Digital transformation is creating unstable and complex business environments. As a result, traditional companies that want to continue to satisfy and exceed their client’s expectations need to work hard.
They need to respond to change with speed and agility. In particular, if they want to succeed in today’s business climate, they must become more adaptive at the operational level and more agile at the strategic level.
Agility means being able to be proactive in sensing changes and responding with speed, innovation, and competence to fulfill and surpass customers’ expectations (e.g., Sambamurthy et al., 2003).
Companies can start by creating self-organizing cross-functional teams that, thanks to short cycles, are able to deliver improvement and innovation.
At the same time, companies also need to rethink project portfolio management practices.
Multiple methodologies within the same portfolio
Before sharing the actions that companies need to take to continue to satisfy and exceed client’s expectations, it is important to clarify that contrary to many opinions, agile and waterfall projects can stay together within the same project portfolio. In fact, both types of projects can create a balanced approach to Project Portfolio Management (PPM).
Basically, it does not matter how companies manage their portfolio of projects, the most important thing is that they bring all materials and data about projects such as documents, tickets, and so on together into portfolios.
Once companies have created their one single source of truth (SSOT), which helps them aggregate the data from many systems within an organization to a single location, they can make sense of what is happening at the portfolio level. As a result, they will be able to help their teams to manage risk better and respond rapidly to the requests of strategic change.
Finally, it is extremely important that companies that want to change need to act in ways that allow their culture to accept it. What often happens is that the implementation of change fails because companies are not able to handle the change properly.
Changing Project Portfolio Management
The request for agility imposes also changes for portfolio management and governance. Some companies report that they have been able to apply some agile principles at the portfolio level.
Agile portfolio management helps companies manage all kinds of project types and portfolios thanks to agile processes and workflows. In addition, agile portfolio management can be used to manage both products and projects.
Agile portfolio management is characterized by decentralized control and flexible plans that allow companies to embrace uncertainty. Methodologies and approaches such as Scaled Agile Framework and Disciplined Agile provide companies with inflexible solutions which may not suit every organization.
At the same time, there are other approaches that are characterized by more flexibility and provide insights into specific agile portfolio tasks like continuous portfolio planning (Suomalainen et al., 2015).
Finally, it is also important to share that first approaches such as Hoffmann and his colleagues proposed general design principles but did not consider agility’s systemic and proactive nature (Hoffmann, et al., 2017).
Keep in mind
Companies that want to continue to satisfy and exceed their client’s expectations need to change and adapt their existing project and portfolio practices and processes.
Methodologies such as Scaled Agile Framework and Disciplined Agile provide companies with inflexible solutions. At the same time, there are also some approaches that are more flexible such as continuous portfolio planning.
To support agile portfolio management, companies need to focus on maintaining transparency, continuously experimenting to find out if a project is valuable, and aligning strategy with execution.
Francesco Pecoraro, PMP, PSM, PSPO, SSYB, SSGB, SSBB, CL, CC is the founder of francescopecoraro.com where he shares useful and practical information about project management, program management, project portfolio management, and agile methodology. Francesco has extensive experience as a project, program and portfolio manager, project management officer (PMO), digital transformation and strategic consultant. He is also considered a communication, public speaking, and leadership expert. Francesco writes about project methodologies, program, and portfolio management.