Is the portfolio a key concept in management?

Projects are piling up at your company. Obligations, good ideas, innovations, improvements, etc. are all to blame. Ten, twenty, a hundred, a thousand: project portfolios (unlike their leather namesakes) generally have more entries than exits. So a minimum of organization of this flow is essential.

Before you rush into structuring, ask yourself why you need a portfolio in the first place. This article presents three main reasons.

Acquire the keys to strategic analysis

You have to ask yourself the right questions:

• Coherence of my projects: Am I preparing sufficiently for the future? Am I sufficiently consolidating what I've learned? Do I have too many long-term projects?
• Coverage of my projects: Am I missing any part of my strategy? Will I meet all my obligations?

Grouping projects into manageable entities

You need to find the consistency between your governance and your portfolios. Your governance rules must be translated into these portfolios. For example, put a project in the "red project" portfolio if the budget overrun exceeds 40%.

But also consistency between your steering bodies and your portfolios. Project-dedicated bodies need to be supplied with information (management review, strategic review, etc.).

Read also: How to choose the right type of portfolio?

Creating clarity

Themanagement team needs to be able to read the project. They need to be alerted and informed in order to make decisions without the information being drowned out by the mass.

Operational staff, for their part, need to understand the context of the project and the scope of the actions carried out.

Summary

In conclusion, to define your project portfolios, you need to base them on the three points mentioned above. But also on the project fundamentals:

• Importance (vital, key, important, optional, etc.)
• Strategic nature (project for the future, consolidation, obligation, etc.)
• The theme (business lines)
• The "project product" customer (from the organization chart)
• Complexity (scale ranging from simple and mastered to new and delicate)
• Cost (e.g. price brackets based on project manager autonomy)
• Duration (long-term projects, fast-track projects, etc.)

Then on economic parameters:

• Projects behind schedule, at risk or over budget
• Project status (to be launched, in progress, on stand-by, completed, etc.)
• Dependency projects

All these keys can also be applied to a hierarchical vision. This is natural for organization-based portfolios, but applicable to levels of delay.

To conclude this reflection on structuring, we also need to think about portfolio intersections. Without going into the subtleties of set theory, let's talk about intersections such as "strategic axis/complexity", "overdue projects/customer" or "duration/theme".

All these analysis keys are there to help decision-making throughout the life cycle:

• Preliminary project to fuel strategic thinking
• Project launch and go/no-go process
• Project follow-up and the need for inter-project arbitration
• Closing projects and the possibility of launching new ones