A business portfolio is the collection of businesses, products, and strategic business units (SBUs) that make up a company. It is a strategic framework that reflects the company’s current performance and its potential for future growth.
Managing a business portfolio is a key task for senior management and involves analyzing the market growth and relative market share of each SBU, often using tools such as the Boston Consulting Group Matrix (BCG Matrix). The goal is to allocate resources in an optimal manner—investing in growing and profitable businesses (“Stars” or “Cash Cows”) and reducing or eliminating underperforming ones (“Dogs” or “Question Marks”).
