Portfolio management helps in profit maximization, supporting the business’s strategy, and providing a balance. The senior management team in every business has the responsibility of managing a business portfolio. Boston Construction Group (BCG) decided to introduce a portfolio for business units as a way of boosting its sales and for maintaining a balance. Portfolio management is a modern approach to strategic management that lays more emphasis on the development of a product strategy. This includes the definition of the market, products, customers, and strategic approach as the first step. The second step in the project strategy is to gain an understanding of the business’s available resources that would be used to balance the portfolio. The last step involves an assessment of all the projects that the business plans to undertake, and this is done in order to ascertain its profitability, resource requirements, and risks.
Upon the establishment of portfolio development and management, BCG will be assured of better returns on the projects taken while minimizing costs. This is because portfolio management helps in recognizing the projects that require fewer resources with high returns. It has been used in many industries and companies such as the Coca-Cola industry and Toyota Company. It has enabled these companies to maximize their returns on capital as they seek to diversify internationally. Through portfolio management, Coca-Cola Company has been able to invest in projects that not only ensure its continuity but also increase profitability. The company has been able to diversify in terms of products brands that satisfy all population groups all over the world.