Product Portfolio Optimization

Companies are burdened with an ever-growing portfolio of products and services, while customers struggle with overchoice. But portfolio optimization is rife with pitfalls. We can guide you.

Product proliferation is bad for business

Whale Curve: 20%-30% of products typically generate 300% of a company’s profits

After years of line extensions, unfocused product and service expansion, and poor product lifecycle management practices, businesses are drowning in too many products and services. The result: inflated costs, high levels of working capital, poor execution, and lack of focus. Customers suffer too—they’re on the receiving end of poor service levels and left to navigate an overwhelming portfolio. Many give up and go elsewhere. Getting your portfolio right is as much about keeping and growing your customers as it is about becoming a more profitable business.


We typically see 20%-35% of a company’s products or services generate 300% of profitability, while the rest are a drag on the business, shown on the so-called 'Whale Curve'. It is not surprising that portfolio optimization is at the top of many companies to-do lists. 

Companies struggle with portfolio optimization

Unfortunately, these exercises frequently fall short—languishing in a never-ending debate between supply chain and marketing or being reduced to a ’chop the tail’ exercise with no clear benefits. While leaders can see the opportunity that would come from simplification, how to address the situation seems elusive:

  • How to quantify the financial benefits of complexity reduction
  • How to ensure that the focus of your customer reshaping is customer value
  • How to ensure that the business actually captures identified benefits
reality of portfolio optimization

WP&C: The leaders in portfolio optimization

Wilson Perumal & Company is the leader in portfolio optimization, with unique methodology and deep insights, honed through many years of experience. Our difference includes:

  • A specialized team, with more cycles per person than any other consulting firm
  • A robust, holistic methodology to guide companies through the process
  • Our 5-facet framework that assesses financial and operational impacts, and also incorporates customer, market, and strategic elements
  • Our proprietary approach for quantifying complexity costs and revealing portfolio opportunities—Square Root Costing
  • Expertise not just in the analysis of opportunities, but also in the execution and capture of benefits from portfolio optimization
WP&C: The leaders in portfolio optimization

Not all revenue is good revenue

Executives recognize the value of portfolio optimization, but many efforts merely trim the tail. Go deeper to achieve a 20%–40% improvement in EBITDA. Read our latest issue of Vantage Point to learn how using our 5 Facet Approach.

Read the Vantage Point

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CPG Leaders: Unlock significant benefits with portfolio optimization

Portfolio optimization remains an under-utilized lever for value creation in most companies, despite many leaders recognizing the growing complexity in their organizations. Learn how CPG companies can increase EBITDA 10–30% and reduce working capital 10–25%.


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Most businesses don't know where they really make money

Traditionally, businesses used standard costs based on fixed and variable costs to make decisions regarding product rationalization, pricing, and new product development. Today, however, complexity has changed the game. Armed with the knowledge from WP&C's Square Root Costing, companies can build better strategies around business problems such as product mix, innovation, and international expansion—enabling them to better compete in our complex world.

Download the Vantage Point

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Journal of cost management

Revealing the cost of complexity

Your standard costs are wrong! Read our latest research published by Cost Management to uncover how traditional costing methods undercost low-volume products, and learn about the alternative method: Square Root Costing.

Read the Article

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Refocus on the core for profit and growth

As companies seek to drive growth, they are often overwhelmed by complexity resulting from product proliferation. Portfolio complexity can quickly lead to decreased margins while also typing up valuable capital. When done right, portfolio optimization can bring immediate benefits to support resiliency. 

Download the Guide

portfolio optimization offering introduction

Learn how we helped a leading cosmetics company tackle complexity to regain profitability

“WP&C is helping us transform our business. Their insights are phenomenal!”
Dave Hoogmoed
Dave Hoogmoed, President Land O’Lakes Purina Feed
“Wilson Perumal & Company's approach treats complexity as the enemy. Declaring war is the most direct route to an efficient, profitable enterprise. We declared war on the complexity in our portfolio, resulting in streamlined customer offerings and a more nimble business.”
Ed Lonergan
Ed Lonergan, President and CEO Diversey, Inc.
“This was a quick and painless way to understand our true product profitability, and it challenges how we think about our business. I am extremely pleased with the results.”
Fernando Palacios
Fernando Palacios, EVP and Chief Integrated Supply Chain Officer MillerCoors LLC
“WP&C’s insights into our portfolio, cost structure and growth drivers have changed the way we think about our business. The brand management playbooks they developed for the business will be critical to how we make decisions going forward.”
Hilliard Lombard
Hilliard Lombard, Managing Director Valeo Foods Group Ltd.
“I have been more than pleased with what you have been able to accomplish in this time. Beyond my expectations...Spectacular!”
Peter Benton
Peter Benton, COO Worldwide Clinical Trials, Inc.
“Fantastic piece of work! You’ve really shed a lot of light on our business. Inmarsat will benefit enormously from your contribution and we will be using your structured thinking to guide us through the decision-making to come.”
Rupert Pearce
Rupert Pearce, CEO Inmarsat plc
“If you take all six times [past projects] where we looked at this, over the past ten years, and rolled them all up together, and multiplied by ten, it would still not be as good as this work.”
Bill McNabb
Bill McNabb, CEO Vanguard Group, Inc
“Army personnel credit the collaboration between Joint Munitions Command, CAAA's higher headquarters, and consulting firm Wilson Perumal & Company for identifying areas to improve the munitions distribution process.”
U.S. Army News
U.S. Army News

Is your company ready for transformation?