Establishing the Management Environment
As we said in our Introduction, portfolio management is a business process that requires a set of detailed processes to be conducted in an interrelated continuous sequence. It presumes that the organization has a strategic plan, along with customary mission and vision statements, together with strategic goals and objectives. The organization's strategic plan, and the benefits that are intended to flow from it, provides the decision base for the portfolio management effort and the determining factors that will make the portfolio unique.
For portfolio management to be successfully implemented, the following conditions must also exist:
- The management of the organization embraces the concepts of portfolio management
- A number of projects, programs and other related work exist
- Appropriately skilled staff is available to manage the portfolio
- Relevant project management processes exist
- Organizational roles and responsibilities exist
- Effective communications exist throughout the organization impacted to convey business decisions and receive feedback
To craft the best arrangement of the portfolio management process in your organization, you must:
- Examine your organization to see how and where it would best fit
- Understand the organization's strategic plan
- Establish the determining factors for managing the portfolio, including available capacity
- Consider all of the potential and actual projects, programs and other related work that will be encompassed within the portfolio area
- Adhere to a set of agreed-upon processes, and
- Apply them with a degree of rigor only to the extent necessary for the portfolio to be effective and efficient
- Establish Key Performance Indicators to enable "continuous improvement"
Although some changes may be obvious and necessary, it is probably best to start with minimum disruption to existing operations.