With rapid technological change posing ever more intense competitive challenges, companies are often advised to scrutinize their portfolios and eliminate unprofitable products. Every product, the reasoning goes, must stand on its own bottom line. That, however, may be exactly the wrong mantra for these times. A broader portfolio of products—even if some are, for a time, unprofitable—often can help a company capture more value.
A version of this article appeared in the January 2008 issue of Harvard Business Review.