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Abstract: To be successful, innovations must be introduced to the market in the form of products and services. Product Portfolio Management is a field focused on decision-making and execution of innovation development and commercialization activities. Drawing on the resource-based-view of the firm, this research examines Product Portfolio Management from the perspective of relevant capabilities, business impact and as practical challenges. Conducted as a survey, industry practitioner views were collected. The five most important capabilities in terms of business impact were identified as: Identifying & meeting customer needs, Creating product roadmaps and planning, Product pricing and positioning, Value proposition definition and Market and customer segmentation. Findings reinforced the view that practitioners see Product Portfolio Management as having a strong positive impact on business performance. Challenges are seen in the role and authority given to Product Management organizations and resource constraints when dealing with new product introductions and managing extensive existing portfolios.
Keywords: Innovation Management; Product Portfolio Management; Competitive Advantage; Dynamic Capabilities; Business Performance; Measuring innovation; New Product Introduction; Product Development
Introduction
To become commercially successful and to have a positive impact on business performance, innovations must be packaged into products and services and made available to their relevant customers. This article examines the innovation commercialization activities of technology firms from the point of view of Product Portfolio Management and related activities. The objective of the paper is to identify the main capabilities and measure the business performance impact of Product Portfolio Management activities of technology firms. Common industry practitioner challenges are also presented.
Innovation is a concept with a variety of different definitions found in literature but many focus on newness or novelty in products, market activities or processes (Edison, et al., 2013). In technology intensive industries innovation can be interpreted as taking the form of a process of introducing new or enhanced products and services to the market providing additional value to customers and a unique, defensible competitive position for the firm (Hauser, et al., 2006). This concept of introducing new or enhanced products to the market is used as the definition of innovation in this article.
Introducing newness and novelty to the market is challenging and based on earlier research and industry practitioner experience, it can be stated that innovation initiatives have been...