Portfolio Value Management

Correct Answer: Identify synergies between your company and the acquired firm and integrate relevant projects from the firm into the portfolio.

The ideal way to add value following a merger is to identify synergies between the two companies and integrate relevant projects from the acquired firm into the portfolio (pk: 155690). This allows for cooperative performance which often results in increased efficiency and innovation. Ignoring the smaller firm's portfolio (pk: 155691) is not beneficial as you may miss out on valuable projects they have. Simply replacing underperforming projects with top-performing ones from the acquired firm's portfolio irrespective of strategic alignment (pk: 155692) may not bring the expected results as it could disturb the balance in your current portfolio. Immediately dissolving all of the smaller firm's projects (pk: 155693) is also not the best way to create value because you risk losing potentially potentially valuable assets and compromising the diversification of your company's portfolio.

Correct Answer: Re-align the portfolio to meet the new strategic objectives and launch the products in phases.

The best approach is to 'Re-align the portfolio to meet the new strategic objectives and launch the products in phases.' This will ensure that the portfolio not only aligns with the company's new strategy but also properly managed, allowing for an efficient launch. If a product encounters unexpected issues, launching in phases allows a company to make necessary corrections without affecting the entire portfolio. The other methods are not ideal because discontinuing all ongoing projects could harm the company if the new products do not perform as expected. Also, allowing teams to decide the best way to incorporate new products could create inconsistency and confusion. Finally, launching all 3 products at the same time could overwhelm the market and the company's resources, potentially leading to failure in achieving the desired outcome.

Correct Answer: Reassess project priorities and reallocate resources to competitive initiatives

The best response to a new competitor entering the market with disruptive technology is to reassess project priorities and reallocate resources to competitive initiatives. This approach allows the portfolio manager to:

1. Quickly adapt to the changing market conditions
2. Focus on projects that can counter the competitor's advantage
3. Maintain portfolio value by staying competitive

This strategy is proactive and allows for flexibility in resource allocation to address the new threat.

The other options are less effective:

Continuing with the current portfolio strategy is too passive and may lead to loss of market share.

Investing heavily in replicating the competitor's technology may be costly and time-consuming, potentially leaving the company vulnerable in the short term.

Reducing projects to focus on core competencies and cost-cutting might help financially but doesn't address the competitive threat directly and could limit future growth opportunities.

The chosen answer provides the best balance of adaptability, competitiveness, and resource management to maintain portfolio value in the face of disruptive competition.