What is Product Portfolio Management?
Product portfolio management refers to the practice of managing an organization’s entire product portfolio, which consists of all the products the organization has. A product portfolio manager may be responsible for allocating resources for optimal ROI, identifying areas of improvement, and keeping the products aligned with the organization’s broader strategy.
How Does Product Portfolio Management Differ from Product Management?
A product portfolio manager’s responsibilities differ significantly from those of a product manager. While product managers focus on specific products, product portfolio managers are responsible for portfolios of products.
- Product Manager: Usually responsible for a single specific product, its features, product roadmap, and broader strategy.
- Product Portfolio Manager: Responsible for an organization’s portfolio of products, their inter-relationships, and the portfolio’s role in the market.
To illustrate the different responsibilities of these two roles, consider this. A product manager will focus on identifying additional features that could address the needs of a given product’s users. The product portfolio manager, by contrast, will focus on what other products the company might want to build to address the needs of these users.
What are the Objectives of Product Portfolio Management?
Businesses often hire product portfolio managers as they expand their product lines. As their product lines expand, businesses need someone who can take a broad, strategic view of the company’s entire product catalog. So, they often employ product portfolio managers to take this strategic vantage point and identify market opportunities and better ways to allocate resources.
A product manager might be focused entirely on trying to maintain the market viability of a specific product. But what if the product is reaching the “decline” stage of the lifecycle (introduction, growth, maturity, decline) that every product goes through? It might take longer for a product manager to see that the company could benefit from redirecting some of its development and support resources to other initiatives.
Product managers focused on improving the products they are already managing might miss market opportunities to develop new products to address the needs of their user personas, or add new tools to their existing products to attract user personas in adjacent industries.
This is where product portfolio management can help a business. Portfolio managers not only look at the whole product portfolio, but also monitor the broader market at all times. They continuously evaluate all products in terms of how they perform relative to each other, how that relative performance suggests the company should strategically prioritize these products, and what gaps in the portfolio should be filled because they represent the most viable opportunities for new markets, increased revenue, and other business objectives.