Having a portfolio management approach in place seems to be more important than the details of which tools and metrics one chooses. Any portfolio system seems to be better than no system at all. The research shows clearly that businesses that feature a systematic portfolio management process, regardless of the specific approach, outperform the rest (Figure 7.2-10).20 Top-performing businesses in product development have implemented a systematic portfolio
Figure 7.2-10 Impact of Portfolio Management Practices on Performance
Formal and systematic portfolio management process in place
Projects are aligned with business's strategy
Resource breakdown reflects business's strategy
Portfolio contains high value-to-the-business projects
Good job of ranking/prioritizing projects
Portfolio has excellent balance in project types
Good balance between number of projects and resources
I I Worst Performers I I Average Business I I Best Performers
Percentage of Businesses Where Each Portfolio Management Practice is in Place
Reads: 21.2% of businesses have a systematic portfolio management process in place (meaning that 79% do not!). Best performers are better here, with 31.0% having such a system, while only 3.8% of poor performers do.
Sources: Cooper, Edgett, and Kleinschmidt, Best Practices in Product Development, and Cooper, Edgett, and Kleinschmidt, New Product Development Best Practices Study.
management approach; they have achieved strategic alignment of projects with their innovation strategy; they prioritize and rank their projects effectively so that their portfolios contain high value-to-the-corporation projects; and they seek and achieve the right balance and mix of projects. Portfolio management pays off.
Robert G. Cooper is professor of marketing at the School of Business, McMaster University in Ontario, Canada, and ISBM Distinguished Research Fellow at Penn State University's Smeal College of Business Administration. He is the father and developer of the Stage-GateTM process, now widely used around the world to drive new products to market. He is a prolific researcher and thought leader in the field of product innovation management, with more than ninety articles in leading journals on new product management and six books.
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What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.