When it comes to managing portfolios, there are two main approaches that organisations can take: Lean Portfolio Management and Traditional Portfolio Management. Incorporating Lean Principles into Portfolio Management Strategy . Both have their own set of advantages and disadvantages, and it is important for companies to carefully consider which approach will best suit their needs.
Traditional Portfolio Management is a more traditional approach that has been used by organisations for many years. This approach typically involves a top-down decision-making process, with decisions being made by senior management based on a set of predetermined criteria. Projects are often selected based on their potential return on investment, without much consideration for other factors such as resource availability or strategic alignment.
On the other hand, Lean Portfolio Management is a more modern approach that is gaining popularity in todays fast-paced business environment. This approach is based on the principles of Lean and Agile methodologies, which focus on continuous improvement, collaboration, and flexibility. In Lean Portfolio Management, decisions are made collaboratively by cross-functional teams, with a focus on delivering value to customers quickly and efficiently.
One of the key differences between Lean Portfolio Management and Traditional Portfolio Management is the level of flexibility and adaptability that each approach offers. Traditional Portfolio Management tends to be more rigid and inflexible, with projects being selected and planned out in advance. This can lead to projects becoming outdated or irrelevant as market conditions change.
In contrast, Lean Portfolio Management allows for greater flexibility and adaptability, with projects being regularly reviewed and adjusted based on feedback and changing market conditions. This can help organisations to stay ahead of the competition and quickly respond to changing customer demands.
Another key difference between the two approaches is the level of collaboration and transparency that is encouraged. Lean Portfolio Management promotes a culture of collaboration and transparency, with teams working together to achieve common goals. This can help to foster a more innovative and creative work environment, where ideas are freely shared and tested.
Traditional Portfolio Management, on the other hand, can sometimes lead to siloed working practices, with teams working in isolation and not sharing information or resources. This can hinder communication and collaboration, leading to inefficiencies and missed opportunities.
In conclusion, both Lean Portfolio Management and Traditional Portfolio Management have their own set of advantages and disadvantages. While Traditional Portfolio Management may be more familiar to many organisations, Lean Portfolio Management offers a more flexible and adaptable approach that can help companies to stay competitive in todays fast-paced business environment. Ultimately, the best approach will depend on the specific needs and goals of each organisation.