Growth share matrix

During Koch's recent podcast episodes with Tim Ferris, he frequently mentioned the term "star business," which intrigued me. While I'm uncertain about my path, I've become more intentional in focusing on activities that benefit me rather than operating on autopilot at work.

Koch isn't the only author to touch upon the growth-share matrix, but I'd like to document my understanding here. The matrix consists of two axes: the vertical axis represents annual growth, while the horizontal axis indicates a venture's position within its niche market. Divided into four quadrants:

• The top-left quadrant houses the 'stars'—ventures growing at least 10% annually, if not more, and leading in their respective niche markets.
• The upper-right quadrant is reserved for 'unknown ventures.' They experience significant growth but rank behind the stars in their market dominance.
• The lower quadrants are home to 'cash cows' and 'dogs.' While cash cows maintain a leadership position, their growth is modest. On the other hand, dogs neither dominate their markets nor grow significantly.

Richard employs this matrix to guide his investment strategies. However, I perceive its underlying message as a nuanced version of the broader 80/20 principle. I'm keen on applying this principle more universally in my endeavors.

Contrasted with the general 80/20 rule, the matrix provides a more detailed categorization framework. There have been other matrices, such as the urgent/important vs. non-urgent/non-important. I once displayed it in my Princeton office, though I rarely referred to it after its initial placement.