Why do companies need products at different stages of the product life cycle?

Companies maintain products at different stages of the product life cycle to ensure a balanced operational state and long-term commercial success. Because products naturally follow a trajectory—from initial development and rising production to eventual obsolescence—a company must manage a portfolio of projects to optimize its resources.1

Maintaining this balance is essential for several reasons:

• Resource Optimization: Project managers must ensure that the total development effort aligns with available human and financial resources. By staggering products at various stages, companies avoid periods where resources are either underutilized or dangerously overloaded.1
• Capacity Management: Production managers rely on a mix of products to keep manufacturing capacity and resources fully loaded without exceeding limits.1
• Continuous Innovation: To avoid the decline that occurs when products become obsolete or are replaced, companies require a steady flow of new research and development proposals. This pipeline allows firms to select projects that promise the most profitable use of available funds.1

Ultimately, this strategic approach helps companies mitigate the risks associated with product life cycles and ensures that innovation remains a consistent driver of the business.1