Portfolio Resource Management

Portfolio resource management includes the processes that allow an organization to assign the appropriate resources and quantities (skilled labor, non-labor services and materials) effectively to execute the projects in its portfolio successfully.

Resource management helps to ensure that the organization’s resources are allocated properly to meet business needs and provides management with information for forecasting future resource requirements. Subcomponents are:

Resource Assignment Process

Resource assignment processes optimize the matching of needs to capacity to obtain the highest value by assigning the most appropriate resources.

Skills Identification and Asset Inventory

Skills and asset inventories are necessary to optimize resource allocation. Correct categorization of skills and assets is necessary for accurate depiction of the qualities and capabilities of meeting resource needs. Understanding skill and asset inventories promotes more effective learning and career development opportunities for human resources.

Portfolio Resource Planning

Portfolio resource planning includes reviewing current and planned activities and projecting the needs for both human and other resources and developing plans to fill projected gaps. Human resources planning includes identifying the numbers of people and associated skill sets required to complete the planned activities. Other resource planning steps include making provisions to obtain resources such as equipment, hardware, software licenses, and specialty teams (to handle testing and other functions) needed for the planned activities.

Adaptive/Agile Environment: Portfolio Resource Management

In an Adaptive/Agile environment, at the portfolio level, resource management is not as complicated as in a predictive/traditional environment. Since the team is dedicated to the product and the product roadmap and backlog are continually updated, the team is fully engaged. This approach ensures the teams never go without work that provides value. The team is built with the necessary skill sets across the required functions.

Portfolio Risk Management

Portfolio risk management allows an organization to monitor threats to its portfolio of projects and respond when necessary. Threats may impact schedules, costs, values, and the quality of a portfolio. Management must have the tools necessary to retain the optimized value of the portfolio as the risk landscape changes. Risk measures and metrics are set at the organizational level to serve as threat warnings to portfolio managers. Aggregated portfolio risk tolerances are set to account for individual project performance variations. Subcomponents include:

Risk Management Processes

Risk management processes identify, analyze, track, mitigate, and respond to threats posed to schedules, costs, values, and qualities of portfolios. Risk management plans detail the use of the processes within portfolio settings. Consistent refinement of processes guards against degradation of risk responses and possible project and portfolio losses.

Risk Measures and Metrics

Risk measures act as signposts and alarms in portfolio management to alert governance bodies to impending schedule, cost, value, or quality problems. When these indicators exceed defined tolerances, response plans should be invoked.

Adaptive/Agile Environment: Portfolio Risk Management

In an Adaptive/Agile environment, when selecting Epics, not only are Development/ Technical risk considered but also financial, business, operational, process and organizational risks. Frequent review of potential risks is conducted during iteration(sprint) planning, daily stand-ups, release planning, retrospectives and demos with a data feedback to the governance committees in reviewing and approving Epics.

Portfolio Management Organizational Structure

Portfolio management organizational structure serves as a formalized approach for reviewing proposed and ongoing work. Increases in the level of maturity are demonstrated by a standardized and enforced approach. After uniform processes are in place, reviews identify areas for improvement. Processes are compared against external best practices and targeted for continuous improvements. Subcomponents are:

Governance Organizational Structure

Governance organizational structure measures management organizations necessary for the development of mature and consistent practices that are accepted and executed throughout the organization. A more formal organizational structure is usually centralized and is designed to allow everyone to work collaboratively toward common business goals.

Portfolio Administrative Functions

Project portfolio administrative functions are useful in the performance or management of business operations. A common set of administrative functions facilitates the fulfillment of organizational goals.

Adaptive/Agile Environment: Portfolio Management Organizational Structure

In an Adaptive/Agile environment, the portfolio organizational structure is dependent on the scale of Agile within the organization. At the product level, it consists of product leadership to ensure value is being obtained, any changes in strategy and ensuring alignment. Supporting product leadership are an enterprise architect to ensure alignment of the technology roadmap, the PMO to provide data, analytics and advisory services and the product manager and product owner to facilitate and provide operational and tactical insights. At an enterprise level consisting of multiple portfolios, teams and potential integrations, the portfolio organizational structure applies Lean techniques to manage the Value Stream with organizational structures and administrative functions. In SAFe® Strategy and Investment Funding is at the top with executive leadership, product leadership and enterprise architecture. Supporting the executive level there is Lean Governance with product leadership, the PMO and enterprise architecture and finally Agile Portfolio Governance consisting of the PMO, release management and subject matter communities of practice. In DAE, portfolio organizational structures focus on managing the enterprise IT portfolio with input from product management and enterprise architecture.

Portfolio Performance Management

Portfolio performance management allows an organization to evaluate the performance and relative value of the projects in its portfolio. It allows management to analyze various portfolio scenarios and modify plans resulting from changes in strategies or budgets. This includes evaluating the business value actually realized from each project, program, or initiative and using that information for repositioning the organization’s portfolio.

Subcomponents are:

Portfolio Performance Management Processes

Portfolio performance management should ensure that projects meet postinvestment goals. Should projects within a portfolio vary from performance targets, a portfolio review board is charged with ensuring that corrective action is undertaken. Performance metrics are reviewed for effectiveness in managing portfolios.

Portfolio Information Sharing

Processes are implemented to disseminate critical portfolio performance information to targeted decision makers. The information is used to support decisions to rebalance portfolios and help projects remain on course.

Adaptive/Agile Environment: Portfolio Performance Management

In an Adaptive/Agile Environment, Portfolio Performance Management adheres to the “Agile Manifesto” Principle of “Our highest priority is to satisfy the customer through early and continuous delivery of valuable software.” It begins at the strategy level is cascaded through the product roadmaps or Value Streams, Themes and Epics. Tracking and validating value is derived from the team’s performance and their ability to deliver continued value to customer. Hie goal of the team is short time, reduced risk and maximizing business value delivery. Value is measured by what the team delivers not what the team predicts it will.

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