bcg vs. talent 2010

1 Sharing Knowledge is the Power…

Boston Consulting Group Matrix (BCG)

VS. HR Talent (Based on an article discussing BCG vs. Business)


Introduction

BOSTON CONSULTING GROUP (BCG) MATRIX is developed by BRUCE HENDERSON of the BOSTON CONSULTING GROUP IN THE EARLY 1970’s.

According to this technique, businesses or products are classified as low or high performers depending upon their market growth rate and relative market share.

The attempt in this presentation is to use this techniques with the Human Resources, i.e. Employees as low or high performers in relation to business objectives achievement.


Definition – Employee Wise.

The Boston Matrix:– A means of analysing the employees portfolio and informing

decision making about possible talent strategies

– Developed by the Boston Consulting Group – a business strategy and marketing consultancy in 1968

– Links HR talent strategies and cash flow


Why BCG Matrix?

To assess :

Profiles of employees The cash demands of employees development The development cycles of employees Resource allocation and divestment decisions


BCG Matrix vs. Employee Performance

To make the link of the BCG Matrix and the Employee Performance we need to agree on the levels of employees performance and to touch base on the Business Objectives.


Employee Performance

While the list of Major Job Duties tells the employee what is to be done, performance standards provide the employee with specific performance expectations for each major duty. They are the observable behaviors and actions which explain how the job is to be done, plus the results that are expected for satisfactory job performance. They tell the employee what a good job looks like.

The most comment performance levels are :• Excellent

• Very Good

• Good

• Satisfactory

• Poor.


Business Objectives

A business objective is the map you will use to reach the goals you have for your organization. If you are creating a business or planning for your company's future, you will not garner much success without clearly defined business objectives. A business objective will create a union between the mission and the strategies of your organization (i.e. marketing, productivity, projected profits, results). If you and your employees do not know where the organization is headed---then everyone will just travel in different "failing" directions.


Employees Life Cycles and the Boston Matrix

• Employees Life Cycle – shows the stages that an employee go through from hiring to service end from work.

• Product Portfolio – the types of employees a company has in development or ready to work for jobs/tasks at any one time

• Managing employees portfolio is important for cash flow “development wise”


The BCG Matrix

The model can be used based on performance measurements/observation etc that a company’s Human Resources “employees” can be classified in to the four BCG Matrix categories:

Stars Question marks Cash cows Dogs


The BCG Matrix


Stars : Excellent Performance & High Value

• Star Employees are leaders in business.

• They also require heavy investment “development”, to maintain their excellent performance.

• This should lead to achieving business objectives.

• Continues development is needed otherwise the star will become a CASH COW.

• Implications:

– Huge potential

– May have been expensive to develop

– Worth spending money to promote

– Consider the extent of their employment life cycle in decision making


Cash Cows : Low Growth , High Value Added/ Delivery

• They are foundation of the company and often the stars of yesterday.

• They accomplish more work “to achieve objectives” than required.

• They do not require a lot of investment “development”.

• They are often located in a business that is mature, not growing or declining.

• Implications:– Cheap to promote– Generate large amount of cash – can be used for further R&D?– Costs of developing and promoting have largely gone– Need to monitor their performance – the long term?


Dogs : Low Growth, Low Value to business . • Dogs are the cash traps.

• Dogs do not have potential to bring in much valuable work.

• Trouble makers, “ a lot of nagging”

• Number of dogs in the company should be minimized.

• Business is situated at a declining stage.

• Implications:

– Are they worth persevering with?

– How much are they costing?

– Could they be revived in some way?

– How much would it cost to continue to support such employees?

– How much would it cost to remove “fire them”?


Question Marks - High Potential, Low Work/Delivery

• Most employees start of as question marks.

• They will absorb great amounts of cash “development”.

• Why question marks? : Question marks have potential to become stars and eventually cash

cows but can also become dogs. Investments should be high for employees in the area of “question

marks”.

• Implications:

– What are the chances of these employees securing a hold in achieving business objectives?

– How much will it cost to promote them to a stronger position?

– Does it worth it?


BCG Benefits to the business

• BCG MATRIX is simple and easy to understand.• It helps you to quickly and simply identify/screen the

“employees profiles ” open to you, and helps you think about how you can make the most of them.

• It is used to identify how corporate cash resources can best be used to maximize a company’s current and future high potential employees (performance wise “profitability”).

• Short list those “DOGS” that you may need/want to remove from the business “fire”


Hints

• Problems of getting accurate info/data on employees performance, i.e. where to rank them.

• High number of starts does not mean guaranteed profits all the time.

• Having some dogs can be challenging and profitable too.


Employee Life Cycles and the Boston Matrix

• The Stages of the Employee Life Cycle:– Development

– Introduction/Launch

– Growth

– Maturity

– Saturation

– Decline

– Withdrawal


Traditional Employee Life Cycles and the BCG.

Adding values/performance

Time

Development Introduction Growth Maturity Saturation Decline


Ideal Employee Life Cycles and BCG.

Adding value/performance

Time

Effects of ExtensionStrategiesEffects of ExtensionStrategies


Conclusion

Though BCG MATRIX has its limitations, it is one of the most FAMOUS AND SIMPLE portfolio planning matrix ,used by large companies having multi-products with hundred/thousands of diversified employees. BCG can be very useful tool if used carefully with accurate information and data.

Thank You…

bcg vs. talent 2010

Documents

employees portfolio

profiles of employees

employees profiles

types of employees

employee performance

business strategy

defined business objectives

employees life cycles