#1: Concentrate on Just a Few Things:
Apply this principle both at portfolio level and at project level.
- At the portfolio level, focus on the most important and valuable projects. Avoid “planned overload” at all costs, as it widens the gap between plan and execution.
- At the project level, plan and monitor a few key data points, including expected benefits or revenue, important schedules and deliverables, and the required cost-, resource- and skill-requirements at monthly basis.
#2: Manage projects and portfolios using simple key performance indicators. Right from the start.
Steer your project portfolio from the outset using simple key performance indicators derived from the above mentioned key project data (see Principle #1). Check these regularly:
- Impending schedule, total cost and revenue/benefit deviations in projects
- Impending resources and skill bottlenecks in the portfolio
- Deviation in expected profit/loss in the portfolio
If possible, have these key performance indicators calculated automatically. It is important that you use key performance indicators to manage your business right from the start.
Because you can only improve what you can measure!
#3: Start Quickly, Improve Continuously:
By ‘Start Quickly‘ we mean: Begin building a comprehensive overview of your entire portfolio within a maximum of 2-4 weeks.
- Create a comprehensive list of people’s capacity available for project work.
Ask your department managers who in the department can contribute how many hours of project work per month? What skills do these people have? - Create a list of all current projects.
Ask each project manager to describe the key data of their project(s): Start and end, required resources and skills needed per month, most important milestones and deliverables, expected benefit and revenue. Normally they can do this within 30 minutes per project. - With an appropriate tool, capture the total capacity available and the project key data into an appropriate tool.
Now visualize your current multi-project landscape, project key performance indicators (KPIs), portfolio utilization, resource bottlenecks, and the portfolio’s profit/loss.
By ‘Improve Continously‘ we mean regularly performing these two steps:
- Review your KPIs from Principle #2, for example, every four weeks.
- Based on this, quickly implement measures and review the KPIs again in the next review cycle.
Do this, even if you suspect many deficiencies in the current planning and setup of the projects!
Do not wait until your company or department is ‘well-prepared’ for Lean Portfolio Management. That is not efficient. You will lose time unnecessarily.
Get started, even if the current state is not perfect.
#4: Visualize Projects and Portfolio for Common Understanding:
Ensure that all project participants, from steering committee members to project managers and all project staff, have a common understanding of the key data of projects and current portfolio.
Provide all stakeholders and employees with an overview of the entire portfolio and a shared understanding of the key data and KPI’s of the projects. Limit viewing rights only when absolutely necessary.
Minimize access barriers – ideally, everyone should be able to access the data through a simple web browser.
Visualizing the key data of projects and current portfolio creates clarity about the common goals and the current project status. Visualization supports rapid, decentralized decision-making in cross-functional and cross-departmental teams.
#5: Practice Trust and Commitment:
Trust the project management and the team to adhere to the initially agreed key data mentioned above.
Avoid micromanagement at all costs:
In today’s world, it makes little sense to monitor the schedules, sequence and number of detailed tasks. Our experience even suggests that it is counterproductive.
You have your project management and team specifically to respond well and creatively to unforeseen situations – even if the schedules, sequence or number of detailed tasks changes.
As long as the essential key data from Principle #1 are not at risk, don’t require your project manager to ask for consultation or even permission. This saves an enormous amount of time at both the team and management levels.
Of course, all project managers should derive their individual detailed plan from the key data. This is the responsibility of the project management and the team. Provide your employees with assistance, but also the greatest possible freedom to develop this detailed plan with a suitable tool.
In return, regularly obtain the explicit commitment from the project management that the expected key data will be met.
Offer support if this commitment can no longer be given in good conscience by the project management.
Avoid a culture of “melon reporting” (green on the outside, red on the inside) by not punishing honest reporting of difficulties.
#6: Use Modern IT Technologies such as Cloud and AI.
Utilize modern IT technology such as cloud computing and artificial intelligence, along with the associated advantages in speed and potential for savings.
Such solutions help to accelerate processes and dramatically reduce efforts in project portfolio management.
Examples include complex and time-consuming tasks like regular reporting, managing team allocations in large multi-project scenarios, and suggestions for optimally managing project intake without overloading.
If you are using an AI-supported system, ensure that decisions are made in an explainable and understandable manner.
Be cautious of monopolistic dependencies and the quest for an ‘All-in-One’ system. This can easily lead to multi-million-dollar IT projects spanning years.
We recommend distinguishing between detailed planning tools and high-level portfolio management tools.
You need one high-level portfolio management system for all projects and initiatives you wish to carry out with your current organization.
Depending on the requirements from your departments or clients, you should provide suitable project planning tools for detailed planning, such as Open Project, MS Project, Jira, etc.
Use the actual requirements of the respective area as a guide. Even Excel can be a sufficient detailed planning tool for some areas.
