How do BCG matrix and the five forces model differ in the market and competitive considerations?

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BCG and Five Forces Models
Created by Boston Consulting Group, BCG matrix is an evaluation tool used in the determination of the business brand portfolio’s strategic position. Based on the relative share-competitive position and growth rate of a particular industry/industry attractiveness, the tool classifies the business portfolio into four distinct categories namely dogs, cash cows, stars and question mark (Jurevicius 1). Dogs represent a firm’s brand that operates in a slowly growing market and that as compared to the competitors has a low market share. Star represents the brand that is rapidly increasing in as much as it doesn’t generate much for the business due to t its small market share. Question marks represent the brand with neutral cash flow, strong relative market share and produce a significant amount of cash in the business. Cash cows, on the other hand, represent the most mature brand since it generates stable earnings for the company (Jurevicius 1).
Porter’s five forces, on the other hand, is a competition analysis tool used in the examination of the competitiveness of a business environment. The tool focuses on the analysis of the forces in an industry or a business environment that is likely to affect to affect the operation and profitability of a firm. These five forces include the threat of new entry, the threat of substitution, buyer power, supplier power and competitive rivalry (Dälken 2).
From the above explanations, it is apparent that the two market analysis tools are both used in the competition analysis.

However, they have some differences. While five forces model focuses on the external environment in the determination of the viability of a product or service in the market BCG matrix model concentrates on the business brand portfolio and its competitive position in the market. In other words, BCG model tends to believe that the viability or success of a product depends on the market share it commands while five forces model posits that a product’s viability and success depends solely on the external environment particularly on the buyers, suppliers, and competitors.

Works Cited
Dälken, Fabian. Are porter’s five competitive forces still applicable? A critical examination concerning the relevance for today’s business. BS thesis. University of Twente, 2014.
Jurevicius, Ovidijus. “BCG Growth-Share Matrix.” Strategic Management Insight, 2013, https://www.strategicmanagementinsight.com/tools/bcg-matrix-growth-share.html. Accessed 5 Sept 2018.