Strategy formulation

Strategy formulation turns analysis into choices: which strategies to pursue at corporate level (growth, stability, retrenchment, integration, diversification) and how to compete at business level, then which portfolio of businesses to hold. The classic portfolio tools are the BCG growth-share matrix, the GE business screen and Ansoff's product-market matrix. Worked example: a firm with a high-share, low-growth product (a cash cow) should milk its cash to fund a low-share, high-growth product (a question mark) that could become tomorrow's star — the portfolio logic is funding tomorrow's winners with today's earners, not treating every business the same.