What is the Primary Focus of Lean Portfolio Management?

Managing a product portfolio might feel like an acrobat juggling multiple plates.While balancing many projects at a time becomes more common as your career progresses, it can pose a risk of burnout and disorganization. Effective leaders should utilize Lean Portfolio Management to achieve success even when overseeing a number of products.

What is the primary focus of Lean Portfolio Management?

OrganizationsTeams utilizing Lean Portfolio Management (LPM) execute plans efficiently by hyper-focusing on priorities. The primary focus of Lean Portfolio Management is aligning agile development practices with overall business strategy. By keeping efforts and projects within the portfolio lean, teams can prioritize work that nets the highest value for customers. This ultimately creates a customer-centric vision, a key pillar for successful business. In a nutshell, LPM enables your strategy to steer your execution.

Why use Lean Portfolio Management?

Lean Portfolio Management is a great bridge between your strategy and execution. When teams implemented correctly, Lean Portfolio Management correctly, can helpthey reduce waste and driveexperience continuous improvement. Agile principles used congruently with LPM keep teams aligned and drivingen toward the most importantan end goal. Other types of portfolio management, such as Traditional Project Portfolio Management (PPM), Active Portfolio Management, Passive Portfolio Management, and Balanced Portfolio Management, are less flexible and adaptable.

What are the steps to implement Lean Portfolio Management?

Lean Portfolio Management requires a strategic approach to ensure teams use resources efficiently and achieve the highest value for customers. While content and strategies within LPM vary for different businesses and industries, they should share five steps.

1. Prioritize

Teams should identify projects or products that bring the most value and focus on the highest value tasks first. Lean Portfolio Management is all about trimming the fat, getting rid of unnecessary elements to the portfolio. By focusing on what matters first, teams allocate energy and time to tasks with the most significant impact.

2. Eliminate Waste

After identifying priorities, teams should remove anything that does not provide value. When teams streamline processes and eliminate unnecessary steps, balancing products becomes manageable. Teams will create more room to breathe and a space to focus on what truly matters to the company and consumers.

3. Stay Focused

Lean Portfolio Management helps eliminate distractions or shiny new tasks. Staying within a framework enables teams to stick to a plan, adjust only when necessary, and not get sidetracked over unimportant things.

Imagine you’re working on a big DIY project, like building a bookshelf. You’ll never finish the shelf if you keep getting sidetracked by the latest tool or fancy paint color. Instead, you stick to your plan: assembling the frame, then adding the shelves, and only making changes if something isn’t working right. Similarly, Lean Portfolio Management helps you stay focused on your main goals, so you don’t get distracted by every new idea that comes your way. This ultimately keeps teams moving forward efficiently.

4. Collaborate

We see the power of LPM when teams collaborate, share insights, and adjust plans as necessary. This dynamic is akin to jazz musicians improvising a perfect tune. When teams listen to one another and share knowledge, they solve problems and spark innovation.

5. Adapting and Keep Improving

Lean Portfolio Management is not a set-and-forget approach. Like a gardener tends to a plant, teams must review and tweak portfolios to keep it thriving. By adjusting business strategies within LPM, teams convert chaos into calm, becoming more effective and delivering better results.

Earning an ICP-LPM certification can help you develop a comprehensive understanding of Lean Portfolio Management. Hyperdrive’s Lean Portfolio Management course covers prioritizing investments, managing work in progress, LPM application to business agility, and creating a system that flows.

What principles and practices are part of lean portfolio management?

Teams should tap three principles when implementing a lean approach to portfolio management. This framework keeps a team’s efforts focused, streamlined, and adaptive.

Align execution to strategy Teams utilizing LPM should ensure all projects and initiatives within the portfolio are directly tied to the company’s broader goals. Teams should use tools like Objectives and Key Results (OKRs) or strategy maps to clearly define priorities and communicate them across the organization. Regular check-ins ensure resources are focused on delivering maximum value, and any misaligned efforts are quickly adjusted. Alignment fosters transparency and avoids wasted efforts on low-priority work.

Funding and budgeting Lean Portfolio Management emphasizes dynamic funding models rather than rigid annual budgets. Instead of locking resources into predefined plans, funding is allocated iteratively to the highest-value initiatives. Teams can use techniques like rolling-wave planning or participatory budgeting to make real-time adjustments based on changing priorities and market conditions. This flexibility ensures that resources are continuously directed where they’ll have the greatest impact.

Governing and measuring LPM Governance in Llean Pportfolio Mmanagement focuses on creating lightweight controls that support agility without stifling innovation. Teams establish clear guardrails and decision-making criteria to maintain accountability and compliance. Measurement is equally crucial; by leveraging metrics like lead time, throughput, and value delivered, teams can evaluate the effectiveness of their portfolio decisions. Continuous feedback loops and regular reviews ensure the portfolio evolves to meet organizational objectives efficiently.

Key Takeaways

In today’s corporate culture, teams and individuals constantly grapple with juggling more and more responsibilities. Lean Portfolio Management is essential for taking on multiple projects or initiatives. By focusing on efficiency and value, teams ensure resources are used where they make the largest impact and reduce waste. Regular reviews and adjustments help a team stay on track but flexible when working toward a goal.