10-2 Reflections Explain new product development. What are the main sources of funding for new product development? List the ways in which new product innovations can be protected. What are the key features of a market launch plan? What is the commercialization of new products? What are the main traits of an entrepreneur?
10-3 Activities [Discussion of selected student ‘Activities’ from previous chapter]
10-4 Learning Targets Explain the main ideas behind project portfolio management Describe four key strategies used in portfolio management Name a number of tools that can be used for portfolio management Explain the use of bubble diagrams as a means of evaluating portfolios Understand the difference between the portfolio dominant and project dominant approaches Discuss why organizations often have a mix of low- risk and high-risk projects
10-5 Portfolio Approaches Portfolio management is about continuously choosing, managing, and adapting the mix of projects to match resource availability and contribute to organizational goals Key approaches include: Maximizing the value of a portfolio Creating the right mix of projects Maximizing alignment with goals Optimizing resources
Portfolio and Project Management Portfolio Management Project Management Team s Individual s Teams Skills Learning Review Goals Statements Requirement s Strategies Measures Results Status Scorecard Trends Innovatio ns Stimuli Creations Problems Ideas Projects Specification Ranking Schedules Deployment
10-7 Maximising Value
10-8 Creating the Right Mix
10-9 Right Mix > Quadrants Pearls - Low risk and high reward projects. Oysters Risky projects with potential of high reward Bread and Butter Often small, simple projects – high likelihood of success, but low reward. White Elephants Low probability and low reward projects. One third of all projects and about 25% of spending are White Elephant.
10-10 Right Mix > Types of Bubble Diagrams Risk Vs. Reward Technical Newness Vs. Market Newness Ease Vs. Attractiveness Strength Vs. Attractiveness Cost Vs. Timing Strategy Vs. Benefit Cost Vs. Benefit Etc. etc.
10-11 Right Mix > Examples Risk Reward High Low Uncertainties
10-14 Scope Matrix
10-15 Maximizing Alignment With Goals
10-16 Optimizing Resources Optimizing resources is the process of balancing the Funding Worker hours Skill requirements of the project portfolio with the resources available over a period of time
10-17 Portfolio Resource Loading
10-18 Portfolio Budgeting Budgeting is an important mechanism for controlling and reviewing the progress of an innovation plan Allocated budget will determine the overall investment in terms of resources and commitment Common budgeting methods Top-down budgeting Bottom-up budgeting
10-19 Balancing the Portfolio Maximizing contribution based solely on financial methods can lead to short-term, low-risk projects. A solely strategically aligned portfolio, may not yield any short-term benefits necessary to maintain momentum. Too rigid pursuit of the screening process can result in behavior such as: Abandoning the more radical of proposed innovations Focusing too heavily on a particular technology Concentrating too much on existing markets
10-20 Dominant Assessment Approaches Gates dominant Focus on reviewing each stage gate within the individual projects in the portfolio Suitable where portfolios are static Portfolio dominant Favors a portfolio view over an in-depth review of individual projects Suitable in fast, dynamic organizations where projects are changing regularly and where the business environment is fluid
10-21 Classification of Projects
10-22 Summary Explain the main ideas behind project portfolio management Describe four key strategies used in portfolio management Name a number of tools that can be used for portfolio management Explain the use of bubble diagrams as a means of evaluating portfolios Understand the difference between the portfolio dominant and project dominant approaches Discuss why organizations often have a mix of low- risk and high-risk projects