Start top-down portfolio planning in four simple stepsOutsource magazine: thought-leadership and outsourcing strategy
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Outsource magazine: thought-leadership and outsourcing strategy | January 24, 2017

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Start top-down portfolio planning in four simple steps

Start top-down portfolio planning in four simple steps
Outsource Magazine

In the wake of the recent General Election, the National Outsourcing Association has claimed the result will trigger continued growth in public sector outsourcing. The industry is of increasing national importance, so delivering results that are spot-on is more vital than ever, with increasing amounts of public money at stake.

Being able to work towards a business-oriented strategy is critical to the success of outsourcers, according to Gartner. It seems simple enough, but the big picture can quickly become lost as different areas of the same business head off in different directions in a bid to meet their own specific departmental goals and targets.

Of course in the short term it’s great when goals are met, but those puzzle pieces need to fit into the bigger picture to be worthwhile for both the outsourcer and, ultimately, the customer.

This is where taking a top-down view comes in: focussing on strategic objectives, rather than taking a bottom-up approach, allows outsourcers to keep a much clearer focus on overall client goals. Top-down portfolio planning allows you to assess and manage work based on its alignment and contribution to wider organisational strategies and objectives.

How successful outsourcers do it

You cannot start implementing a top-down approach without a firm understanding of your customer’s business strategy. Of course, this is a healthy exercise for outsourcers to carry out anyway, and while the majority will already hold strategic meetings as part of the onboarding process, it is something to keep in mind.

Another important piece of prep work is to make sure everybody involved in the process in both organisations has a clear understanding of how decisions are made within the business: who is consulted and which people have final sign off? You’d be surprised by how widely this can vary from firm to firm – it’s very simple, but also absolutely business-critical.

Before you begin, it’s also important to think about things from the point of view of each business unit and department, and how their request would support the overall strategy and objectives of the corporation. Each different area of the business is biased toward their own specific needs. An ‘us and them’ mindset often creeps in, even though different areas of the same business are competing against each other.

Four steps to follow

With the background work completed, there are now four steps to follow that will make the implementation of top-down portfolio planning a success.

  1. Build out and execute an overall Organisational Change Management programme when introducing top-down portfolio planning. Rather than making it up as you go along, make sure the time you’ve spent on this change does not go to waste and is met with acceptance, by having a change management plan in place to onboard everybody properly.
  2. Create an actionable framework that aligns with the company’s strategies and the objectives of your customers. There is no point creating something that attempts to cover too much ground, or cannot be broken down into individual tasks. These should be continually tied back to key areas of focus, and it should be outlined how each will help to meet a company objective. Among other obvious benefits, this should also ensure adoption is an easier process because you are laying the benefits on the table for all to see.
  3. Develop a weighting or scoring mechanism that aligns with your overall focus and culture. You must be able to check on performance, to catch any snags and begin driving things forward. One mistake I’ve seen made with the introduction of top-down portfolio planning in the past, is the use of an existing scoring system that is not fit for purpose. Weighting and scoring projects can help, but it is important to realise it’s not the only metric that the business can use when prioritising within projects.
  4. Set up a vetting process to manage conflicting priorities. I mentioned anticipating problems and nipping them in the bud earlier on, but it is inevitable that at some stage one will arise that you have not thought of. When that happens, there must be a procedure to follow which is fair to all parties, allows everybody to have their voice heard and gives the decision-maker control to make that final call.

Following these four steps will make implementing top-down portfolio planning a relatively painless process, with a clear direction. But this is only the start of the story, as it can be rendered irrelevant by changes in your business focus or culture.

It is important to ensure your plan is constantly updated in line with priorities that have been set by yourself and your customers for the coming year, as these will no doubt change as time progresses. By updating the framework in line with these changes, you will remain on course for success.


About the Author

Jean-Pierre Ullmo 150Jean-Pierre Ullmo is VP EMEA Sales at Changepoint.

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