Managers need to be aware of several serious pitfalls of product development portfolio management. Moreover, organizations need to take steps to overcome these pitfalls in order to gain the true benefits of product development portfolio management.
The difficulties of portfolio management are more encompassing than most managers think and in need of a much broader solution approach than most nirvana-preaching specialists suggest.
The Six Foremost Pitfalls
Consider for a moment that it has been nearly thirty years since organizations were introduced to the stage and gate process. Plus, it is now over fifteen years since portfolio management began as a means to solve many of the shortcomings of stage and gate processes. You would think that by now everybody would understand this stuff better. The problem with gaining insights about portfolio management is that it can take several years to set up. This duration tends to obscure both the desired benefits and the learnings that have accrued. Moreover, even when portfolio managers gain deeper insight into the challenges of portfolio management, the lessons and the recourse to the pitfalls seem not to transfer easily within and outside the organization. The duration and dynamics of portfolio management implementation simply make learning about it very challenging. Yet there are some very important lessons that need to be shared.
No doubt there are many pitfalls in portfolio management. For the sake of brevity, I have cherry-picked the six most common and important pitfalls. Product development professionals should understand them, share them, and by all means, explore the potential recourse to each.
1. Bad Numbers Kill The Messenger
2. Balance. What Balance?
3. Ridiculous Revenue Forecasts
4. Risk Blindness
5. Resource Noise Interference
6. Disregarding The Input