Pages: 10

By any measure, Dean Kamen is an engineering giant – Hall of Fame inventor with over 1000 patents, founder of for-profit and non-profits, award-winning technologist and a designer committed to using his skills to create medical products to help people become more self-sufficient. His talent has been touted by other well-known technologists and entrepreneurs, like Steve Jobs and Jeff Bezos. But two of his most ambitious products – an all-terrain wheelchair and the personal transporter known as Segway – were marketplace failures. Kamen seemed to be aware of portfolio management. He leveraged the proceeds from his first company, AutoSyringe, to found DEKA Research and Development in 1982 with a decided portfolio focus on medical innovations. DEKA has an active portfolio of products, including a subcutaneous pump, a filter for clean water in developing countries, an innovative electrical generator that uses multiple fuels, and a unique, integrated soft drink flavor dispenser (National Academy of Engineering, n.d.).

Pages: 20

You have great services, ideas for delightful products, so why do you need something as complex-sounding as a Product Portfolio Management (PPM) system? This chapter answers that valid question by explaining the essential imperatives, fundamental principles and expected benefits of a disciplined system. A business product is something tangible sold to customers, like a renewable energy turbine, while a service is the intangible provided to a business, like consulting or software as a service. To simplify things, we refer to management of both as PPM. Design is important to PPM and product qualities have to be desirable by the customer, feasible to develop and deploy and financially sustainable for continuing profit. The chapter describes the categories of PPM benefits and sets the stage for the application of foresight in PPM. These are PPM heuristics that are explained in greater detail throughout the remainder of the book, and which are the foundation for an effective portfolio management system.

Pages: 31

What is the best PPM model to follow? This chapter reviews the current models and frameworks available for PPM and offers guidance on criteria and ways to select the best PPM model for an organization. It also outlines approaches to overcome common PPM hurdles and challenges. The chapter provides context and methods to create a PPM ecosystem, within the organization and externally with industry partners and other stakeholders to monitor and improve the existing product line and prepare for additions through effective resource allocation. It offers ways to operate in dynamic environments and emphasizes the need for portfolio managers to be nimble. It describes four popular portfolio assessment frameworks: Ansoff’s Matrix, GE-McKinsey Screen, Innovation Ambition Matrix, and BCG Matrix, complemented by Porter’s strategic competition model, and offers guidance on their uses, limitations, and advantages. It also offers a thumbnail of disruptive innovation, a concept that plays throughout the book. It wraps with a view of a balanced portfolio and example case studies.

Pages: 22

This chapter describes environmental, social and governance (ESG) criteria and its evolving impact on PPM and business operations, emphasizing their importance for the sustainability of business, including how investors factor ESG criteria and business decisions in making investment choices that affect portfolio management. The chapter describes the challenges for applying ESG criteria to portfolio management and outlines the advantages of ESG compliance, and also reviews emerging controversy over its use. It also offers lessons learned for designing and executing ESG initiatives, while describing typical challenges to be overcome and how collaboration is key to issue resolution. At the same time, shareholders and some corporate leaderships are pushing back on ESG, claiming that ESG erodes corporate profits. It isn’t clear if this dilution of support is temporary or a sign of more widespread dissatisfaction with the concept centered in the politics of the U.S. which will change with future administrations.

Pages: 17

This is a chapter intended for experienced organizations that have a portfolio process and an existing portfolio. It recommends to approach product portfolio innovation with an open systems mindset that recognizes the many influences on the innovation process, even as you face seemingly unpredictable, uncertain and unintended conditions and consequences. The chapter argues that there is need for innovation in product development and portfolio management to improve corporate performance. There is no single, best way to innovate – context and needs vary considerably. Having said that the chapter suggests the use of a system developed for air combat that has relevance for organizational planning and execution. The approach is called the OODA loop, which stands for observe, orient, decide and act. Given the serious emergence of artificial intelligence for organizational operations, the chapter gives an example of the way that ChatGPT could contribute to innovation. It describes the integration of innovation and the OODA loop and offers candidate performance metrics.

Pages: 29

This chapter offers a way to plan and execute a foresight initiative which is designed to anticipate potential future operational environments, opportunities and risks through the discipline of foresight. The foresight planners and analysts can choose any time frames, but generally the focus is on 5-20 years, but is sometimes shorter and seldom longer. An exercise focused on results for a portfolio would likely be shorter for tactical results and longer for a strategic focus. The core of a foresight initiative is in the sensing and sensemaking which involves methodical collection and reviews of trends, including events that might be early warnings, new science and technology efforts, as well as shifts in economics and social-cultural affairs, all in light of organizational vision and goals.

Pages: 18

Portfolio rationalization is an ongoing process of modifying your project portfolio to align with shifting market and economic factors or changes in your organization’s strategic focus. This chapter focuses on the portfolio’s performance after setting a foundation explaining why periodic product portfolio review is essential. It identifies the key considerations for rationalizing the product portfolio and offers specific guidance on ways to rationalize the portfolio. The chapter also explains the reasons for and process of pruning the portfolio, wrapping up with a discussion of sustainability impacts on rationalization. Corporations have to periodically review their portfolio to adapt to evolving market and competitive environments and to execute key actions necessary for optimum portfolio performance. Products in the portfolio also need changes including modifications, alterations, additions of new features, to repackage everything and reposition in the marketplace. All these are done to ensure to ensure that product is relevant and can meet changing customer expectations and at par or better than other competitive products in the marketplace.

Pages: 18

This chapter address the challenges and impacts of managing changes in management of product portfolios, offering an overview of the imperatives associated with portfolio change management. While change management is generally asesociated with internal operations and planning, the broad nature of portfolio management calls for external attention, also, including change management for customer interactions and expectations. Regardless, in these complex, disruptive times, change management takes on a critical role to manage transformation and innovation. The chapter discusses general approaches for state-wise implementation of implications of change management in product portfolio to remain relevant and current in the marketplace taking cases and examples from real life. This chapter offers ways to handle changes in business environment managing performance. Changes run the spectrum from gradual and incremental through significant and radical or even deeply disruptive. It discusses frameworks to tailor and manage implications of change management in a product portfolio.

Pages: 22

This chapter looks at the definition of strategic alignment in terms of action-oriented ways to integrate corporate strategy into portfolio, execution and performance. The chapter reflects on strategy-portfolio alignment in light of rationale, metrics, internal and external stakeholders, components to be aligned, and where alignment is best handled. In addition to offering insights into alignment satisfaction, the chapter also treats alignment of portfolio management with strategy in the context of organization as a complex adaptive system, including an eco-system, that goes through high-level and more granular life cycle activities. The overall portfolio helps to shape and sustain the life cycle at the corporate strategic level, while the products cycle through at different rates. Because of the complexity of alignment, the chapter recommends that understanding of the portfolio as a complex adaptive system could help managers and stakeholders better comprehend the operational, strategic and tactical implications of portfolio design and balancing decisions. A communications map, aimed at sharing portfolio status and insights is useful to understand and manage the portfolio. The chapter also recommends attention to risk and stress testing to ensure the alignment can handle multiple situations.

Pages: 21

This chapter describes one of the most revolutionary technologies created, artificial intelligence (AI) which has the potential to change human-machine relations in ways unimaginable save for science fiction. The chapter gives a brief historical background of AI and moves into a discussion of ways that portfolio managers could use its power to manage product development, integration and marketing. At the same time, it is important to recognize possible challenges, like AI bias and “hallucinations” where AI programs create fiction and present it as fact. It is, therefore, important to have a strategic and integrated approach to AI implementation, balancing innovation with ethical considerations and resource management. By leveraging AI, organizations can enhance decision-making, improve operational efficiency and maintain a competitive advantage in a dynamic business landscape. There also is a need for continuous innovation and ethical considerations in leveraging AI’s potential, ensuring that businesses remain agile, responsive and resilient in the face of evolving challenges and opportunities.

Pages: 22

If something cannot be measured, it cannot be improved. In this chapter we discuss performance measurement criteria and process, and offer a proposed maturity model of the product portfolio management processes. As such performance of the current portfolio members should be measured and target to improve also needs to be decided. The target of performance of a product in the current year will be depended on couple of factors including the product performance in the last year, category growth rate , key identified competitor’s activities and performance, key insights of the category review to identify opportunities available to exploit in addition to the objective businesses have set to achieve the desired level of performance which again will depend on the various factors like the stages of the life cycle of the product, investment required to achieve the desired growth rate, product’s contribution to the business, risks involved as well affordability and so on. To achieve that target, resources will be required. Organizations thus have to decide how judiciously they can deploy their resources to achieve the best overall performance. Each member of the portfolio will thus have a performance delivery objective and to achieve that objective product management team would demand resources. Once the performance criteria is set and decided, primary task would therefore be how to measure those product portfolio performance criteria. There are standard criteria of performance which all organizations will include and estimate. However, there also could be organization specific criteria which can vary from organization to organization depending on their own position in the marketplace in relation to their specific objectives to achieve as well as competitive scenario. This chapter will address the general criteria for portfolio performance as well as selective criteria which are also required to be measured under specific circumstances and as such selective criteria would be only situation specific and suggests a combination of the Balanced Scorecard and a portfolio management maturity model as a solution.

Pages: 11

This summary chapter reiterates that product portfolio management (PPM) can be dramatically improved by following time tested portfolio imperatives and practices – discipline, leveraging revolutionary technologies and techniques – disruption, and, using rigorous procedures to peer into the future – foresight, and engaging in innovative practices that include the OODA loop. High-performing companies know how to manage and balance their products and services in a structured approach, including PPM. They also have a PPM mindset that is dedicated to openness, future-orientation, analytical dedication, innovation and internal and external collaboration. They focus on customer needs and wants, emerging trends and ecosystem realities, and recognize the differences between technology as an enabler and technology as a product. Great companies practice disciplined, balanced PPM practices, paying attention to the risks of an unbalanced portfolio. The Imperatives of PPM that contribute to high performance starts with dedicated senior leadership and culture that encourages innovation and alignment of strategy with the portfolio. Any PPM team should include internal and external stakeholders from across the ecosystem and will be guided by a charter that will produce transparent PPM goals and metrics, including ethics and a framework for assessment. The team will leverage foresight techniques and assess emerging trends to discern product and service directions and the sense of the competitive landscape, with the skills needed to perform.