PM Network - December 2015

Ms. Clarke-Holliman: Risk cuts across all activities and must be integrated with every aspect of portfolio management. ;e organization’s risk appetite is a critical input and needs to be considered a selection criterion for all categories. By having the enterprise PMO constantly evaluating through reporting tools and reviews, you can ensure the portfolio composition doesn’t exceed the organization’s risk tolerance at any point in time. ;e huge di;culty is canceling overly risky projects within a timely manner.

Mr. Chalouhy: Just like a project manager, the portfolio manager looks at risks—but in a di;erent way. ;e portfolio manager will not look at the usual, normal risks that a project manager or program manager looks at. Instead, a portfolio manager looks at higher-level risks—risks that will a;ect the strategy of the organization, whether that strategy has to do with ;nance, product, marketing, governance, etc.

Portfolio management clearly helps organiza-
tions manage priorities. Can it also help them
manage people?

Ms. Clarke-Holliman: At Medtronic, human resources’ strategic goals are aligned to portfolio management, which provides direction on which skill sets are needed to achieve its goals. ;ey’re tightly integrated to maximize value to achieve the organization’s vision.

Ms. Lawler: Portfolio management helps with talent management by looking at the entire job family—all the roles across an entire project—and identifying career path and development opportunities. I’m probably in a better position than anyone to look at that organizationally and work towards having consistency and opportunity across the entire organization.

Any tips for implementing portfolio management?

Mr. Mishra: Engage with senior executives to
talk about the bene;ts of implementing portfolio
management practices within the organization, and
then—with senior management buy-in—implement
it using your organization’s change management
within this screening model. So for us, portfolio man-
agement maximizes innovation ROI.

How does portfolio management help organiza-
tions manage risk?

Ms. Lawler: Risk management at the portfolio level is something that our organization hasn’t quite tackled, although it’s absolutely a journey we want to take. It’s kind of weird that we’re better at thinking about our retirement pension and how we want that mixed than we are about our organizational investment.

For instance, you don’t want a high ratio of your projects unable to deliver value for at least ;ve years. You want to make sure that you’ve got a staggered value coming back by managing that ;ow of return. You’ve got to make sure you don’t have too many long-term IT projects because that’s such a vulnerable, disruptive industry. You want to avoid having too many complex projects at once—especially if they sit under the same executive. Reducing risk by balancing organizational capacity and demand is really challenging in the nonpro;t and social service sectors, and it’s something we’re working on.