In the last blog in this series, we introduced three challenges companies face that are often symptomatic of poor solutions’ portfolio management. In this blog, we want to delve into the first challenge in more detail – a striking majority of organizations lack a dedicated resource who is responsible for owning the portfolio for the entire organization – and provide insight on the critical role of a Solutions Portfolio Manager.
Most companies have numerous ongoing solution development efforts and initiatives spread across different departments and business units, each pursuing their own objectives. While generally speaking, initiatives can exist in harmony, solutions are also often competing with one another – for resources, internal and market mindshare, etc. – or even overlapping. Challenges arise when there is disconnect in the business and a lack of portfolio governance and overall management to determine what solutions should be prioritized, what efforts can be combined, and what should be delayed.
Unfortunately, despite the proven ability of the Portfolio Manager role to drive outcomes for organizations, only 50% have a dedicated Service Portfolio Management team[i]. Solutions that are in high alignment with companies’ overall goals and strategies have a 15% higher success rate of meeting said goal[ii], as well as an increased rate of staying within budgets and being delivered on-time. For many organizations, the responsibilities of a Portfolio Manager are doled out among different executives and spread across others throughout the organization; true company/portfolio alignment requires a dedicated resource or team of resources who are aware of all initiatives and own the portfolio decisions. The solutions’ portfolio is critical to organizational success. Therefore, the role of Solutions Portfolio Manager is best not filled by a consortium and entails a number of key responsibilities:
Maintaining Market Awareness and Alignment
This role is responsible for gaining a deeper understanding of the different target markets by sourcing expertise, so it can help define the markets to target, the buying personas that should be engaged, and what those markets and buyers need. In order to accomplish this, the Portfolio Manager must work to facilitate feedback by engaging different teams, including account executives, sales solution architects, strategic marketing, sales specialists, and services delivery teams. Through these regularly scheduled feedback meetings, the Portfolio Manager can proactively evaluate initiatives through the big picture lens of market strategy to anticipate changes and challenges before they arise.
Understanding the Solution Lifecycle
Another responsibility of the Portfolio Manager is to consistently evaluate the lifecycle for each solution to know when to retire a solution from the portfolio. Every product and service has a lifecycle, from the conception of the idea to the eventual discontinuation. The Portfolio Manager should ensure that time and resources are being funneled to high-priority solutions. By making strategic decisions around when to retire a solution, the Portfolio Manager can reserve critical resources for other timely investments that are more aligned with current and future market needs.
Prioritizing and Approving New Products, Services, and Solutions
In organizations that excel at this, for any new offer to go to market, it must be directly approved by the Portfolio Manager at various tollgates that give a go/no-go decision for each stage of it being developed, marketed, sold and sold at scale. This ensures that every new addition to the portfolio stays aligned with the organizational strategy and objectives and fits into the organization’s point of view of the future marketplace. A Portfolio Manager facilitates conversations between business units, functions, etc. to understand solutions and their potential impact on the portfolio and broader organizational goals. This process is often formalized through request forms and regular meetings. Making strategic decisions requires the Portfolio Manager to integrate information from the market and across all parts of the business to evaluate the solution based on a set of predefined, weighted criteria. For example, a solution’s strategic impact, market attractiveness, investment requirements, and sales and delivery potential. The role’s primary responsibility is ensuring that individual solutions, and the portfolio as a whole, help the organization get closer to the customer and support the organization’s broader strategic and financial objectives.
With the role of the Portfolio Manager defined, we can dig deeper into understand why companies struggle to identify the symptoms of poor portfolio management. The next blog in the series will explore how to identify and address underlying portfolio issues.
Written by: Anthony Paluska
About the Author: Anthony Paluska is a Partner at McMann & Ransford with experience helping organizations overcome commoditization by developing stronger, more intimate, relationships with their customers. He has leveraged his management consulting, problem-solving, and change management skills to support 15+ Fortune 1000 organizations, across a multitude of industries.