Improving portfolio management must be part of an agile transformation

When we think of an agile transformation, improving portfolio management might not be high on the organization’s list of priorities.

But what happens if your organization doesn’t have an effective and efficient portfolio management capability?

There is a greater likelihood of having too many active projects which increases the risk of resource shortages. Instead of having a dedicated team of primary roles for a project, most team members will be multitasking between multiple projects. This makes it impossible to accurately estimate capacity during iteration planning and usually contributes to a team missing their iteration commitments resulting in delivery delays. Multitasking also increases the effort to have a consistent understanding of the product and can impact quality as team members might be delivering based on stale knowledge.

If multitasking is not a concern, stealth or low value pet projects might be consuming resource capacity which is required to effective staff more strategic projects. This will cause delays to these projects.

Finally, for secondary non-dedicated roles which are needed to contribute to specific work items only, a lack of visibility into when they are becoming available will be a further source of delay.

If governance committees aren’t selecting the right projects which are in alignment with strategic objectives, and only kicking off as many projects as can be effectively staffed, it won’t matter how efficient, empowering or customer-centric the organization’s delivery practices are. In addition, if the existing portfolio governance practices are inefficient and onerous, by the time a team has finally received funding approval to get started with delivery, they might have insufficient time left to deliver even minimal value to exploit a market opportunity or to meet a regulatory deadline.

Portfolio plans are useless, portfolio planning is indispensable.

Rather than having business executives, finance analysts and PMO staff spending weeks coming up with the perfect roster of projects for the next year only to realize a month or two into the year that their plans have been disrupted by domino effect delays, new priorities or resource shortfalls, portfolio planning needs to be an ongoing activity. To enable this, a lean but effective resource capacity management capability also needs to be in place to ensure that portfolio decisions are being made based on a current and accurate understanding of resource availability.

Agile delivery is not a silver bullet.