Effective Portfolio Planning - Part 3 of 3

Dennis Kayser
2 min read

Did you read the first part? If not you can find it here.

Did you read the second part? If not you can find it here.

Project alignment review

Over time the organisation’s strategic goals will evolve and change. Partly that will be in response to an evolving vision, and partly it will be in response to changing organisational conditions.  Those conditions are impacted by everything from competitor or regulator activity to economic changes and even executive leadership changes. That evolution is natural, and is a necessary part of keeping an organisation competitive, but it does impact the work that the organisation carries out, especially the project work that drives advancement and change.

Each portfolio review should include validation that the work underway, and the work planned still aligns with the goals of the organisation. Each project, or proposed project, is designed to contribute to one or more priority areas – revenue growth, market expansion, cost reduction, customer satisfaction, etc.  Each project also has an estimate of the size of contribution it is expected to make to each of those target areas.  The review needs to ensure that both the priority areas that projects are focused on are still relevant, and that the size of the contribution is still adequate.  From that review any projects that are underway and appear out of alignment should be modified to ensure they contribute appropriately to relevant goals, or cancelled if they are unable to contribute to the evolving needs.

For projects that have not yet started there may be decisions taken to remove projects from the portfolio, and / or approve additional projects to ensure that the portfolio as a whole aligns with the goals and contributes sufficiently.  Over and above adding and removing projects, there is likely to be a re-prioritisation of planned initiatives to ensure that those projects that are planned to make the greatest contribution to the organisational goals are started as soon as practical – the equivalent of re-prioritising the portfolio backlog.

Next phase funding

Once both forms of review have occurred the organisation can release funding for the next period – approving projects to proceed that are expected to start in the next quarter (assuming quarterly reviews).  That approval will be a drawdown against the currently unspent portfolio budget and will be dependent on resources being available to consume that investment.  Those resources will come from projects that are completing, from initiatives that have been deferred or cancelled, or from growth in the resources available for project execution.

By releasing the funds for investment only when they can be used organisations avoid tying up funds that could be better used elsewhere, and they minimise the need to reallocate funds from projects that are no longer aligned with their needs.  Further, by reviewing investments every few months there is an ability to more quickly identify and address problems, minimising the investment dollars that go to waste.


Annual planning cycles may be a cornerstone of how organisations undertake their strategic planning, but they are becoming increasingly inappropriate for the global marketplace of today.  Organisations must adjust more quickly, responding to competitive threats and predicting others.  The idea that strategies can remain stable for eighteen months or more is simply unrealistic in most industries, and that requires a rethinking of how organisations plan and execute their strategic portfolios.

To respond to an ever faster paced world, planning has to become more frequent and less far reaching.  The closer that planning and execution can come, the less opportunity there is for work to be misaligned or unfocused.  That doesn’t mean organisations can lose sight of the need for a long term strategic vision, nor for medium term strategies to deliver that vision, but it does require a great deal more flexibility and adaptability than in the past.

Do you want to see a demo of how Forecast does portfolio planning, or anything else resource and project related; then book a personal 30 min. slot with our success team. We're looking forward to hearing from you.

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