Agile portfolio management
| Agile portfolio management |
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Agile portfolio management is an approach to managing a portfolio of projects that are related to a single strategic goal. It is based on the agile methodology, which emphasizes continuous improvement, collaboration, and flexibility. Agile portfolio management focuses on prioritizing projects and tasks, managing resources, and making decisions quickly. It also involves determining the scope of projects and allocating resources in a way that maximizes value and minimizes risk. The goal is to ensure that the right projects are being completed at the right time to achieve the desired strategic objectives.
Example of agile portfolio management
- A company may use agile portfolio management to organize their projects and tasks. For example, they may prioritize the projects based on their estimated value and risk. They may then allocate resources accordingly to ensure that their most important projects are completed in a timely manner.
- Another example of agile portfolio management is using the Scrum methodology, which is a type of agile approach. This involves breaking down projects into smaller goals and then having teams work on those goals in short sprints. At the end of each sprint, the team reviews the progress made and adjusts the plan accordingly. This allows the team to be more agile and make changes quickly as needed.
- A third example of agile portfolio management is using an Agile Kanban board. This board lists all the tasks and projects in a visual way and allows team members to quickly identify what tasks need to be completed and their priority. This helps teams to stay organized and focused on the most important tasks.
When to use agile portfolio management
Agile portfolio management is a useful tool for organizations that need to quickly identify and prioritize projects that support their strategic goals. It is particularly beneficial in cases where several projects must be managed simultaneously and resources must be allocated in a way that maximizes value and minimizes risk. Agile portfolio management can be used in the following situations:
- When an organization has limited resources and needs to prioritize projects quickly in order to maximize their value.
- When there is a need to identify projects that support the organization's strategic objectives.
- When the organization needs to regularly monitor and adjust the scope of projects.
- When the organization needs to quickly adjust resources to accommodate changing project requirements.
- When the organization needs to quickly make decisions surrounding resource allocation and project prioritization.
- When the organization needs to balance the need for speed and agility with the need for careful planning and execution.
Types of agile portfolio management
Agile portfolio management is an approach to managing a portfolio of projects that are related to a single strategic goal. It is based on the agile methodology, which emphasizes continuous improvement, collaboration, and flexibility. There are several types of agile portfolio management, which include:
- Scrum: Scrum is an iterative and incremental agile method for managing complex projects. It focuses on breaking projects into manageable pieces, known as sprints, and then delivering a working product at the end of each sprint.
- Kanban: Kanban is an agile methodology that uses visual boards to visualize the progress of a project. It focuses on continuously improving the workflow and limiting the amount of work in progress at any given time.
- Lean: Lean is an agile methodology that focuses on eliminating waste and delivering maximum value in the shortest amount of time. It emphasizes on continuous improvement and reducing cycle time.
- Extreme Programming (XP): XP is an agile methodology that focuses on collaboration and communication between team members. It emphasizes on delivering working software in short iterations, and continually improving the process.
- Feature-Driven Development (FDD): FDD is an agile methodology that focuses on delivering features quickly and efficiently. It emphasizes on breaking projects into manageable chunks and delivering the most important features first.
Steps of agile portfolio management
An effective agile portfolio management process consists of the following steps:
- Establishing the goal: This involves defining the strategic objectives and determining the desired outcomes that the portfolio should achieve.
- Ideation: During this phase, potential projects are identified, prioritized, and evaluated based on their potential for delivering value.
- Resource allocation: Resources are allocated to the selected projects to ensure that they can be completed in a timely manner.
- Execution: During this phase, the projects are implemented, monitored, and controlled.
- Review and optimization: The portfolio is reviewed and optimized on an ongoing basis to ensure that the projects are meeting their objectives and delivering maximum value.
- Closure: The portfolio is closed when the desired outcomes have been achieved.
Advantages of agile portfolio management
Agile portfolio management offers many advantages, such as:
- Improved visibility and control over projects. Agile portfolio management provides better visibility and control over projects, allowing portfolio managers to identify potential risks and opportunities more quickly. It also helps to ensure that the right projects are prioritized and resources are allocated correctly.
- Increased collaboration. Agile portfolio management encourages greater collaboration between teams, allowing them to identify potential risks and opportunities more quickly and come up with creative solutions.
- Improved decision-making. Agile portfolio management allows teams to make decisions quickly and effectively, allowing them to adjust their strategy as needed.
- Improved communication. Agile portfolio management allows teams to communicate more effectively, which improves the overall efficiency of the portfolio.
- Faster delivery of projects. Agile portfolio management allows teams to deliver projects faster, as they are able to identify potential risks and opportunities more quickly.
- More flexibility. Agile portfolio management allows teams to be more flexible, as they can adjust their strategy as needed. This allows teams to respond quickly to changes in the market and customer needs.
Limitations of agile portfolio management
Agile portfolio management is a useful approach for managing a portfolio of projects related to a single strategic goal, but it has several limitations. These include:
- Lack of visibility: Agile portfolio management can be difficult to track due to its decentralized nature. This makes it difficult to know what projects are being worked on, how they are progressing, and how they are impacting the overall strategy.
- Lack of standardization: Because of the decentralized nature of agile portfolio management, there is no standard way of setting goals and measuring progress. This can lead to confusion and inconsistency in the way projects are managed.
- Difficulty in measuring success: Agile methods don't lend themselves well to traditional measures of success such as time and cost. This makes it difficult to accurately measure the effectiveness of the portfolio management process.
- Difficulty in managing large portfolios: As the number of projects in the portfolio increases, it becomes more difficult to manage them effectively. This can lead to delays in project completion, missed deadlines, and an overall decrease in productivity.
Suggested literature
- Stettina, C. J., & Hörz, J. (2015). Agile portfolio management: An empirical perspective on the practice in use. International Journal of Project Management, 33(1), 140-152.
- Krebs, J. (2008). Agile portfolio management. Microsoft Press.
- Horlach, B., Schirmer, I., & Drews, P. (2019). Agile portfolio management: design goals and principles.
