Formation Chips, Impossible Choices and SPOFs

The chips are coming! 

Within portfolio management in government organizations and also the Public Prosecution Service formation chips are a special phenomenon. After a formation has been completed, these so-called 'formation chips' are sent to ministries and executive organizations. These often lead to change initiatives that must be implemented. The trick is to estimate these well and indicate when they can be picked up. The problem here is that it always has to be done quickly and preferably immediately. And sometimes the wishes are contradictory to developments already initiated within the portfolio, which makes it even more difficult.

Another challenge with these 'chips' is that it often puts extra pressure on the already overcrowded change portfolio. From the portfolio responsibility for feasibility you have to take this into account.

A simple starting point is that after the cabinet takes office (platform scene), these 'chips' will be transferred to the change portfolio within a year.

In short, in the already complicated portfolio environment within public organizations, you as a portfolio manager also have to take this into account.

My tip: Take into account now that you have to make room for this formation of chips in the coming 2 years and determine as soon as possible what the impact is. We have already started to make a mapping of the negotiation agreement on our change portfolio. An important indicator is the 'burn rate' within the portfolio. How much budget can you use versus available critical capacity. If the critical capacity is not increased in time, extra budget has no added value.

Impossible choices; stomach ache moments

'The change portfolio is full for the coming year', is a frequently heard statement within public organizations. And yet it must remain possible to pick up urgent (and there are many) change signals. With a lot of fitting and measuring it is incorporated, but there comes a point where it no longer works.

Then come the priority lists and scenarios to see how and what should be 'deleted or postponed'. These are often impossible choices, everything you do will hurt and has consequences for the primary process, legislation and regulations or political commitments. Real stomach-ache moments for portfolio management. Can this be prevented? No, unfortunately not, the only thing you can do is always have possible scenarios ready.

What I do in my practice is to proactively develop new scenarios from which you can choose.

My tip: Don't wait until it is that far, but make sure that you regularly proactively look at what new scenarios are. For example, based on expected extra demand or a different way of composing the portfolio. And discuss these regularly during quarterly planning or in the decision-making bodies. We make these scenarios based on expected developments and 'shocks' and 'waves'.

SPOFs we all have them Single Point of Failures (SPOFs), are those resources that are always needed in many prioritized projects. Think of key POs or people with a skill that is rarely available in the organizations. As a portfolio manager it is important to know who and how many SPOFs there are in the portfolio capacity planning. Often the idea of ​​managers is that capacity can be added, but that often has the opposite effect. The pressure on the SPOFs is increased and the extra capacity cannot be used effectively. This is also called the hourglass model. It is important to identify the SPOFs in the capacity planning, so that the line can create a development strategy to mitigate a SPOF. If you are going to make a plan as a portfolio manager, take the SPOFs into account and discuss with the line what can be done to reduce the pressure on SPOFs and how SPOFs will be mitigated in the future.

Portfolio management is a profession of looking ahead and being busy preparing the organization's change power for the future. Too often, Portfolio management is seen as making reports and quality control of project documents.