk with the author of this article?

BJ Jhaveri

Business coach

150 $ / session

Recommended Actions:

· Dilute your focus

· Avoid any capital investments

 

Quadrant 2: High Cash-flow & Low Differentiation

These units generate quick & surplus cash in comparison to the amount needed to maintain them. If competition is high and there are few opportunities for differentiation; then it may be less attractive for further investment. These units are regarded as dull and boring in a mature market.

Recommended Actions:

· Harvest the cash-flow & maximize profits

· Invest resources only if it gets immediate ROI

· Increase market share by volume discounting

 

Quadrant 3: Low Cash-flow & High Differentiation

These units are niche and/or fragmented segments with the potential to grow. They could generate higher revenue and improve the company’s competitive advantage. You need to work incrementally to gain market share. If you do not succeed then the unit might consume a lot of cash and hinder your profitability, and drain your resources.

Recommended Actions:

· Expend efforts wisely and in a discretionary manner

· Use innovation to differentiate from the competition

 

Quadrant 4: High Cash-flow & High Differentiation

These are areas where you are well-established and you have a good reputation with clients. It’s a growing market with many opportunities and scope for building your own market share.

Recommended Actions:

· Focus actively on this business

· Grow market share by engaging your best resources

· Make continued investments

Related articles

Article cover
Be the boss you have ever wanted to have

In your own business you cannot be a producer or a doer, since what your business demands the most is a leader and a manager

Marcell Kovacs  | 27 June, 2019

Article cover
Women and Shattering the Glass Ceiling

Women keep themselves weak and unable to change their fate if they do not accept that failure is natural.

Peter Koczian  | 15 October, 2019

Article cover
Which Success Archetype Are You?

Learn which archetype you are and it's impact on your success. And the strategies to empower your archetype

Mandie Holgate  | 24 September, 2019

Article cover
Who I am?

You can know me be better after reading it.

Peter Koczian  | 27 August, 2019