Portfolio management: Finding growth opportunities in a restructured electricity marketplace. Final report
- Mercer Management Consulting, Inc. (United States)
Energy services companies are rapidly creating a wide array of new products and services for their customers. To penetrate the marketplace most effectively, however, these new offerings should be integrated into cohesive portfolios that meet the needs of key customer segments. This report explores the techniques of portfolio management and describes how this tool can help bring greater balance and focus to an energy provider`s product and service portfolios. Portfolio management provides a process for initiating, overseeing, and exiting from diverse investments on the basis of not only the merits of each individual investment, but also the merits of those investments in combination. The principles of portfolio management can be applied to various types of investments, including those involving lines of business, new product initiatives, and project commitments. With the rapid transition to a more competitive environment, these types of market-oriented investments are receiving greater scrutiny in the energy services industry. Accordingly, portfolio management techniques are becoming increasingly important business tools. The project team considers three different categories of portfolio management within the context of the energy services industry. Passive portfolio management focuses on choosing the combination of products/services that will provide the most favorable trade-off of risk and return for a given risk tolerance. Balanced portfolio management provides a more aggressive set of techniques that look broadly at a company`s multiple objectives and assist in deploying resources to achieve balance along multiple dimensions. Strategic portfolio management goes even further by helping to define a set of synergistic offerings that reinforce one another and the company`s strategic direction. In this report the team also documents case studies of companies that profited from their portfolio management efforts and presents a project design for developing and implementing a portfolio management process. This report describes a four-phase project design that covers the mobilization, assessment, design, and implementation of a portfolio management process.
- Research Organization:
- Electric Power Research Inst., Palo Alto, CA (United States); Mercer Management Consulting, Inc. (United States)
- Sponsoring Organization:
- Electric Power Research Inst., Palo Alto, CA (United States)
- OSTI ID:
- 355050
- Report Number(s):
- EPRI-TR--108106
- Country of Publication:
- United States
- Language:
- English
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