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Manage the entire year's work with a portfolio

When managing work in a portfolio, you need to ensure that the work in progress is actively managed and that future work is continually planned and forecasted. You'll also track completed work to analyze whether the business benefits were realized.

Portfolio management typically applies to managing your personal financial resources, but recently the concept has become popular as a way to manage the processes that drive decisions within your IT organization.

In many companies, management focuses on the work that is in progress. However, when you’re managing work as a portfolio, you need to look at everything. Not only do you actively manage the work in progress, but you continually plan and forecast future work to ensure that all critical work is completed and client expectations are met. And you track work that is completed to ensure that the projected business value was met and to gauge the impact to the support organization. Let's look at how to manage work within a portfolio for the entire year.

Scheduling the work
We'll assume that all of the major work for the year has already been prioritized and approved. I know that this is not always a clean process and that many times you start your fiscal year without approved budgets and projects. However, somehow every company gets through the process and ultimately has approved work and an approved budget.

Portfolio management series
This is the third article in our series on portfolio management. Also see "Use portfolio management to maximize IT spending" and "Plan and prioritize work within the context of an entire work portfolio."

At this point, most companies divvy out the work to the internal departments that will be responsible for execution. However, in portfolio management, the high-level plan for carrying out the work is maintained centrally. The senior managers work as a team to map out the workload for the year, taking into account the following factors.

Support
Normally, support is staffed at a steady level throughout the year. The support resources should be in place at the end of the year and continue to perform their jobs into the new year. Changes in priorities may require fewer or more support resources.

Carryover work
Important work that’s in progress needs to be continued. You can’t just stop this work and then start it up later.

Business priorities
The IT resources need to be aligned to support the highest priority projects first. This staffing is coordinated with the client organizations. For instance, if the marketing division starts an initiative that requires IT support, the IT resources must be aligned and ready to start as well.

Capacity
It’s a given that all the business units will have high-priority work they want to get done right away. But you don’t have the capacity to do everything at once. Managing the portfolio means that the totality of work needs to be prioritized across all the divisions. This might mean, for instance, that multiple initiatives from the sales division are worked on first, while the finance division's priorities are deferred until later in the year.

Keep your eye on the totality of work in the portfolio
Most organizations manage work by focusing on projects in progress. Once a project is completed, management forgets it. There is some sense of the future work in the pipeline, but mostly just awareness that the work is approved and will be staffed and executed at some point.

One of the features of portfolio management is the ability to keep the entire portfolio visible. This includes work you’ve completed, work that’s in progress, and work that’s planned for the future. In that way, you continue to manage the body of work as a portfolio. Again, think of the work as a puzzle. You need to keep track of all the pieces if you want to successfully complete the puzzle.

Work in progress
Most management teams are used to focusing on the work in progress. The difference with portfolio management is that senior managers have a view of all the work within the scope of the portfolio—not just the work that is within their functional organization. This view doesn't just include projects in progress but the support work as well.

The management team must have feedback on how all of the work is progressing. This is typically done through status reporting. Many organizations use high-level summary reporting that includes a stoplight indicator of green (okay), yellow (caution), or red (trouble) so that the managers can instantly focus on areas of trouble. Remember that the portfolio of work has been scheduled out for the entire year. If one project goes over budget and deadline, it’s not only a problem for that project, but it’s also causing trouble for the portfolio. If a project ends up going over its end date by 30 days, it’s very likely that some other approved work will be delayed by 30 days because the planned resources will not be available. If a number of projects are delivered late, there may be approved initiatives that cannot be started at all.

Future work
When you’re managing work as a portfolio, you must create a plan that schedules out the work for the entire year. You don’t want to have a major project end and not be sure what to do with the available resources. Likewise, you don’t want a client organization to begin a major initiative only to find out that IT doesn’t have the resources available to support it.

Just as a project manager schedules the detailed activities on a work plan, the senior managers need to work with their clients to create a master schedule of work for the portfolio. And just as the project manager must continually update the work plan, you must evaluate the portfolio schedule on a monthly basis. Update the portfolio schedule to reflect the current projected end dates of projects in progress and changes to client priorities during the year. It would be great to schedule a smooth staffing line throughout the year, but the timing of work from a business perspective may not allow it. In those cases, you may have to bring in contract staff to handle workload peaks.

Completed work
It’s important to keep track of completed work to determine whether the business value is being achieved. In most organizations, this is a missing step. The IT team needs to work with the business clients to track the benefits of the work. This information will be used as feedback in future decisions.

The other reason to track completed work is that most projects deliver products that must be supported. Remember that support work is also a part of the portfolio. So, it makes sense to understand the cost and benefits of the project, and then continue to track the costs and benefits of the solution throughout its lifespan. I'll discuss this more in a future column that focuses on portfolio metrics and feedback.
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