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Overcoming Barriers to Sustainable Innovation and Program Management

This paper outlines the goals of program portfolio management. It introduces key management principles and provides a best-practice framework for developing a program and portfolio management process. Program and portfolio management is the process by which organizations manage the prioritization of initiatives and the allocation of resources. This process is a critical discipline that enables the governance of projects entering the development or program pipeline. The decisions faced by federal, aerospace and defense (FA&D) organizations in managing portfolios shape the future of those organizations and drive their innovation agendas.
The agendas, in turn, determine the performance and success of innovation programs. FA&D organizations that excel at managing their innovation processes and portfolios launch technologies and programs on time and within budget. Implementing a portfolio management process effectively is a challenge. Too frequently, when it comes to making difficult portfolio decisions, politics and inertia win the day.
Research by the Aberdeen Group found that 59 percent of organizations consider balancing the innovation development pipeline with development capacity a top priority for improvement. The goal of portfolio management is to allocate resources and budgets to projects and initiatives that maximize the value of the portfolio, while maintaining a good balance between short- and long-term projects and high- and low-risk/return projects. Additionally, the process aims to provide objective prioritization with a strong link to strategy. To achieve these objectives, organizations require a sustainable portfolio management process that defines how the organization collects portfolio data, prioritizes projects, and communicates portfolio decisions across the organization. This process should incorporate five key principles: - High quality, real-time data; - Powerful visualization; - Efficient exploration; - Insightful scenarios (what-if); and - Resource commitment. These principles create a framework for designing and implementing a portfolio management process that allows an organization to better allocate scarce resources and drive sustainable growth.

 

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