Portfolio Management Working Meetings Reviews and the Black Book

To recap a bit, we prepare and review the project data sheets for current and potential programs. These sheets cover all types of programs along the innovation pipeline. Snapshot forms are completed for programs that are currently funded or stand a reasonable chance of being funded. All projects are rated using the anchored scales. Programs rated a 5 ("most urgent") are resourced first. If resources still remain, then programs rated a 4 ("urgent") are resourced. Typically, we exhaust our resources at this point. This is the "Initial Portfolio Assigned" step in Figure 9.1-3. The programs already funded in this step, as well as the remaining other programs with enough available data, are evaluated in detail in terms of a financial analysis. The financial analysis is performed in the form of an expected commercial value calculation. High-level project plans are created for proposed programs, including resource needs and critical milestones. These are the elements that help the business team determine the "Strawman Business-Adjusted Portfolio" refered to in Figure 9.1-3. The most urgent programs are resourced, but the pipeline is also balanced for short- and long-term programs, short-and long-term financial impact, and strategic intent. This portfolio is the one that we take to the full-day working portfolio meeting. It is there that we review what is currently in the portfolio and what we are not funding and discuss where we need to be to meet our business strategy. The result at the end of the day is a risk- and resource-adjusted portfolio that is formed by comparing the risk in the portfolio to business standards and availability of resources. Several alternative portfolios are evaluted and adjustments are made until there is consensus in the resulting innovation pipeline portfolio. The last step is an executive review of the resulting risk- and resources-adjusted business technology portfolio.

Disciplined portfolio management can be difficult to maintain long term. It requires time up-front planning for what might be rather than what is. Portfolio management meetings include the elements of data collection, data analysis, and data management. Portfolio management (1) provides decisions on the collection of projects, (2) identifies urgent must-do projects, (3) seeks pipeline management, (3) seeks portfolio management, (4) feeds the Stage-Gate process, and (5) identifies critical must-do or next steps in individual programs and ideas.

The end result of our portfolio review and portfolio management working meetings that occur twice a year is known as the PM Black Book (so-called because the results, while available online, are also contained in a black three-ring binder that each member of the team receives a copy of for reference). The contents of the PM Black Book is shown in Exhibit 9.1-3.

The team knows where to locate information in the black books, and each member of the team has a favorite section that he or she tends to refer to for information on specific programs. Prior to the working portfolio meeting, a draft of this notebook is distributed to each of the members of the business team. Each member reviews the book prior to the meeting, thus allowing the team to discuss issues and plan for the future rather than reviewing data. The whole business team contributes to the information contained in the notebook and is held accountable for the information's accuracy.

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Project Management Made Easy

Project Management Made Easy

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.

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