How does being in a state of constant change affect how organisations manage their portfolios of projects and programmes so they align to business goals and meet strategic objectives? Steve Clark, Head of UK Project Delivery, Valcon discusses.
Technological advancement, business imperatives, regulatory diktats – the pressure on organisations to transform themselves to remain competitive and stay relevant is now greater than ever. The last five to ten years has seen a fundamental paradigm shift in the business world with many organisations using projects to handle day to day work rather than operations (BAU). The understanding that projects don’t always come nicely boxed up with a stable scope, end date and a fixed budget has always been present, but with external factors like inflation, resource shortages and supply chain issues changing at an increasing pace, organisations need to be able to react rapidly.
This all means that change and transformation are the norm – being able to flex and cope with an ever-changing landscape has become the traditional ‘business as usual’ state. And with all these projects are different business stakeholders who have different priorities – and theirs is always the most important.
So how does an organisation manage its portfolio of projects and programmes in the best way to align to business goals and meet strategic objectives? There are some key practices that help:
Management of new demand
Demand management is a methodology that can be used to manage, evaluate and plan demand for new change. It’s about managing a new request in such a way you can compare it consistently across the rest of the backlog or inflight portfolio in terms of strategic alignment and its potential benefit to the business. It also provides a robust communication mechanism for product owners or portfolio directors to use in conversations with the business.
Budget and resource capacity are a key tenet of demand management – there is constantly more demand for new change than an organisation’s finances will stretch to, or people can work on. Having a consistent central view of requests from the business allows informed discussion and challenge, which ensures ongoing alignment between delivery teams and business stakeholders.
Continually optimising the portfolio
Considering the three key axis of cost, risk and benefit, portfolio optimisation allows you to take initiatives into delivery having ensured they are the right things to do. This means that the business case stacks up against the benefits framework and the mechanisms are in place to measure the change. It means the people are available to deliver and ready to absorb the change. And arguably most importantly, it means the risk in undertaking the initiative is fully understood when held up against the inflight portfolio in terms of scale of change, required skillsets and interdependencies etc.
Ensure an agile mindset
An agile mindset is not necessarily an agile methodology. Many agile principles can be applied to waterfall portfolios as well: ‘fail fast’, ‘learn early’, ‘don’t fall foul of the sunk cost fallacy’ and many more. The overriding principles are to ensure flexibility, that channels for collaboration are clear and free from bureaucracy and to foster a culture that prioritises adaptability, cross functional collaboration and continuous improvement.
With all the pressures organisations face – the pace of change they have to adapt to, the imperative to stay ahead of the game – it’s no wonder their transformational environment can be difficult to manage. But in this fast-paced business environment, a smart approach around demand management and portfolio optimisation can help them get ahead of the game.
If you would like to chat to Valcon about your approach to demand management and portfolio optimisation, please get in touch: [email protected]
