All entries for Tuesday 26 April 2011

April 26, 2011

RDM– the right portfolio

I think making the right portfolio is one of the hardest things an organisation has to face. Whether to divest or invest is the big querstion. There is always an element of risk involved. You maybe a huge risk taker but its the entire organsiation that you have to take in mind. Risky decisions may often given high returns, but risky decisions are not always the best decisions. Even though we innovate and come up with all the new things, it can be quite hard to make customers accept them. Launching a product is as important as all the decisions relating to its production. Rdm presentation was just a small and very straightforward glimpse of the real world. Considering the market externalities and dynamism it is so difficult to decide on the most appropriate and suitable product mix and then also how to  successfully launch it.

What I find is that decision making tools can be extremely helpful right from the conception stage itself. Currently, when im looking into portfolio planning, the BCG matrix, I find that such tools can proove very helpful in getting the overall view of the organsiation. It plays a cruicial role in evaluating the current perfomance of each the different products, their contribtuion towards the total growth of the company. The best part is that it just doesn't analyse the perfomance of the product but it also suggests what we can do with that product in the future based on their contribution. By classifying each product into a star, question mark, cash cow or dog we can decide to hold, build, harves or divest in it. I'm finding it extremely interesting to learn about such tools. More than the tools theorietical implication, it is their practical implication that plays a stronger role. The best part about the tools is that apart from their practical implication, many of these tools are straightforward and easy to understand. They require minimum effort and reflect the best results. The business analysis becomes so much more simpler by employing these...


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