The Portfolio Manager
The title ‘Portfolio Manager’ has become one of the most diluted job titles today. Anyone with experience in project management or a PMO role seems to qualify for a position in portfolio management. This is partly because portfolio management is still an evolving discipline, closely tied to project and program management. However, a key difference often gets overlooked: the time horizon and the point at which a change signal is addressed.
Responsibility and scope of Portfolio Management
Portfolio management focuses on the process from the first signal of change until it’s ready for further development in projects or programs. The actual execution is not the responsibility of the portfolio manager – that’s for sponsors and steering committees. Only after a change is completed does portfolio management step in to monitor the benefits and report on them.
The real essence of portfolio management lies in achieving strategic, organizational, or political goals with a long-term view. A portfolio manager looks beyond the short term; typically, the horizon is more than five quarters ahead. This is in stark contrast to approaches that aim to deliver changes in three-month iterations – that’s an execution methodology, not portfolio management.
There is also frequent confusion about what portfolio management is not. It’s not about reviewing project plans, assessing proposals, or playing an "über steering committee" role with a portfolio board. Nor is it about making lists and reporting on the status of ongoing projects – that’s what project managers and steering committees are for. Portfolio management only steps in during execution if deviations impact the portfolio at a higher level. Where mistakes are made..
Unfortunately, in many organizations, portfolio management is reduced to creating top 10 lists of urgent change signals and reporting on the status of ongoing initiatives. However, if portfolio management truly wants to steer strategically, it must focus on the future. It’s about identifying both internal and external influences on the portfolio, not just today but also in the (distant) future.
A real portfolio manager doesn’t just have oversight but also the authority to make decisions. Too often, portfolio managers function as advisors who generate reports and make recommendations, rather than actively managing the portfolio.
Within public organizations
In public organizations, we see various forms of portfolio management, from strategic portfolio managers to other, more exotic variations. However, nearly every organization struggles with two primary challenges: limited capacity and the ability to prioritize. The typical response is a process-driven one: mapping the situation and implementing a new methodology. But when that doesn’t work, the blame is often placed on the organization for not understanding the methodology. Instead of forcing the methodology to fit, we should address the root cause of the portfolio stagnation.
The core issue often lies in the accumulation of urgent initiatives that all seem to be a priority. Want to tackle this effectively? Let portfolio managers develop long-term scenarios that force decision-makers to make the tough calls.
Please stand up!
Our vision? A public sector where portfolio management is strategically positioned and far less focused on managing individual projects and programs. We’re already seeing promising examples, but now is the time to let them flourish.
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