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Portfolio Management Breakthroughs
Shelley Gaddie
President
Project Corps
Pacific Northwest Portfolio Management Roundtable
November 07, 2006
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Strategy
EnterpriseGovernance
Initiate
Analyze
Design
Strategy
Goals
ObjectivesInternal Assessment
ExternalAssessment
Initiatives
Approval
Prioritization
Lessons Learned
ProjectDelivery
Business Case
Programs & Projects
Ongoing MetricsAnalysis
Build
Validate
Implement
A continual flow ofplanning and executionprocesses that supportongoing:
shifts for customer and marketplace driven changes.
analysis of progress against goals and objectives.
incorporation of improvements based upon lessons learned.
The Enterprise Framework
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In Theory it’s Simple but…
EnterpriseGovernance
Strategy
Project Delivery
…executive planning processes oftenstop short of providing the clarityrequired to execute effectively.
Portfolio Management
Program Management
Project Management
… program management organizations build project tracking systems rather than management decision making support systems.
…project teams focus on timely, onbudget delivery at the expense of market and customer priorities, quality and outcomes.
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ALIGNMENT: Support of the organization’s strategic direction.
VALUE: Return on investment and long-term benefit for the organization.
ACHIEVABILITY: Capacity to deliver successfully.
BALANCE: Diversification across multiple dimensions and competing priorities.
The Principles
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Three Companies
Financial Services Dramatic growth by acquisition; Redundant systems and services; Bureaucratic and risk averse; Declining margins in core business; and Must make immediate improvements in
financial performance or face take-over.
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Three Cultures
Financial Services Focus on Mission
Performance Results Bottom Line
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Telecommunications New market (Eastern Europe) start-up; #3 against top two global contenders; Young leadership and staff; Customer and innovation focused; and Goal to grow to #1 in three years.
Three Companies
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Three Cultures
Telecommunications Focus on Involvement and Adaptability
Team Creativity Risk
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Insurance Strong brand; Declining membership; Growth by merger resulting in divergent
processes and systems; Aging technology infrastructure; and New leadership with strong
transformational vision.
Three Companies
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Three Cultures
Insurance Focus on Consistency
Leadership Processes Systems
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Three Questions
Insurance asked HOW? Focus on effective structures, processes and systems
for portfolio management, take iterative steps and establish and work toward long term results.
Telecommunications asked WHO and WHAT? Support shared ownership and development, apply a
market focus in portfolio definition and management and deliver customer targeted results.
Financial Services asked WHY? Build a direct relationship to the primary business
problem, define the value statement for portfolio management in relationship to the bottom line and deliver immediate results.
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Why?
Capture the bottom line
impact
Analyze, Document, Vet, Educate and Communicate Build the business case for portfolio management in
alignment with current strategies, goals and objectives. Define standard terminology, minimize jargon. Obtain executive ownership. Enroll and educate key staff in the concept. Communicate the vision, framework, plan and financial
targets.
A Burning Platform
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Why? Who?
Engage key leadership
across multiple
functions
Capture the bottom line
impact
Engage, Focus, Plan, Transfer Ownership and Prioritize Establish an advisory body that owns the portfolio
management plan. Identify and prioritize portfolio management challenges. Develop a simple and iterative solution roadmap. Establish a governing body that defines and oversees the
portfolio. Identify and prioritize the key enterprise-wide initiatives.
It’s Up to Us
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Why? What?Who?
Engage key leadership
across multiple
functions
Market demands
balanced by company capacity
Research, Understand Capacity, Benchmark, Develop Metrics Support portfolio management with market research. Design the solution based upon industry best practice
and organizational readiness. Measure results of the process and system with
customers and against past performance and the industry.
and
Capture the bottom line
impact
We’re the Experts
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Why? What? How?Who?
Simplify and maintain the integrity of
processes and data
The Devil’s in the Detail
Promote, Define Roles, Establish Value, Prototype Promote portfolio management at the executive and staff
levels Define benefit of and leadership and staff roles and
responsibilities for practices and processes. Focus on reporting and providing meaningful information. Design value added processes and tools. Prototype.
and
Capture the bottom line
impact
Engage key leadership
across multiple
functions
Market demands
balanced by company capacity
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Three Breakthroughs
Telecommunications The right PEOPLE engaged in the right way for
the right reasons.
Insurance A new way of doing business built with attention
to DETAIL from the bottom up.
Financial Services A VALUE proposition with immediate bottom line
impact.
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Finance - Value
A strategic alliance between the corporate PMO and Finance, Internal Audit and Risk Management.
Bottom line relative results oriented 3-year business case based upon past three years project data.
Small, centralized, directive executive level governance.
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Finance - Differentiators
1. Neither PMO led or exclusive.
2. A business case built with cross functional participation and based upon real organizational experience.
3. Addressed the burning platform.
4. An executive team ready to make hard decisions.
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Telecommunications - Engagement
A strategic alliance between Strategic Planning and Sales and Marketing.
Business planning aligned with corporate strategies, key financial targets and key performance indicators.
Large broad based multi-level collaborative governance.
Market, customer and industry focus.
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Telecommunications - Differentiators
1. Positioned as support for annual planning.
2. Engaged widespread participation in first advisory and then governing roles.
3. Established priorities exclusive of capacity.
4. Market, customer and industry feedback and metrics.
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Insurance - Leadership
A strategic alliance between units of the EPMO, executive leadership, Strategic Planning, Change Management and IT.
An EPMO and IT plan and project focused on designing, building and testing a prototype system.
Centrally coordinated parallel tracks of developmental work.
Transformation focused.
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Insurance - Differentiators
1. Iterative strategic development steps implemented over time.
2. Multiple service department sponsorship.
3. A prototype with test and refinement time.
4. Introduced as a transformation delivery and measurement system.
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Conclusion
Alignment Value Achievability Balance Values and Culture
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Summation
Three unique approaches. Three similar results.
Number of projects ▼ Reduced by an average 37%.
Project on-time delivery ▲ Increased by an average 20% in first two years.
Project on-budget delivery ▲ Increased by an average 38% over three years.
Portfolio management is here to stay.
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