by Jen L. Skrabak, PMP, PfMP
Successfully implementing strategic initiatives is a high priority for most organizations; however, few organizations are doing it well, if at all. In fact, only 10 percent are aligning portfolio management with strategy implementation.
Based on my experience, there are seven critical success factors to align portfolio management with strategy:
1. Agility: This is a broad umbrella for organizational culture and processes that are nimble and versatile. Being nimble suggests speed in reacting and being versatile suggests flexibility and adaptability. It’s crucial to build a nimble and flexible organization and portfolio management processes to take advantage of internal or external changes. Portfolio management must be seen as the enabler of strategic change and anticipate iterative, incremental and frequent adjustments to the portfolio.
2. The 3 C’s: Culture, Change Management and Communications: The “triple threat” of portfolio management is having all three components work in harmony to enable the strategy. Culture can be thought of as the personality and habits that an organization embodies, and although it may be difficult to describe, it can be seen and felt when walking around an organization. It’s been commonly cited that up to 97 percent of the employees in an organization don’t understand the strategy, and over 90 percent of mergers and acquisitions fail due to culture clashes.
Rather than letting culture just happen by accident, organizations should consciously build and shape the culture of the organization. And, of course, the culture must be socialized through communications and change management to not only convey the right messages and keep employees engaged, but also recognize and reward the right behaviors.
3. Governance: Good portfolio management processes ensure these core governance functions are implemented:
· Oversight: Leadership, guidance and direction. The key is being involved (through visible engagement and support in problem solving and removing barriers), not just informed (receiving status reports).
· Control: Monitoring and reporting of key performance indicators, including leading (not lagging) indicators. Too often, portfolio managers report on scope, time and budget status, however, those are all retroactive events. Although course corrections can be made, it is too late to be proactive and, as we all know, it’s easier to stop a project’s problems earlier rather than later. Leading indicators, including risk exposure, incremental value delivered and requirements volatility, are predictive.
· Integration: Alignment to strategy, as well as organizational ownership of the changes that the portfolio is implementing, should be driven by portfolio governance.
· Decision Making: While empowering teams to make day-to-day decisions, broad decisions also need executive and management support to ensure buy-in across the organization.
4. Value: The value to the organization depends on performance of the portfolio holistically, not individual components. It starts with ensuring the right programs and projects are selected. Sometimes, the focus is on an individual project’s ROI instead of the fact that although a project may have a positive return, it should be compared against competing projects’ risk, return, and alignment to strategy.
5. Risk Management: There should be a balance of the negative and positive. Mitigate threats and take advantage of opportunities. Value is ultimately the result of performance x risk/opportunity.
6. PPPM Maturity: Portfolio, program and project management (PPPM) maturity ensures the process and talent exist to deliver the programs and projects reliably. Maturity is not measured by a single dimension such as the success rate of the “triple constraint.” Instead that measure includes speed to market, customer satisfaction and strategy enablement.
7. Organizational Structure: When building an organization to enable a strategic initiative (a type of portfolio), an organization should be defined by verticals of end-to-end processes and horizontal enablers. Horizontal enablers are common support elements that span across the verticals organized by the work instead of the functional area—such as change management, reporting, training.
How do you align portfolio management with strategy? I look forward to your thoughts!
by Wanda Curlee
The Internet of Things (IoT) will change the cell phone landscape.
For many years, the smartphone has been our link to apps. We could lock our cars, play games, spy on our pets—the list is almost exhaustive.
But, I am constantly brought back to a question of whether or not smartphones will always be necessary—or will they become obsolete as more IoT devices are created that combine the hardware, software and user interface into one place.
Is this pie in the sky? Based on how our technology is rapidly progressing (which I started discussing in my last post), I don’t think so.
As Maurice McGinley, design director for Amsterdam-based AVG Innovation Labs said, “Instead of having one universal device—your smartphone—controlling your environment, you would have simple controls placed where you need them, available when you need them.”
While I have no insight into the strategic direction of the companies developing smart devices, I would contend this is the direction they will be going.
And this is great for the project management discipline.
Smartphone manufacturers and network providers (Verizon, AT&T, etc.) will need to change or broaden focus, and that means investing in new projects and programs. And the portfolio manager will need to ensure the projects and programs are on the roadmap to deliver the right value for the enterprise.
Smart device manufacturers will need to figure out how to provide a friendly user interface similar to the mobile experience.
The project management discipline would be used in a similar way as the cell phone industry. The portfolio manager should scan the enterprise for projects and programs that meet the need. If there are none or not enough to help drive the strategy, the portfolio manager needs to work with the portfolio sponsor to determine the issues. The project and program managers would deliver the capabilities needed.
So, where will you be when the industry is stood on its head? How will you help to focus the IoT to deliver the right technology for consumers and companies?
Project practitioners that truly understand their industry and where it is going can be drivers of that change.
By Jen L. Skrabak, PMP, PfMP
Most portfolio managers are aware of the importance of aligning their portfolio to the strategy of the organization.
But what exactly is strategy?
Strategy is commonly misunderstood. Sometimes it is used to denote importance or criticality, for example, a “strategic program.” Other times, it may be used to convey an action plan—an organization may say that their strategy is to launch a new key product.
In reality, however, strategy does not denote importance or complexity; rather, it represents the collective decisions that enable the organization to amplify its uniqueness in order to win.
It’s important to think of strategy as having three components:
Definition: The intent of the organization over the long term.
Plan: Clear, concise and compelling actions expressed through a strategic plan and roadmap. Visualization helps to articulate the strategy, and align it with objectives and measurements. Frameworks and tools such as a strategy map, balanced scorecard and activity map help plan the strategy.
Execution: How the organization will achieve its defined plan through its portfolios (and corresponding programs and projects). The portfolio represents the decisions that the organization has made in order to execute on the strategy.
What Strategy IS and IS NOT
The strategy should define for the organization and individuals:
-Where are we going?
-Why are we going there?
-What’s my role?
In my next post, we’ll discuss how to align portfolio management to strategy.
By Wanda Curlee
Blogger Stacey Higginbothan aptly notes that the Internet of Things (IoT) is now a part of our everyday lives and will eventually cause upheaval across the mobile industry.
As a portfolio manager, will you be at the forefront of the IoT revolution?
Over the past decade, IoT evolved from an area that only IT personnel really understood or dabbled in to something widely understood—and invested in—by organizations around the world.
Look around. Today, IoT is changing industries and the way our appliances and apps work with each other, and us.
Manufacturing plants can use a mobile app to change a light bulb’s color based on the situation. So, for example, software can monitor how many returns are received and change the light’s color once a certain number is reached. The app can also change the bulb’s color when items have to be packaged, when there’s a safety situation or when deliveries arrive.
The opportunities are only limited by the imagination—and by which information can be measured or reported by an app. Imagine: a fire alarm is pulled, and all the lights in the facility change color.
Forward-thinking companies are taking full advantage of IoT and making a business of it. You may have seen advertisements for the Amazon Echo, which has been “married” with other IoT technologies to create new applications.
What It Means for Portfolio Managers
Having read all this, can you think how a portfolio manager might benefit from the IoT explosion? If you understand the enterprise picture of your company and industry, you’re in a good position to think about IoT applications that your company can use, or an IoT need that your company might fulfill for customers.
The portfolio manager is in a great position to ask questions about how IoT can revolutionize various projects/programs within the enterprise. What about partnering with another firm that produces something entirely different? Is there an area where your industry needs to reduce cost, increase safety or be more effective?
Remember, you could ask the question that sparks the next big development in IoT.
Stay tuned for my next blog post, about how the IoT will impact the mobile industry.
By Peter Tarhanidis
Happy customers are better customers. Savvy organizations develop a customer experience strategy to make them happy, and savvy project managers understand that the customer experience should drive digital projects forward. Smart digital practices should enable a better customer experience by re-evaluating the customer value of processes and the performance of operational teams.
Here are three tips for project managers delivering digital projects tied to a customer experience strategy:
1. Align the attributes that drive customer experience across projects. Once identified, chart these attributes back to customer journey maps, processes and service level measurements, and integrate them into technology investment decisions. This will ensure funding for digital projects.
2. Automate customer experiences to simplify the journey maps. Analyze the pain points across the customer journey map. Empathize with how they interact with the channels to obtain your product or service. Hone in on the negative areas that drive the experience and create a portfolio of improvement opportunities. These improvements should have a complementary operational cost reduction. Moving away from intense labor-driven activities to automated customer self-service approaches achieves operational excellence.
3. Create a service culture in your organization. While transitioning a project into operations, train teams on providing superior customer service, recognize service representatives who model best practices, and integrate customer experience measures into performance compensation systems to drive behavior changes and reinforce the new culture.
Thankfully, technology advancements in customer relationship management have created measurement tools that make it easier than ever to understand what customers are thinking and want changed. Look to these three categories to help target improvement efforts:
Net Promoter Score defines the voice of the customer and an overall satisfaction rating.
Tools that scan social media platforms (e.g., Facebook, Twitter, Instagram) to gather brand feedback.
Channel content management tools that highlight the performance and value of various types of customer interactions—whether via email, websites, or phone, for example.
The bottom line: Let the customer experience guide the selection and execution of customer-facing digital projects—and then look for boosts to customer experience scores.