2. The Problem: We’re Stuck
• Technology and globalization keep
changing the game
– Extraordinary opportunities, each also a threat
• We must engage with these new
growth opportunities
– But face massive internal resistance to
reallocating resources
• Year in, year out, we end up with the
same old portfolio
– Nothing new ever achieves materiality—we are
well and truly stuck
• How can we achieve escape velocity?
– How do we free ourselves from the pull of the
past?
3. Living in ―VUCA‖ Times
http://www.zeislerassociates.com/VUCA.html
4. Success Factors in VUCA World
• Always retain a clear vision against which judgements can be made, with agility
to flex and respond appropriately to rapidly unfolding situations.
• Provide clear direction and consistent messaging against a backdrop of
continually shifting priorities, supported with the use of new virtual modes of
communication where necessary.
• Anticipate risks but don’t invest too much time in long-term strategic plans.
Don’t automatically rely on past solutions and instead place increased value on
new, temporary solutions, in response to such an unpredictable climate.
• Think big picture. Make decisions based as much on intuition as analysis.
• Be curious. Uncertain times bring opportunities for bold moves. Seize the chance to
innovate.
• Encourage networks rather than hierarchies – as we reach new levels of
interconnection and interdependency collaboration yields more than competition.
• Leverage diversity – as our networks of stakeholders increase in complexity and
size, be sure to draw on the multiple points of view and experience they offer. Doing
so will help you expect the unexpected.
• Never lose focus on employee engagement. Provide strategic direction, whilst
allowing people the freedom they need to innovate new processes, products and
services.
• Get used to being uncomfortable. Resist the temptation to cling on to
outdated, inadequate processes and behaviours. Take leaps of faith and enjoy the
adventure.
http://www.impactinternational.com/blog/2012/01/leadership-vuca-world
5. PMI’s Pulse of the Profession 2012 – Focus
Areas
• Organizations will renew their focus on talent development as
they look to grow and gain competitive advantage in new
markets.
• Tight economic conditions will continue to force the issue of
good project portfolio management.
• As organizations continue to strive for agility in order to leverage
ever-shifting market conditions, change management and
project risk management will become even more important
core competencies.
• The desire for organizational agility will also lead to increased
use of iterative/incremental project management methods such
as agile and extreme.
• Despite tight economic conditions, organizations have been and
will continue to increase their focus on benefits realization (in
addition to cost and time) as a project and program success
metric
7. Key issues around PfM
• Prioritization
– Risk vs. Reward
• Planning horizon
– Short-term vs. Long-term
• Resource allocation
– All eggs in a basket vs. Peanut-butter spread
• Manage Portfolio Value
– Feedback, review and rebalancing
9. Managing a Portfolio
The Three Horizons Model
High Growth
Businesses
Today’s revenue
growth +
Horizon 3
tomorrow’s
Accumulated Total Returns
36 to 72 months
cash flow
Current
Businesses
Horizon 2 Growth Options
Generate 12 to 36 months
today’s cash Options on
flow future
high-growth
businesses
Horizon 1
0 to 12 months
Expected Window of Returns
Figure 2.4
12. Revenue Profits Growth Consumers
All woods behind one arrow!
13. How often do you review Portfolio?
http://www.patentpracticeliability.com/uploads/image/too%20late(4).jpg
14.
15.
16.
17. To conclude…
―VUCA‖ is the new normal. Darwin at serious work!
Yesterday was more about Production and Operations.
Today is more about Creativity and Design
Don’t put all your woods behind one arrow. Spread your
bets intelligently
Rapid learning cycles and an ability to iterate fast are non-
negotiable.
Constantly review and rebalance your portfolio before it’s
―too late‖
PMI defines Portfolio Management as the "coordinated management of one or more portfolios to achieve organizational strategies and objectives." In the past, organisations had the luxury to do medium- to long-term strategic planning, and manage portfolio in a more systematic manner with long ROI cycles. However, in today's world, several factors like fast technology adoption rates, globalization, lower entry barriers for newer players, rapid large-impact changes in global financial markets and others, combine to create highly dynamic environment where such long-term portfolio management strategies might not be most effective. In this session, we examine how could organizations adapt the basic principles of portfolio management in dynamic environments and improve its effectiveness.
Industrial ManufacturingRepetitive, optimize components, high reconfiguration costsWaterfall methodHigh costs of developmentRational Unified Process (RUP)High costs of change late in cycleCapability Maturity Model (CMM, CMMI)Typically based on a waterfall methodFixed-price contractsVendor control and accountability