Portfolio Diversification

Portfolio diversification is the process where a company strategically broadens the market exposure of its business operations to make it less vulnerable to a range of economic and market risks. The process of portfolio diversification can take a large number of approaches, including increasing the number of product lines, the geographic range of markets, the exposure to more market segments and many more examples.

Portfolio diversification is a strong strategic choice under a wide range of circumstances, and will be performed numerous times over a company’s lifespan. Every time that a company has readjusted its business operations as a result of general expansion or as a response to specific market circumstances is an ideal time to review the diversification of its business portfolio and to make the necessary adjustments.

Because portfolio diversification is such a broad process that responds to a range of circumstances and is approached by using a variety of methods, it is ideal to have an experienced consultant at hand to help with the strategic planning or implementation.

A Consultport consultant can steer your portfolio diversification effort down the correct course and ensures that your company is protected from sudden shifts in the relevant markets.

  • Business Portfolio Review: One of the key elements of any effective portfolio diversification effort is a clear understanding of the company’s existing operations and its long-term strategy. Successful portfolio diversifications are planned using a company’s long-term strategy as a guiding framework that all changes must operate within.
  • Designing the Portfolio Diversification Strategy: The Portfolio diversification is a rare enough event in a company that many employees will have little or no experience with its successful undertaking. Consultants are ideal for portfolio diversification strategy design because they have the knowledge and experiences to ensure that the process is fast, effective, inexpensive and minimises the disruption of business operations.
  • Portfolio Diversification Workshop: In companies with a strong range of knowledge and experience at its management level, occasionally all that is required is a quick refresher on basic portfolio diversification principles and an update on current best practices. Consultants are available to provide brief workshops on portfolio diversification that will ensure that your team is prepared to produce the best possible effort.
  • Portfolio Diversification Implementation: Some companies find that they do not have the qualified people available to ensure that their portfolio diversification strategy is properly implemented. Firstly, consultants have more knowledge and experience in terms of implementing portfolio diversification strategies, but moreover having an outsider guiding the process can help maintaining its focus and objectivity.
  • Portfolio Market Research: From identifying alternate potential products to finding strong candidates for market segmentation or geographic expansion, specialist consultants can provide a caliber of market research for portfolio diversification efforts that goes far beyond what most companies can produce internally. Market research consultants employ a range of industry best practices and market metrics that will bring value to the table for any effort at portfolio diversification.

Read some related publications

protfolio diversification, Portfolio Diversification

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