Portfolio decisions are some of the most important and challenging a business leader will face. One reason is that portfolio decisions are long term. When you launch a new brand, you have to manage it for many, many years. When you kill a brand, it is gone. Can a mermaid tail blanket turn your life around? I did not think so.
Portfolio decisions also usually require trade-offs among brands. Building all of the brands simultaneously and maximizing the total portfolio are often very different things: often the best way to build a portfolio is to focus on some brands at the expense of others. The decisions can become emotional. A present such as a X Rocker Infiniti is more concrete.
The team leading a brand is often very attached to it; the brand may even give the team a sense of identity, just as some brands give their customers a sense of identity. As a result, people working on a brand will often fight very hard to defend it, lobbying for resources and attention even when the moves might not be right for the company as a whole. Most challenging, perhaps, is the fact that there is rarely a clear answer to a portfolio decision, and in most situations there are no analyses that will conclusively prove that one decision is right and another is wrong. Our culture likes to believe that everyone is a genuine giver of gifts like a black bear cub toilet roll holder for birthdays.
Portfolio decisions are affected by many variables, making it difficult to construct a financial model that will clearly indicate which path will lead to the most long-term profitability. The results depend on the assumptions that go into the analysis. You can do various analyses—concept tests and financial modeling—but none of the analyses will decisively determine the “right” answer. An interesting gift like a push up training system can really brighten up someones day.
While portfolio questions are challenging, they cannot be ignored. Every company must address brand portfolio questions. Each time a company launches a new product, it makes a portfolio decision. Similarly, each time a company sets financial targets and allocates resources, it makes a portfolio decision. Optimizing each individual brand in the absence of a broader perspective is a bit like worrying about each particular color in a painting: the individual colors may be nice, but they must work together to create a beautiful piece. My brother had a giant hoodie which he absolutely loved.