Bcg of Gp

I. Company’s BCG analysis.

BCG Matrix also known as Growth-Share Matrix is strategic tool for portfolio planning and analysis. BCG Matrix is used for current portfolio analysis, portfolio planning and development, and new strategy development (“BCG Matrix” 2007).

As we can see there are four quadrants: dog, problem child, star and cash cow.

In which of the positions of the above picture does British Airways fit? Currently, British Airways is one of the leading airlines in the market. Along with Lufthansa they dominate the market within Europe, but also from Europe to Middle East and North America (Golden 2007). Their overall market share has increased by 4% in last year only (Press Release 2008). British Airways has relied much upon the brand name build during the past decades of the last century. It offers two major services: passenger flights and cargo flights. Within the passenger flights, it is well known for its business service but it also has an economic service (“Business Review” 2008). According to the “2008 Press Release” statement of Barclaycard Business mentioned above, British Airways has a good position in an industry that is facing ever rising difficulties because of the oil prices and the financial crisis.

But despite worldwide financial problems, the British Airways position is that of a “cash cow” in business travel service for passengers. The market growth is slow and in fact is halting, but they got a very suitable position. Their revenue from passenger flights in total were 7,541£ million in the 2007/08 fiscal year compared to 7,263£ million the year before, and from those more than two thirds were from business service flights (“Income Statement” 2008). From the same source it can be noted that British Airways generated 694£ million of after tax profit for the 2007/08 fiscal year, a more than 10% increase than the previous one. And most of this profit came from the type of service described here (“Income Statement” 2008). Now let...