Fantasy Film Company: Business Portfolio and Dynamic Capabilities

This report examines Fantasy Film, a digital animation studio, focusing on its business portfolio and dynamic capabilities. The portfolio analysis employs the BCG Matrix, GE-McKinsey Matrix, and Synergy Matrix to evaluate Fantasy Film's four business units: Fantaspace, Advantage, Anisoft, and DigiFX. The report recommends increasing investment in Fantaspace, maintaining low investment in Advantage, continuing investment in Anisoft, and selling or liquidating DigiFX. The dynamic capability section assesses Fantasy Film's ability to adapt and leverage its resources, highlighting weaknesses in management structure and the need for improved knowledge sharing and strategic alignment. Recommendations include decentralizing management, fostering innovation through cross-functional teams, and building dynamic business capabilities by exploring new markets and technologies. The report concludes that Fantasy Film can enhance its competitive advantage by transforming its management style, promoting innovation, and developing a culture that supports adaptation and growth. Desklib offers this report as a valuable resource for students studying business strategy and portfolio management.

Business Portfolio and
Dynamic Capability
Development Report
Fantasy Film
[Student Name] – [Student Number]

Introduction
Fantasy Film Business Portfolio
•The study seeks to address dynamic strategies and disruptive innovation that
have been applied by the Fantasy Film Company for its survival in the
competitive film industry.
•Fantasy Film is a digital animation studio with its headquarters in Sydney.
Besides Sydney, the company has other production facilities in Los Angeles,
San Francisco and Brisbane.
•Fantasy Film operates four business units each serving a differentiated market
segment. The business units are Fantaspace, Advantage, Anisoft, and DigiTX.
•Each business unit has its managerial structure which makes business and
investment decisions.
•The study is divided into two parts namely: Portfolio analysis and Dynamic
Capabilities.
Portfolio analysis addresses the performance aspect of the business units
and the Company in general.
Dynamic capabilities address how well the company can apply its resources
to gain a competitive advantage in the market.

Portfolio Analysis: Introduction
• Portfolio analysis refer to analysing an organisation’s product or unit
mix to establish an optimum method of allocating resources.
• Two measures of portfolio analysis are market share and market
growth rate.
• Portfolio analysis will help in determining which business unit
Fantasy Film should;
 Maintain at its current state,
 Invest more resources into,
 Dispose of by selling out.
• The portfolio analysis will be completed using three analysis
techniques;
 BCG Matrix
 GE-McKinsey Matrix
 Synergy Matrix

BCG Matrix
?
Relative Market Share
Market Growth Rate

GE-McKinsey Matrix
Growth
Competitive strength of
business unit
High Med Low
Industry attractiveness High
Med
Low
Growth
Harvest
Selective Harvest
HarvestSelective
SelectiveGrowth

Synergy Matrix
Threshold of acceptance
Misfits
Incoming:
Benefits from belonging
to portfolio
+-
Fits
+
-
Outgoing:
Benefit to portfolio
Altruists
Givers
Parasites
Takers

Business categorisation
BCG
Matrix
GE-McKinsey
Matrix
Synergy
Matrix
Fantaspace Star Growth Fits
Advantage Cash Cow Selective Giver
Anisoft Question Mark Selective Taker
DigiFX Dog Harvest Misfits

Fantaspace
Analysis
•The business unit operates in a highly competitive segment.
Fantaspace requires high investment to maintain its high growth
rate in the market.
•The business unit is highly attractive.
•Fantasy Film should increase its investment to maintain/ improve
the potential for growth and generate high income (McKinsey &
Company, 2015, p. 112).
Recommendations
•The business unit operates in a highly competitive segment.
Fantaspace requires high investment to maintain its high growth
rate in the market.
•The business unit is highly attractive.
•Fantasy Film should increase its investment to maintain/ improve
the potential for growth and generate high income (McKinsey &
Company, 2015, p. 112).

Advantage
Analysis
•The business unit is at its maturity stage.
•The company can continue earning high income from
low investment into the unit.
•The Business unity is worth investing in to maintain
the market share and revenue realised from it (Hult,
2012, p. 127).
•Lastly, the business unit is categorised as a giver
hence a continued investment is justifiable
Recommendations
•Fantasy Film should maintain the business unit
through low investment.

Anisoft
Analysis
•The Anisoft business unit has the potential to
grow into a star and a cash cow.
•On the other hand, is the market share is not
maintained, the unit can become a dog.
•Based on the synergy matrix, Fantasy Film
should continue investing in the unit (Alon &
Eugene, 2012, p. 99).
Recommendations
Anisoft has a potential to grow in the future.
Therefore, Fantasy Film should continue investing
in the unit to gain a higher market share.

DigiFX
Analysis
•DigiFX has a low market share and a low market
growth rate. Therefore, no further investment should
be made in the business unit.
•Based on the GE- McKinsey Matrix, the company
should either sell or liquidate DigiFX
•Synergy matrix shows that DigiFX is a misfit for the
company’s business portfolio (Gluck, 1985, p. 18).
Recommendations
Fantasy Film should not invest more capital in the
business unit. The company should consider selling
out DigiFX.

Conclusion
Fantasy Film Business Portfolio
•Portfolio analysis evaluated the four business units operated
by Fantasy Film Company.
•The business units are Fantaspace, Advantage, Anisoft, and
DigiFX.
•The portfolio analysis techniques that were used are BCG
matrix, GE- McKinsey Matrix and Synergy matrix.
•The following recommendations have been made for the
company;
a.Increase the resources and financial investment for
Fantaspace unit
b.maintain low investment for Advantage unit
c.Continue investing into Anisoft unit
d.Sell / liquidate DigiFX unit