Is your external portfolio management provider delivering?
Portfolio management can overwhelm even the most proficient of project managers, especially if a business approaches the concept without sufficient preparation. Therefore, it is hardly surprising when businesses call in external specialists to help rescue their portfolios. This is generally because there is a growing trend of large corporate companies attempting to appear as productive as possible. Rushing a portfolio through the early stages of planning to get specific projects firing on all cylinders may generate immediate improvements, but can have a negative long-term impact when the initial illusion of success quickly collapses.
We are not suggesting that this issue applies to every large business. The majority run their portfolios productively; however some occasionally underestimate the level of work required to unite so many departments, resource pools and budgets. Portfolio management can be defined as the creation and maintenance of a portfolio of programmes and projects that furthers a business towards its strategic goals, so it is perhaps slightly ambitious to presume that every project manager has the necessary time and knowledge to manage each component.
Outsourcing is one solution, although even after the decision has been made to bring in external assistance from a portfolio management expert, businesses still need to ensure they maximise the relationship and their investment.
Coming Together for Success
Every successful portfolio should follow the same steps, many of which are important to ensuring the external team feel well supported and enable them to demonstrate their business value. This includes:
- Managing information so senior management and stakeholders can assess, prioritise, pause and terminate initiatives effectively — the portfolio team will advise how to improve an existing portfolio, however stakeholders can only make an informed decision if everyone is on the same page. Consider creating a standardised language so communication is as clear as possible.
- Creating a portfolio delivery plan that is achievable for both the organisation hiring the external provider and the team tasked with managing the portfolio — risk and benefit management, accountability within each department and what dependencies are involved are all important.
- Sufficient resources and budget allocation — investing in a portfolio management expert, only to provide insufficient resources to the team itself, will likely result in missed milestones and a fractious relationship.
- Monitoring progress and results — the organisation must understand what they wish to achieve from their change initiatives and portfolio. This insight is vital for the team to measure the service they are providing.
Walmart’s founder Sam Walton famously once said, “We’re all working together; that’s the secret,” which can be directly applied to when businesses outsource portfolio management. From the senior board, IT and finance, to human resources and performance teams, portfolio management is a collaborative function that impacts almost every area of a business. A team should not be hired and expected to deliver without insight from each business unit on what they want from the portfolio.
After all, the concept relies on five stages: understanding the business’s processes, expectations and current projects; categorisation to align specific initiatives with strategic objectives; prioritisation to deliver results in the correct order; balancing everything to remain within budget and on-time; and planning for the next component.
The final step is particularly important as portfolios are never complete; they constantly evolve and adapt to the business’s requirements at any given point in time. Trust the chosen provider and ensure they have what they need to drive change forward. With the correct planning structure, delivery environment and expertise in place, portfolio management can be transformed from a complicated, challenging practice into one of the business’s strongest assets.
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