This is the third part in a short series about Management of Portfolios. Read the first part here. Read the second part here.
In the last article I looked at the portfolio definition cycle – the part of Management of Portfolios that covers putting a portfolio together and what this involves. The other management cycle is the portfolio delivery cycle, which looks at making sure that the work included in the portfolio is done correctly. That essentially means good project and programme management practices so that any new change initiative is planned and implemented effectively.
The portfolio delivery cycle includes 7 practices. These are designed to deliver the portfolio work and keep the portfolio itself up to date as things change and as lessons are learned from each of the projects, just like a conductor instructs and manages an orchestra.
Let’s look at the 7 practices in more detail.
1. Management control
It seems obvious, but it is still worth saying – management control is important! Without it, there’s no clear decision making protocols. Decisions should be made with the overarching corporate strategy in mind, and they should support the delivery strategy and the overall plan.
2. Benefits management
Benefits management is also part of programme management, and to a lesser extent, project management. At a portfolio level, it’s important to identify and manage the benefits from all the change initiatives, projects and business as usual work. You may find that your company has a benefits manager to do this.
3. Financial management
Portfolios can cost a lot of money. It’s the cumulative cost of all the projects supporting the strategic objectives, which can total hundreds of thousands, if not millions, of dollars. So strong financial management is essential. There is also a role here in making sure that the company’s financial year and management cycle ties up with the decision making about the portfolio, so that you don’t end up with lots of mid-year reporting to do at the most critical part of delivery, or end up missing the deadlines for budget submissions because you didn’t know about them.
4. Risk management
As you do risk management on projects and programmes, you also have to do it at a portfolio level. It’s the same basic approach, but at this level it looks at consolidated risk as well as individual risks to individual change initiatives.
5. Stakeholder engagement
Seeing a theme here? Yes, you have to do this for projects, programmes and portfolios. Again, it’s the same overall approach of identifying stakeholders and ensuring that they receive adequate communication and are involved at the right level. There are likely to be a lot of stakeholders, so this can be a time-consuming job, especially if you include the external stakeholders (which you should).
6. Organisational governance
Governance is another element that stretches over projects, programmes and portfolios. At this level it’s important to make sure that governance of the portfolio is aligned to the overall corporate governance approach so it all ties up. Essentially, this is all about making sure that there is transparency and clarity about decisions and data.
7. Resource management
Again, as you would expect, portfolios have dedicated resources as well as the project and programme managers delivering the change initiatives and projects. Resource management involves ensuring that there are enough people with the right skills to deliver the change in the most appropriate timescales. If you think about the number of resources involved in a portfolio this can be a lot of people, so the overhead in understand their availability and making sure that people are scheduled appropriately can be huge.
MoP provides guidance on carrying out all of these practices with the aim of getting the portfolio operational quickly and managed professionally during the lifecycle of the change initiative. As you can see, the principles overlap between projects, programmes and portfolios, although you’ll need to use different approaches at each level. Risk management, for example, is likely to be very different at a project level to a portfolio level, although the basic premise and what you are trying to achieve is quite similar.