First published on 1/30/2013 on www.marketingprofs.com – a preminent resource on best practice marketing technigues for the benefit of the members. Their editorial team cuts through all of this marketing noise to  find the experts and in-the-trenches marketers who know what they are talking  about. Then we take their know-how and mix it with our marketing smarts to turn  it into practical advice that you can actually use through our newsletters,  conferences, seminars, podcast, articles, and webcasts. We must be doing it  right, because we’re a multi-million dollar company that serves a community of  more than 496,000 entrepreneurs, small-business owners, and professional  marketers at the world’s largest corporations. Read more: http://www.marketingprofs.com/about/#ixzz2IHCDaHq8

Product Portfolio Management

It happens all the time.  You learn your active new product programs are either falling behind or the scope of the project has radically changed.  Your teams are telling you they don’t have enough resources to do ALL programs.  Moreover, they seem to be working at cross purposes to one another and have different opinions on the probability of getting the idea to work.  You need to figure out a way to get everyone on the same page so you can keep your new product programs on track and get your ideas to market in a timely fashion.  In this article we will discuss ways to make sure you’re properly resourcing your new product portfolio and then develop tracking tools to make sure they launch on time.  In a prior article (Are your new product ideas attractive enough?), I discussed the major types of new products as well as their differing risk/reward profiles: Type 1:  Simple derivatives/new models of current product lines – easiest to do, lowest risk. Type 2:  Line extensions. Type 3:  New products/innovations in a company’s core category. Type 4:  New product platforms in a new category (to the company) – hardest to do, highest risk. I then recommended using an objective assessment tool to help rank alternative new concept attractiveness from high to low.  The goal is to prioritize your new product portfolio – just like your individual financial investments.  Once completed you then need to determine if your new product portfolio is “balanced” and can potentially deliver results vs. expectations.  There are three critical elements to consider to make sure your new product portfolio is “balanced”.

  • Are your new product ideas strategically aligned with business and innovation growth strategies
  • Is your new product portfolio balanced across product type, risk, time and resources
  • Can they deliver against new product revenue growth expectations – are they sufficient?

One tool than can help in this assessment is development of a new product road map.  A graphical hypothetical product road example is shown below:

New Product Portfolio Management - Product Road Status

 Click On Image To Enlarge

As you can see this graphical plot shows the type of new product, the size of the opportunity, where it is in the new product process as well as its estimated development timeline.  This tool can then be used to help allocate limited development resources to achieve the desired risk vs. reward balance requirements. 

Fortunately, this same tool can also help you track and manage your new product portfolio.  All one needs do is plot progress along the launch time line as well as its current status in the new product development process at different points in time (i.e. quarterly reviews) as shown in the example below:New Product Portfolio Management - Product Road Quarterly Update

 Click On Image To Enlarge

As you can see, these tools are straightforward, easy to understand and really helps to get everyone on the same page.  One minor caveat – in very large/global organizations there can be literally hundreds of new product initiatives making tracking more of a challenge.  Fortunately, there a number of available automated product portfolio management tools on the market.  Once such program is called “Clarity” owned by Computer Associates.  This type of automated tracking programs use a dashboard concept to assist in tracking a large number of new product programs.  See screen shot examples below show how this can be used in larger organizations.

Computer Associates Clarity Program Dashboard Example

 Click On Image To Enlarge

 Computer Associate Clarity Product Portfolio Dashboard Example

Click On Image To Enlarge

One final note.  It’s VERY important both senior and line managers be consistent in their new product resource management decision-making process.  What this means is line managers need to have “straight talk” with their senior leaders regarding realistic risk vs. reward opportunities.  Senior managers also need to realize their teams can’t do everything.  If priorities change too much this sends confusing messages to the organization which can easily cripple getting anything out the door.  Finally, the type of tracking tool that’s used is not as important as having A tool to help manage and track alternative new product concepts.  Product portfolio tracking roadmaps are considered “best practice” at many leading global companies like Proctor and Gamble, General Mills, Coca-Cola, Whirlpool, General Electric and Stanley Black & Decker, etc.  They consistently manage and track their portfolios to make sure they’re delivering the right mix of big and small ideas sufficient to meet the strategic growth objectives of their organizations.  It’s little wonder then that many of these companies are #1 or #2 in their respective product categories.  Can you say your company is on this list? 

Rick Steinbrenner
Chief Marketing Officer/Principal, Brand Marketing Advisors
www.globalbrandguy.com
The Global Brand Guy