When you think of “enterprise portfolio,” it might conjure up an image of suit-clad executives sitting around a table, debating how to divide up a multi-million dollar budget behind closed doors.
Source: www.businessillustrator.com
That’s definitely one application. But that model is becoming increasingly antiquated.
The group of people that rise to that position tends to be homogenous. They usually have similar backgrounds, worldviews, and economic or political power.
Yet there’s a business case for diverse perspectives. We can be more intentional about the people we recruit and there are ways to avoid accidentally creating an elitist portfolio team. Which are good steps for breaking down barriers and reducing blind spots. But we can go further.
The annual plan ≠ the real enterprise portfolio
Stripped back to the basics, portfolio management means investing resources consciously, with the aim of creating greater value over the long-term.
Your enterprise portfolio is more than the large projects on the executive radar. It’s everything your organization invests in.
That includes every action and decision that groups and individuals make. Everything from planned initiatives and acting on new insights, to firefighting and distractions.
This matters because we’re in a world where it’s possible for a tweet to have a bigger impact on a business than a carefully crafted campaign. In a networked and complex world, small changes can have a large impact.
As we move toward decentralized control, flatter organizations, networked teams, and a freelance economy, these changes can happen anywhere. Portfolio concepts become even more, not less important. Especially a distributed portfolio.
What’s a distributed portfolio?
A past article outlined eight components that make up the portfolio essentials,
- Current state
- Future state(s)
- Value framework
- Portfolio allocation
- Experimentation & research
- Execution support
- Intake/triage
- Dynamic views
With these eight elements in place, you’ll have a sustainable, effective, adaptable, and intentional process for managing a set of work.
A distributed portfolio means each group and individual needs to consider these essentials in their own work. Not just an executive group or official “portfolio team.”
That requires asking questions like,
- What do we know or think we know about the world, what are we working with, and what would we like to create?
- How do we define value, decide which work rises to the top, and divide up our time, energy, and money?
- Which ways will we test our assumptions before going all-in?
- When will we take action and support the people who will help us execute the change?
- How will we handle incoming requests for our attention, and communicate our goals and progress with others?
For example, you probably already use at least a few of the portfolio essentials in your own life.
- Current state: Your observations, knowledge, and worldview.
- Future state: Your dreams, goals, or vision of your ideal life.
- Value framework: How you prioritize, your personal values, organizational, cultural, or biological influences on your decision making.
- Portfolio allocation: How you spend your time, energy, and money.
- Experimentation & research: Any time you take action to get feedback and learn, whether that’s a conversation, prototype, or research project.
- Execution support: Project plans, to-do lists, and deadlines.
- Intake process/triage: How you manage incoming information and requests. For example, GTD is a popular framework.
- Dynamic views for different stakeholders: Sharing your calendar, creating reports, or updates with your family and friends.
We all make individual portfolio decisions on a daily basis. And those decisions interact with other individual portfolios. Which combined represent the reality of how enterprise resources are being invested.
What does a distributed portfolio look like?
It’s a series of feedback loops.
As individuals, we invest our resources given the information we have, our value framework, and need to coordinate with others. So the final portfolio investments are defined both from the top down and the bottom up.
Teams treat the outputs of execution support from a higher-level portfolio as new information to triage. The portfolio team could also interpret the information shared by teams as inputs to their own work.
We can gain alignment and efficiency by syncing up the essentials between individuals and groups across an enterprise.
For example, a shared knowledge base can help everyone understand where you’re starting from and trying to go, so they can take that information and filter it through their own value framework.
Or you can align the company with a value framework so that decisions are made with a certain rubric regardless of the information involved, like what Disney does with their quality standards.
We can inject diversity by varying the content of the essentials across groups and individuals.
Two groups working from different assumptions about the current state and driven by different values will end up with different outcomes. Depending on what you’re trying to accomplish, that might be desirable.
What does that mean for our daily work?
A distributed portfolio means that we all have both more and less control over the enterprise portfolio than we might realize.
Going forward, to manage a distributed portfolio we can,
- Be more conscious and intentional about our own portfolio of work.
- Practice awareness of our impact on others and their influence on our own portfolio decisions.
- Tweak the portfolio essentials to encourage alignment or diversity as needed.
- Pay attention to the real aggregate enterprise portfolio, which may not reflect what we would like it to.
Our ability to reach enterprise goals is not strictly determined by pay grades or titles. We need to open up those conference room doors and start conversations. Plus recognize and take responsibility for our individual impact on the bigger picture, whether we’re dreaming of a better workplace, industry success, or a different society.
Is your organization like the illustration at the beginning of this article? What do you think the largest barrier to change is?