ASPECTS OF PRODUCT PORTFOLIO MANAGEMENT

Imagine a company has six products, how should it allocate its limited marketing resources among them? Should It invest in each product equally or emphasize just a few? Which ones? Why those? These all requires a systematic Product Portfolio Management. SO welcome to the world of product portfolio management.

Product portfolio management helps Companies make better resource allocation, marketing activity, and product strategy decisions by providing an overall picture of both the present and future projects   market position for every products.

A product portfolio comprise of different categories of products, different product lines and finally the single product itself. Management is needed on all the three levels of a product portfolio. A Company needs managers for managing individual products, managing product lines and finally the top level management which manages the complete portfolio.

Let’s look an organization from a wider view. An organization is comprised of a number of different departments, and all focused towards one goal – the betterment of the organization. In the same manner, product portfolio of a Company should be such that each and every product in the portfolio is focused towards one goal – Bringing the organization on top by optimally using the resources available.

ASPECTS OF PRODUCT PORTFOLIO  MANAGEMENT

·         Maximize  the  value of products:

Different products of the Company generate different profits.

·         Identify the optimal product mix:

A portfolio that spans multiple market segments, product categories, and technologies helps protects the company against marketplace changes. Investing the returns from current products into longer-term products helps stabilize company’s returns over time. Established, low-risk products help offset your riskier ones.

·         Ensure internal strategic alignment:

 Company’s success is in danger if its product portfolio fails to support  broader business strategies, priorities and objectives; both today and in the immediate future.

·         Allocate resources properly:

 Companies have limited human and financial resources. Investing in the right products has an immediate and significant impact on profitability

BENEFITS OF PRODUCT PORTFOLIO MANAGEMENT:

•   It maximizes the return on product innovation investment.
•    It maintains the competitive position.
•    It helps the Company in using its scarce resources with optimum utilization.
•     It helps in achieving balance
•     It enables objective project selection. 

IMPORTANCE OF PORTFOLIO MANAGEMENT:

A company without proper Product Portfolio Management and project selection face problem may be of slower growth rate. So if a new product development faces any plague its all because of ineffective Product portfolio Management.

Thus Portfolio Management is about doing the right projects. If the Company pick the right projects, the result is an enviable portfolio of high value projects: a portfolio that is properly balanced and most importantly, supports the business strategy