Resource Planning: The Key to Effective Portfolio Management – Part Two

/Resource Planning: The Key to Effective Portfolio Management – Part Two
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Resource Planning: The Key to Effective Portfolio Management – Part Two

In my last post, I discussed the three goals of effective portfolio management: value maximization, achieve portfolio balance (including short- and long-term value), and having strategically aligned portfolio. In this post, I will focus on the first of three approaches which can lighten the load and reduce the cost of defining these inputs, constraint management.

The key objective in this approach is to find the constraint or bottleneck and manage the constrained resource pool rather than all resource pools. The 80:20 rule applies well in resource constraints and it is often the case that there are one or two resource pools which are the genuine constraint. For example, in many companies the constraints are most often in the R&D or technical team and/or in the marketing teams.

In constraint management, traditional approaches to resource effort estimation are viable due to the smaller number of resources being managed. Good technical managers will often develop, (out of necessity), simple spread-sheets which provide an estimate of resource effort over time which is aggregated across projects. Despite good intent, these efforts are often frustrated by change. In the dynamic nature of the business world, projects are killed, put on hold, or accelerated while at the same time resources are redeployed or become unavailable for a variety of reasons. The key problem with this traditional transactional approach to resource management is that even when used intelligently across only the key resources, the effort to keep up to date in maintaining an accurate ‘spread-sheet’ system is unrelenting.

In my next post, I’ll discuss project classification and resource profiling, our second and third suggested approaches.

2016-12-14T21:01:01-05:00December 17th, 2013|

About the Author:

Gerard Ryan
Gerard Ryan is Managing Director and Principal Consultant of Prodex Systems Australasia. Gerard is also the President of Product Development and Management Association (PDMA) Australia. Gerard is an experienced keynote speaker, principal consultant and trainer in systematic innovation governance throughout the Australasian region. For over 15 years, Gerard has focussed on inspiring and empowering businesses to implement innovation systems to grow their businesses. Gerard is passionate about bringing leading best practices to Prodex clients and building long-term relationships. http://prodex.com.au/

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