Don’t Fear Failure and Focus on Success – How to Manage Your Agile Project Portfolio
At the level of a single project, everything seems straight-forward: Agile principles help to develop a product or service step by step, rather than on the basis of a detailed and complicated master plan. The advantage: Not only do project teams achieve results more quickly, also scope creep is avoided and the results are based on actual customer needs.
However, what does this look like at a higher level? Do companies use Agile throughout their whole business and evaluate their overall project portfolio based on Agile principles – and what are the biggest challenges facing Agile Project Portfolio Management?
71% of Project Organisations Rely on Agile
Agile is the de-facto standard on project teams. According to a study carried out by the Project Management Institute, 71 percent of all project organisations rely on Agile – this mainly applies to work within a project. However, the numbers do not reveal whether Agile has prevailed as the standard for Project Portfolio Management.
In collaboration with Forbes Insights, the Project Management Institute recently surveyed 500 C-level executives: Is the C-suite aware of the importance of Agile? How can businesses create an Agile culture that encompasses not only individual projects, but the whole business? The result shows that 92 percent of the senior executives questioned are firmly persuaded that agility and the ability to quickly adapt to market demands and external factors is a critical success factor for their business.
However, in the study Achieving Greater Agility: The Essential Influence of the C-Suite, just 27 percent considered their own actions ‘highly agile’. They have a hard time implementing changes in strategic direction, as well as finding it difficult to curtail or change their organisation’s project portfolio when external circumstances demand it. In other words, Agility has not yet arrived in most companies in the area of portfolio management, whereas it has long been the norm at project level.
Better to Reach a “Point of Anticipated Failure” Than a “Point of No Return”
The same Agile principles that development teams use at project level are also valid for portfolio management and can help answer the following question: How do we find the ideal project mix and prioritise initiatives that are most likely to succeed and meet customer needs?
In practice, projects are often critically evaluated too late. If a new project starts, all traffic lights remain green in the first days and weeks. The project team is fully motivated and is making rapid progress. The status report says that everything is ‘on track’ – now there seems to be no turning back, the point of no return has been reached. But suddenly the waters become increasingly turbulent. Resource bottlenecks become visible, the team is only making marginal progress and the budget is running dry – the prospects aren’t anywhere near as positive as they were at the beginning of the project.
Every single day a project gets closer to the point of failure equates to higher losses for the company, until the management finally decides to pull the plug to limit damage. However, would it not be possible to anticipate the point of failure earlier rather than burn valuable resources and push the team’s frustration level to the extreme?
Determine the ideal Project Mix à la Agile
The answer is yes, it is possible. The challenge for a company’s management is to be able to objectively evaluate the entire project portfolio at all times. If the information required to assess the project has to be collected and processed first, valuable time is wasted and problem continues to grow. For this reason, this information should always be available for the entire project portfolio and not just when there are doubts about whether individual projects are going to be successful or not. Agile organisations manage their project portfolio like a funnel and continuously assess the value, chances and risks of all projects, with the goal of building a balanced project portfolio.
Manage your portfolio like a project backlog. Just as you discuss stories and tasks as part of your grooming sessions at the individual project level, so also you can discuss resource bottlenecks, dependencies and prospects of success at the portfolio level. Do not hesitate to press the pause button for projects which add little value or have slim chances of success. You could even put them at the end of the backlog. On the contrary, move projects that promise the greatest value to the company to the beginning of your project backlog. Give them more resources in order to accelerate progress and achieve results more quickly.
Data-Driven Agile Portfolio Management
Unlike traditional portfolio approaches, Agile Project Portfolio Management is more dynamic and provides you with more flexible options. Through regular and productive review meetings and thanks to consistent and transparent KPIs across your entire project portfolio, you create a single source of truth. If you consistently manage your projects in Jira, you can obtain all the important information at the push of a button. We recently introduced an add-on that makes managing the portfolio even easier – try out the trial version of swarmOS Cockpit free of charge and without any obligation.