Modern Business Management: An Economic Necessity
If you ask any executive whether their organization is modern, they’ll tell you of course it is. No leaders want to admit they are leading something that is a little behind the times, outdated or perhaps even obsolete. However, if you ask those same leaders what it is that makes their organizations modern they’ll struggle to provide tangible examples of their modernity. At CA we believe that’s a problem, and we also believe modern business management can be defined.
Business today is constantly evolving and adapting, technology and customer demands are driving the need for ever faster responses to challenges, and organizations that cannot pivot immediately to leverage new opportunities will find those opportunities lost. That kind of business environment cannot be managed in the same way as the relatively stable business models of the past that were subjected to fairly significant shifts on only an occasional basis. Instead, organizations must manage for constant evolution—with much smaller changes on a much more frequent cadence—with the assumption that organizational stability is an outdated notion. Modern business management must therefore combine the concepts of enterprise agility with rigorous portfolio management to ensure the value being delivered is always optimized.
In practical terms this means a much closer integration between leadership and the frontline of project delivery. The amount of time it takes for decisions at the executive level to reach the project delivery level and be translated into action must be minimized, as must the time needed to get performance data translated into decision support information for leaders to leverage. This is where portfolio management truly delivers value, applying agile principles to improve organizational performance. Here are a couple of examples of that application in action:
From a leadership-down perspective, portfolio management must be closely integrated with executive decision making, with awareness of when environmental changes drive the organization to shift goals, objectives or priorities. Portfolio management must then be able to translate that shift into project-level changes for project managers and teams to implement effectively and efficiently, pivoting with minimal disruption to ensure they are optimally aligned with the goals and maximizing return on investment. This can only occur when portfolio management has complete and accurate visibility into the portfolio, from investment management to project performance, and when that visibility crosses waterfall and agile projects.
From a project-up standpoint, portfolio management must focus on creating an environment that allows project managers to make decisions around changes they feel are necessary for their initiatives, with the information required to be confident that their choices are the right ones. It is all very well to allow project managers to “ask for forgiveness, not permission” around the changes they drive, but this can only succeed if project teams have a complete picture of not just performance against business objectives and customer goals, but also how they can influence that performance with their actions. Here again the combination of agile and PPM suites provide the information, and portfolio managers add the context required to interpret that information.
In upcoming blog entries we’ll explore these concepts in more detail and consider how modern business management is transforming the role of portfolio management and the modern PMO.
To learn more about Modern Business Management, download the “Modern Business Management for the Adaptive Enterprise” paper.