Playing the “What-If” Game with your Portfolio

This is the second article in a three-part series on portfolio optimization.

In part one of this series, I emphasized the importance of optimizing your resources based on the multitude of projects that companies have to fund at any one time. Solving the resource allocation problem is a great start but the next natural question for executives is, “Are we committing our resources to projects that are adding real value to our portfolios?”

How confident is your team when answering these types of questions during your portfolio review sessions?

A new regulatory project was just created. What is the revenue impact to our portfolio if this project is moved to the top of the priority list?
Is it possible to optimize portfolio revenue if I delay the start date of a group of projects by say, six months?
Budgets are being cut next year. Which projects do we fund and which ones do we kill?

If you are uncertain when tackling these kinds of tough questions, it is time to update the tools you use when making portfolio decisions. If you don't, you run a higher than necessary risk of making a bad decision with potentially devastating and long-lasting consequences for the future of your organization.

Navigating Unknown Territory

It's all over the news. An escalating trade war … European, Asian and U.S. markets experiencing wild swings in value … Daily turmoil within political systems … Talk of a global recession in 2019/2020.

Conversely, in the U.S., the unemployment rate is at historic lows, which is contributing to a strong economy, which in turn is leading to strong corporate results.

With all of this conflicting information, how can you feel confident that the correct portfolio balancing decisions are being made? Can you afford to continue to make portfolio decisions by looking in the rear-view mirror or should your company make these critical decisions by looking at future trends?

Making the Right Portfolio Decisions

Your organization needs the ability to make informed portfolio decisions based on trusted data — not ‘gut feel.' You'll find this extremely difficult to do without an end-to-end software platform like Accolade.

When evaluating solutions it's essential that you can see at-a-glance a detailed analysis of your current portfolio. A good supporting software will allow you to set new constraints that may have changed since the last analysis (such as FTE and budget revisions) as well as select which key metric you want to maximize or minimize (such as revenue or cost).

When analyzing new scenarios, can you quickly get answers to questions like these?

Will we underachieve, meet or exceed our revenue targets broken down by Strategic Initiative?
Will FTE and/or capital costs come in line with current resourcing and budget requirements?
Which initiatives should we be taking a closer look at in terms of continuing or killing specific projects/products?

With Accolade, these questions and more can be quickly analyzed, saved and presented to decision makers prior to committing any proposed changes back to the portfolio. We call it a "what-if scenario."

For executives, imagine having the ability to look forward vs. relying on outdated information to counter a new product threat by your main competitor. Having this capability could lead to decisions that may keep your organization ahead of the pack for years to come.

For individual contributors, imagine having the ability to communicate to the people you rely on for successful project/product completion which initiatives they should be concentrating on … based on facts. Empower your team with the knowledge that they are contributing to the success of your company instead of working on initiatives that add little or no value to your company's mission.

If your company would like to achieve this kind of portfolio visibility, reach out to me on LinkedIn. Let's have a discussion and determine if Accolade is the appropriate tool to help you and your organization achieve the optimal portfolio balance

Read the final part of the series, which answers the question: “what else can I do with Accolade's portfolio optimization capabilities? ”