Demystifying Portfolio Management Meetings - A Conversation with Ken Dobie

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At the Resource Planning Summit in Austin, Texas late last year, one of my fellow speakers was Ken Dobie, CEO of Skyemar Consulting, a strategy and project portfolio management consulting firm. 

At the event, Ken spoke eloquently and clearly, offering a practical blueprint for a recommended cadence for strategic and portfolio planning meetings, a topic often elusive to companies trying to mature in portfolio management.

Ken and I had a chance to chat briefly and he was gracious enough to provide an interview on the subject:

JM:  Ken, your presentation at the Resource Planning Summit, sponsored by PDWare, offered a practical blueprint for corporate planning and portfolio management meetings, and I thought our readers could benefit from some of the insights.

First, as we know, companies have traditionally held annual strategic and operating planning meetings, and perhaps quarterly reviews, but the trend seems to be toward a more frequent, cascading set of meetings covering strategy, operations, resource planning, and prioritization. I know you spoke about this at the event. Could you offer a high level view of what collection of meetings you feel is the "sweet spot" and what the cadence should be?

KD: Yes, I believe an optimal corporate planning process should include three distinct yet linked objectives. 

The first is an annual strategic planning process involving senior management to develop high-level priorities, all things considered, articulated in a strategic plan document. 

Second, tactical priorities from the strategic plan are translated into corporate goals aligned with the top goals of senior management and cascaded throughout the organization. These goals are prepared on an annual basis and reviewed quarterly at an appropriate high-level business review forum. 

Third, new product development roadmaps should be drafted on an annual basis aligned to overall corporate strategy, while prioritization and allocation of resources should be managed quarterly in a dedicated high-level forum. Depending on the size and complexity of the product development pipeline, monthly portfolio reviews provide the opportunity for more granular management of issues that inevitably arise.

The capabilities outlined above is a lot, but it can be developed and implemented in a modular fashion, assuming first and foremost that senior management is bought into the value and ready to invest the necessary time and resources.

JM:  So we're talking annual strategic and product roadmap planning; tactical operational planning tied to the overall goals; quarterly prioritization and resource allocation; and monthly portfolio reviews. I've even seen companies hold granular reviews bi-weekly to address exceptions. Of course, people sometimes complain that the portfolio review meetings feel like "groundhog day," where they revisit the same list of projects and issues at every meeting, but that's another story we can talk about later. First, do you have any recommendations as to the most efficient way to run the quarterly portfolio review meetings?  

KD: Quarterly portfolio reviews should be limited to presentation of ongoing projects that warrant discussion and new projects awaiting prioritization in the coming quarter. Avoid any general updates on projects that are running fine and don’t warrant discussion – this just wastes time and dilutes the focus. This way everything is fresh and pertinent. 

JM: It takes quite bit just to keep that focus on prioritization and resources. People are tempted to throw everything but the kitchen sink into those meetings.

KD: They need to avoid that. A quarterly portfolio management meeting tasked with prioritization and resource allocation is challenging enough, often involving extensive (and sometimes passionate) debate and requires considerable pre-work to prepare. These quarterly meetings can take 2-plus hours as it is, involving heavy hitters throughout the organization, dependent of course on the company and portfolio size. I always recommend that these quarterly meetings be limited to the topic of prioritization and resource allocation - that in itself is huge. 

JM: Absolutely. What about the flow of the meeting? Do you see any best practices?

KD: The quarterly meetings should ideally begin with an overview of the total portfolio status from a centralized function, with an emphasis on the total resource supply/demand model. This can be followed by each business area presenting:

(1) a summary of their current project priorities based on a set of metrics, and

(2) their subset of the projects [ongoing and new] warranting discussion. 

The last part of the meeting should involve some form of dynamic portfolio modelling based on project priorities and resource allocation to arrive at a balanced resource supply/demand scenario. This will involve some projects being prioritized, with others receiving less resources or deferred until resources become available. A successful outcome of these quarterly reviews is agreement on priorities with sustainable resource allocation.    

JM: This makes good sense, especially limiting discussion to items needing decisions and new projects awaiting prioritization in the context of the overall portfolio. And unless you have the big picture of the whole supply/demand model, it's hard to make on-the-spot decisions. I'm glad you mentioned including all businesses areas, so tradeoffs can be discussed right there as needed. 

KD: Absolutely. That's exactly the purpose of the quarterly reviews, along with resource allocation. Usually, an organization's development pipeline comprises projects from more than one business area. It’s up to each business area to prioritize their own projects which is coordinated via an annual portfolio road-map planning process. And usually an organization has some or mostly shared resources across business areas. Hence, a quarterly portfolio prioritization and resource allocation forum is necessary to prioritize projects within and across business areas and to manage the allocation of resources.   

JM: These meetings can get quite contentious.

KD: Yes they can. When it comes to the quarterly meetings where resource constraints usually have to be managed across business areas, each GM can make their case for their respective projects and priorities. But this forum is where corporate priorities are set, so business areas might have their priorities adjusted (though it's not all that common). More likely, they won't get as many projects into the pipeline as they'd wish due to competing forces.

JM: I think organizations have to realize that capacity is always finite, aside from minor staff augmentation, so what they really have to focus on is demand prioritization, which is often a hard pill to swallow. 

Okay, so we talked  about the quarterly meetings. Where do you find the monthly reviews most useful? How would you say they differ from the quarterly meetings, for instance?

KD: Monthly portfolio review meetings are useful for organizations with a large and complex development pipeline. While the purpose of the quarterly reviews is focused on project prioritization [within and across business areas] and resource allocation, monthly reviews provide a forum for more granular management of project-specific issues like: 

  • Is the project getting sufficient resources to meet specifications or timeline?
  • Are there technical challenges warranting discussion?
  • Is the schedule on track?
  • Is the program within budget or has the revenue forecast changed?
  • Is the commercial organization ready for launch? 

The monthly portfolio meetings are also useful for certain housekeeping activities, like making business area leads speak to any new projects that may have been created, identifying projects overdue for a phase exit review, projects that are overdue to exit the development pipeline, and review of action items from the previous monthly meeting. 

While the monthly reviews help manage the portfolio, this process is separate from core project-specific deep dive phase-gate reviews that can occur weekly for projects in the pipeline ready for phase exit review. So, quarterly, monthly and weekly forums have different purposes.

JM: So you're saying they're more tactical and exception-based, zeroing in on project issues for crucial projects, which may also include resource issues. That jives with what I've seen as well, though I do see a trend toward doing interim prioritization and resource allocation adjustments at the monthly meetings as well, or even biweekly as I mentioned, but it depends on the size and complexity of the organization. I think the key here in any case is not to get bogged down in project details. For that, there are the project and program steering meetings and gate reviews, like you mention, which may surface resource issues of their own. 

KD: Yes, and in many cases it can take up to an hour just to run a stage gate or steering meeting well and involves a deep dive into the core team's diligence and many aspects of project (and even product) management. Often resource and other issues do arise, and these can be either handled or represented as needed in the next portfolio review. 

JM: So either way, there's an element of stage gate meeting decisions that may get deferred to the portfolio review meetings, but it's exception-based. A complaint I often hear is that waiting for the next review causes delays.

KD: A counter argument is that it may indeed cause delays, but in reality the people sitting at the table for a project phase exit review are often the same people at the quarterly portfolio review. So, some decisions can be made at the stage gate meeting, but others would need to wait for the portfolio review.

JM: That sounds like a practical approach. Okay, so we've talked about the annual, quarterly, and monthly meetings and how they differ. Now let's talk tactics for a minute regarding the quarterly prioritization reviews, realizing that there may also be mid-cycle priority adjustments as needed. In any case, when it comes to prioritizing projects, do you recommend ranking 1-n every project in the portfolio, or do you feel it's better to have banded priorities and only go to the sequential 1-n level for a targeted group (maybe the top ten or where there are conflicts)? I've seen cases made for both, but the latter has always seemed more efficient in most instances.

KD: It depends on the number of projects. For example, if there were just 5 - 10 projects then I think a group of executives would have a reasonable chance at agreeing on a granular prioritized list. However, if there are more than 10 projects, granular prioritization will become more challenging. Instead, I’ve found it extremely useful to divide the development pipeline into 4 levels of priority. 

The first are the top projects that everyone agrees must get done and warrant allocation of the resources they need to meet project specifications and the development timeline. These are projects with significant forecasted revenue and/or impact on execution of the organization's mission. 

The second group are projects that are considered very important, but, in a crunch, they may experience some resource tradeoffs in favor of projects in the top tier. 

The third tier are lower priority projects in which any delay will not have as much of an effect on the execution of the overall corporate strategy and therefore there is more flexibility in the development timeline. 

The fourth tier are projects that may get deferred or delayed if resources are limited. 

The four definitions above are illustrative and can be tailored to an organization’s preference – the main point is that some form of bucketing into project priority groups is very useful for functional managers to prioritize their resources appropriately.

In summary, for a business area with a few projects, granular prioritization is appropriate to justify resources. At the portfolio level, where multiple business areas and shared resources are involved, a tiered approach works well.  

JM: Ken, thanks. That's a pragmatic model to follow and allows focusing on groups of priorities strategically, and more granular prioritization where needed. Any last words of advice?

KD: For those new to this, they should keep in mind that it may seem overwhelming with respect to layers and nuance, but Rome wasn't built in a day, and what I'm describing are processes developed and refined over years that can scale to support a multi-billion dollar organization comprising multiple business areas. For anyone taking this on I recommend a modular approach addressing the low hanging fruit first. 

When done well, these processes add tremendous value to an organization's ability to execute and can be a competitive advantage. Given the investment of time needed to design and implement the above, and the value of getting an effective portfolio management process in place, I also recommend employing some experienced outside council to help catalyze and implement any necessary evolution.

JM: That's sound advice for sure, keeping things simple and maturing from there, and of course having experienced guidance. I think a key takeaway here is that continuous planning, while important, isn't about repeating the same process more frequently. It's about adopting a proper cadence, with each tier having a defined purpose, and having each tier work in an integrated fashion.

KD: Yes, that's exactly the point. 

JM: Ken, this has been extremely enlightening, as I knew it would be. I appreciate your time. I think this will bring great value to our readers, as it's a perennial topic of interest.

KD: You're quite welcome.

For information on how PDWare's ResourceFirst software supports the portfolio planning cycle, click HERE.


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Jerry Manas is the bestselling author of The Resource Management and Capacity Planning Handbook, Napoleon on Project Management, and more. At PDWare, Jerry helps clients improve strategy execution through tools and processes that align people and work with organizational priorities. Connect with Jerry on Twitter and LinkedIn