6 Steps to Better Portfolio Management
1. Have a standing cross-organizational portfolio team: A Portfolio Analysis and Recommendation Team (PART) with a structure, process, cadence, measures, metrics, and portfolio goals will create an efficient and credible environment for portfolio issues to be managed.
2. Define product line strategies: With organization and management input, define product line strategies within the portfolios so they are clear to the organization and the team. Without this critical information the team will not be aligned on ‘where to play and how to win’ at each point of the functional strategies. Create leverage for your product lines by developing them with a product line platform approach.
Check out this whitepaper on the value and benefit of product line strategies, written by Paul O’Connor of The Adept Group.
The PART (portfolio team) runs and analyzes portfolio scenarios based on cross-organizational data. It optimizes and rationalizes the opportunities. The PART then makes portfolio recommendations to business decision makers.
3. Create product line roadmaps: Using the product line strategies and targets for innovation and development, align around product line roadmaps that create a framework of ‘critical-to-roadmap’, events, milestones, technology development or procurement, etc., to track portfolio execution, metrics and progress. If you need some help on how to create smart, effective product line strategies and product line roadmaps, join the ongoing discussion on the Product Line Roadmapping LinkedIn Group.
4. Optimize the portfolio: Gather enough, and the right, data to identify gaps, create and analyze portfolio scenarios, and make recommendations to decision makers on resource allocation issues based on facts not emotions. Try The Adept Group’s PortView™ software for a straightforward graphing tool to visualize portfolio scenarios. It is an easy-to-use efficient way to compare the options.
5. Allocate resources: Track and allocate resources by project and for the total portfolio. Make decisions one level above where the resources are shared so that each decision does not turn into a boxing match.
6. Analyze the risk: Analyze the risk to your projects and assess the risk of your total portfolio so that you can add resources, kill, hold, speed up, slow down, and add more projects to meet the goals the business has set. The Adept Group’s tool RiskAssessor™ for a smart and practical way to assess project and portfolio risk.
Know when there’s an issue
If your portfolio team is not recommending that some projects slow down, while others get killed, or get replaced by projects with more impact, then you may not have a strategy or critical roadmap activities identified.
If your team doesn’t have a framework, such as product line strategies and product line roadmaps, then it will not be able to optimize the allocation of resources and recommend the most strategic and impactful path forward for the development effort. You will be slower and less efficient than you could be otherwise or, worse still, you’ll be slower and less efficient than your competition!
Use these six steps to get started with a data-based approach to the management of your portfolio of new product development and innovation projects. Having a plan will help you to stop wasting time and energy fighting for resources and, instead, your team can get behind a common roadmap and execution plan.
Join The Adept Group in Chicago, April 1 & 2, 2014, for an in-depth knowledge sharing workshop on these important new product development and innovation processes.