Why an organisation’s portfolio needs everyone’s input

by Nicki Carruth | May 24, 2022 | Portfolio Assurance

Portfolios of initiatives in a business are a useful way to think about operational activity at any given point. What projects, programmes or non-BAU activity is being committed to with resources and budget to drive towards the organisation’s strategic goals? The success of these activities are often down to more than just their independent performance, but how they interplay and support each other. The portfolio of programmes and projects needs to be consistently reviewed, and at key moments, shuffled around to ensure the most critical things are focused on first.

Making decisions around the priority of an organisational portfolio needs more than just one role – it’s something that is arrived at through the combination of different senior roles and even some input at times by the individual project teams.

In this article we cover how various groups or roles contribute towards the portfolio and how initiatives are prioritised within it.

Leadership Teams

The call around which projects need the backing of the business via budget and resource should be ultimately made by senior leadership teams. The strategic goals of the business are typically on the shoulders of the leadership team. Where the budget is allocated to meet these should be part of regular discussions within meetings, with careful consideration made to any redistribution of attention. It’s important that changes aren’t made constantly as this can disenfranchise the teams responsible for delivering the work. Giving some surety is useful, and the communications around changes that will be felt by staff needs to be carefully done.

Leadership will be accountable to the CEO and the CEO to a board. In the public sector the Minister will ultimately be accountable to the government and the NZ public as a whole. Their expectation is that senior leaders will have the experience and vision to carry out a mandate from the government in the most effective way possible.

Within the leadership team, it’s expected there will be healthy debate and review of which areas of the business require attention, with each leader responsible putting their case forward. But senior leaders also need to act as advocates for each other, guiding their own business units through uncomfortable change should their projects be adversely affected by leadership decisions.

Ministers

This obviously pertains only to government departments. The minister in charge of that organisation will be responsible for overseeing, developing and questioning that function of government. A minister’s direction may be developed by them individually, or may be part of a wider cabinet or government mandate. The minister will also need to be kept close to the senior leadership team to provide guidance as needed. Ministers are not tasked with the day to day operation of a government department, but they are accountable to the Prime Minister for how well it is running, so there is regular contact between ministers and their various portfolio departments or ministries.

So what does this split of responsibility mean for a project or programme portfolio? Given the nature of government, especially post election, there is quite a lot of involvement a minister will have in terms of what’s set as priority. If the government changes, a new minister comes with a new perspective but more importantly, a fresh set of objectives from a totally changed government. Perhaps the previous strategic outcomes were based around internal systems and people. Even the same government can redirect their focus on other things during a term, which can flow through into a slow down of internal initiatives and more on public-facing functions.

It’s the ministry’s responsibility to react and adapt to these changes. However, it’s the senior leadership team’s responsibility to affect change in a way that doesn’t provide a risk to the organisation through significant people loss or any adverse impact on the public.

Therefore, the minister’s involvement in a portfolio is one of huge influence, and it’s vital that there’s a close working relationship between them and their SLT.

Boards

As the group responsible for overseeing the performance of the executive team as well as the financial performance and governance, a board has a vested interest in the way in which business activities are prioritised.

While board members won’t have anything to do with decision making around the operation of the business, they do influence these decisions by establishing a vision and policies around the governance of the business. They’re also in charge of hiring and determining the effectiveness of executive team members in order to help the business perform to its best.

The board is in place to protect the business and its shareholders. They’ve got a close interest in the financials of the organisation and may vote on matters that influence the reprioritisation of programmes and projects to better achieve goals.

Programme directors and managers

Programme directors and other leadership roles at the programme level sit in an interesting position between senior leadership and delivery teams. Their responsibility is to ensure a programme is meeting its milestones and outcomes. If there are multiple projects running as part of a programme and concerns around the programme’s overall effectiveness at meeting milestones, the programme director may make decisions or contribute toward decisions that change how projects are delivered. That includes what projects come first, due dates, scope changes, resource and even budget reallocation. Programme leadership is typically much closer to the project than senior leaders and thus has good insight as to what practical changes need to be made.

Business Units

The business units within an organisation don’t necessarily hold the responsibility over what projects or programmes take priority. But the leaders and staff in these teams are at the least influencing parties. Take for example a project designed to improve the usability of customer data. Feedback from the teams requiring this data for their work may show that the current solution in development does not include some fundamental features to meet the objective of making everyone more efficient. This issue may cause negative impact to the organisation’s strategic objectives, and thus the project may demand higher priority and more resource to add this extra functionality by a given date.

Equally, a project may cease to be as important as it once was due to external factors, and start to lose stakeholder buy-in. These insights could influence a leadership team to push it down the list or even stop it entirely.

Project Teams

Are project teams really responsible for which projects are top priority? No, they aren’t. But that doesn’t mean they don’t play an integral role in the decisions that get made further up the organisation. Let’s explore some of the ways the delivery teams help determine how a portfolio should be managed:

Progress of delivery against milestones

When a project is consistently meeting its milestones for delivery, such as the development of certain features on a new system development project, the business can proceed with confidence that the project has a lower chance of failure. One of the more common threats to the success of a project is through milestones being missed and the knock on effects this has with the rest of the project. Leadership teams are less inclined to stop the momentum of a good project in its tracks, instead finding stalled or continually late projects to consider deprioritising.

Project teams that are running well will indirectly influence decision making when a portfolio needs to be re-evaluated.

Budget efficiency and time management

While milestones being met is one time-based measure of a project’s success, it doesn’t tell the full story. Milestones can be met, but how they do that varies. If the milestones are met, within the budget set out for that stage – excellent. The next thing to assess – are the project delivery team members able to complete their work within the standard work day or contracted hours and still meet those deadlines? If so, there’s some good signs the project is running efficiently. But there are situations where staff are working huge hours to get things done on time. This poses some risks such as staff attrition and budget blowouts due to overtime contractors.

If the project team is on time, on budget and working their normal hours – that project may be one to keep going as success is more likely.

Impact of the project’s outputs on the business

How well has the project’s deliverables to date been felt by the rest of the business? Many projects don’t have to be 100% completed before a soft launch or partial roll out with limited features. This is actually very common for technology projects where beta testing is part of ensuring the proper launch is successful.

If the rest of the business, including leaders across different teams are advocates for the project and its value, the project will likely be kept as a priority within a portfolio. The measure of value may even extend to financial benefits, in which case the decision is even clearer for a leadership team to keep the project alive.

Chat to our team to learn more about how we approach programme assurance.