BCG Matrix of LG
BCG Matrix of LG
BCG Matrix of LG
OF
STRATEGIC
MANAGEMENGT
Submitted to:
(Session 2009-2011)
Reg. No.10904478
Contents
TERM PAPER................................................................................................................ 1
OF............................................................................................................................... 1
STRATEGIC.................................................................................................................. 1
MANAGEMENGT.........................................................................................................1
Contents..................................................................................................................... 2
ACKNOWLEDGEMENT..................................................................................................3
REVIEW OF LITERATURE..............................................................................................4
COMPANY: LG.............................................................................................................. 5
QUALITY INNOVATION.................................................................................................9
PRODUCT OF LG........................................................................................................12
BCG MATRIX.............................................................................................................. 13
CONCLUSION...........................................................................................................20
BIBLIOGRAPHY.......................................................................................................... 22
ACKNOWLEDGEMENT
the theoretical concepts and definitely the things which I have learned
on in our economy.
I would also like to thank all those people who directly or indirectly
Kim. R, “Setting cost targets”(2008),With LG's cell phones, cost targets are set by the LG's
mobile communication business procurement team after meeting with the product planning
division and with R&D. There are target costs for the baseband processors, memory chips and
other semiconductors in the phone. "We want to meet the targets or do better than the target
costs," says Tae Woo Kim, vice president, development procurement team for mobile
communication. "At the end of the day we want to reduce cost," he says. Kim says much of what
procurement engineers do in new product development with mobile phones concerns
semiconductors. That's because 80–85% of LG's spend in the mobile communications business is
for semiconductors. LG makes a variety of smart phones and other cell phones such as the
Chocolate, Incite and Shine.
History of company
The company was originally established in 1958 as Gold Star, producing radios, TVs,
refrigerators, washing machines, and air conditioners.
The LG Group was a merger of two Korean companies, Lucky and Gold Star, from which the
abbreviation of LG was derived. The current "Life's good" slogan is a acronym. Before the
corporate Name change to LG, household products were sold under the Brand name of Lucky,
while electronic products were sold under the brand name of Gold Star. The Gold Star brand is
still perceived as a discount brand.
In 1995, Gold Star was renamed LG Electronics, and acquired Zenith Electronics of the United
States.
Global Operation
LG Electronics is playing an active role in the world market with its assertive global business
policy. As a result, LG Electronics controls 110 local subsidiaries in the world with around
82,000 executive and employees.
LG Group
1. LG.Philips LCD
2. LG Chemical
3. LG Telecom
4. LG Powercom
5. LG Twins
6. LG Dacom
Business areas and main products
Mobile communications
(a) CDMA Handsets,
(b) GSM Handsets,
(c) 3G Handsets,
(d) Cellular Phones
Digital appliance
a) Air Conditioners,
b) Refrigerators,
c) Microwave Ovens,
d) Washing Machines,
e) Vacuum Cleaners,
f) Home Net,
g) Compressors for Air Conditioners and Refrigerators
Digital display
a) Plasma TVs,
b) LCD TVs,
c) Micro Display Panel TVs,
d) Monitors,
e) PDP Modules,
f) OLED Panels,
g) USB Memory,
h) Flat Panel Computer Monitors
Digital media
a) Home Theater Systems,
b) DVD Recorders,
c) Super Multi DVD Rewriters,
d) CD±RW,
e) Notebook PCs,
f) Desktop PCs,
g) PDAs,
h) PDA Phones,
i) MP3 Players,
j) New Karaoke Systems,
k) Car Infotainment
LG BRAND IDENTITY:-
The brand of LG is delightfully smart. LG strives to enhance the customer’s life and lifestyle
with intelligent features, institutive functionality and exceptional performance.
o Value
o Promise
o Benefits
o Personality
Trust,
Innovation,
People
Passion
• Trustworthy,
• Considerate
• Practical,
• Friendly
Learning Culture
Boundary less Environment
A Carrier
Growth
According to LG, the Learning Culture continuously helps the employee to learn more and
more to develop the habit of continuous learning.
Boundary less Environment means that there is no difference between the levels of employees.
There is transparency between the work and mutual understanding between all the employees.
A carrier is highly growing in LG and one who is the employee can develop their carrier largely.
A new comer will feel fully comfortable in the company and for a new comer the company is
very helpful in the overall growth of personality.
Growth in LG is very high for those who are in the company and for those who want to join in
LG. The company is growing with fast innovation and the BLUE Ocean strategy is one of the
examples of growth.
Product Leadership
1. New Machine
2. Reliability
3. Conventional Installation
4. Environment Friendly Product
5. Low Noise & Vibration
6. Energy Saving
QUALITY INNOVATION
The policy of quality assurance is to provide customers with utmost satisfaction by supplying
zero defects.
c) Equal opportunities
d) Equal Treatment
Management Principle - Creating value for customer
• VISION
LG’s vision is to deliver innovative digital products and services that make our customers’ lives
better and easier—happier, even—through increased functionality and fun.
• GOAL
Mobile Phone Premium trend setter phone , Camera Phone , Music Phone ,
Color Screen GSM Handset
BCG MATRIX
In BCG Matrix product or business unit are identified as Stars, Cash Cow, Dogs, Question mark.
BCG Matrix can use for resource allocation. The Matrix can be explained are as follows:
o Stars are using large amounts of cash. Stars are leaders in the business. Therefore
they should also generate large amounts of cash.
o Stars are frequently roughly in balance on net cash flow. However if needed any
attempt should be made to hold your market share in Stars, because the rewards
will be Cash Cows if market share is kept.
o Question Marks have the worst cash characteristics of all, because they have
high cash demands and generate low returns, because of their low market share.
o If the market share remains unchanged, Question Marks will simply absorb
great amounts of cash.
o Either invests heavily, or sells off, or invests nothing and generates any cash that
you can. Increase market share or deliver cash.
BCG MATRIX OF LG COMPANY IN
COMPARISON TO OTHER
ELECTRONIC COMPANIES
BCG MATRIX OF LG COMPANY
ACCORDING TO ITS PRODUCTS
• BCG Matrix
STARS QUESTION MARKS
(Appliances) (LCD)
STRENGTH
⇒ Wide range of product categories to tap the consumer of middle class, upper middle class
and high class.
⇒ LG having the widest distribution network in the industry (47 branches,175 area offices
and over 10,000 trade partners).
WEAKNESS
⇒ Consumer compares LG products only with Samsung and not with any other brand.
OPPORTUNITIES
o Shifting to rural market
o Control over the white goods market, as we know the highest market share in home
appliance market.
THREAT
o The closet competitor of LG ,Samsung is also from South Korea and consumers
LG product with Samsung products
CONCLUSION
LG is an industrial conglomerate with interests all over the world and based in India. The group
has 17 manufacturing sites in India and plants in China, Poland, Italy and Mexico. It is also the
third largest picture tube manufacturer in the world.
• Consumer electronics
• Mobile Phones
• Telecommunication
In BCG Matrix product or business unit are identified as Stars, Cash Cow, Dogs, Question mark.
BCG Matrix can use for resource allocation.
LG mobile is increasing its market share but that is only due to the sale of low end products. At
this point market is flooded with counterfeiting phones coming from china. So they must
explore new market or re visit their strategy in their existing markets. It is about time LG focus
on its advertising strategy for high end products and has more sophisticated approach. This
would improve the brand image of LG mobile in the market. If LG is able to change the
perception of the consumers about the brand it will for sure see a growth that is sustainable in
the long run as well.
BIBLIOGRAPHY
• http://www.lg.com/in/index.jsp
• http://www.faqs.org/abstracts/Business-international/LG-HITS-THE-HINTERLAND-
THE-PICTURE-GETS-SHARPER-AT-PHILIPS.html#ixzz0mh9ItA5G
• http://www.faqs.org/abstracts/Business-international/LG-TO-EXTEND-REACH-IN-
WEST-ASIA-RIDING-ON-SALES-LG-H1-NET-UP-AT-Rs6897-
CRORE.html#ixzz0mhGjUyOC
• http://www.articlealley.com/article_1199524_45.html
• http://www.bpotiger.com/2007/11/shahrukh_khan_and_ms_dhoni_tog_1.html
• www.highbeam.com/doc/1G1-149628585.html
• www.liebertonline.com/doi/abs/10.1089/153056201750279584
• www.article.wn.com/...LG_launches_nine_mobile_handsets_eyes_1_mn_sale_monthl