I think we can agree that often the problem with developing killer products isn’t with idea generation. We have lots of good ideas entering our pipelines. The problem comes down to execution. We lack the insight to understand resources and when there’s a hiccup with resources, you can bet it’s going to be bad when it comes to execution.
Even if you think you have resource management down, wouldn’t it be great if you could make sure everyone is working only on the best projects? They simply cannot work on every project that come into your pipeline. That wastes not only their time, but significant dollars – not to mention that for every resource working on a doomed project, that’s one less resource working on the next greatest product. It’s a compounding issue that can inflict quite a bit of collateral damage.
Effective planning requires two things:
- Picking the right projects
- Do them right
Here are four tips to get you there:
Tip 1: Prioritize good projects and align them with strategy
It’s not just about weeding out the bad projects from the good, it’s also about prioritizing the good projects, aligning them with the strategy and speeding them to market. This is the difference between effective planning versus simply hoping it will all work out. Trust me – it rarely ever just all works out.
Tip 2: Plan for the short term as well as the long term
Your portfolio should balance projects and products based on these strategic needs. Revenue and resources are important, but there are many other considerations, such as impact on the environment, impact on the brand, technical viability, strategy, experience, and ability to play in the marketplace.
Access to this information allows you to maneuver and align your execution with your ongoing strategy.
Tip 4: Be able to perform “what if” analyses to understand tradeoff decisions quickly as the market changes, the competition launches a new product, etc.
You’ll always be limited by capacity (your people and your money). The trick is to be nimble enough to pivot in terms of which projects you prioritize with which resources and funding. This means you may need to put a project on hold while you focus on the projects you know you can move forward.
Increasing Revenue Through Higher Value Projects – How to Mature Your Current State
Industry analysts have noted that without using a purpose-built tool portfolio management software, an average of 10 percent of budget is allocated to lower-value projects. That means the value of your portfolio goes up 10 percent! If single digit growth number is praised, a whopping 10 percent is worshipped.
At Planview, we have seen this play out in even greater numbers. One customer shifted 20 percent of their sustaining engineering spend into higher value, new product development programs after implementing PPM. Another improved innovation capacity by 19 percent after discovering project estimation inaccuracies that represented an over-allocation of resources to non-key projects.
Improving Time-to-Market Through Process Efficiency
Industry analyst noted that companies who implement a PPM system and good governance practices are 28 percent more likely to deliver projects on time.
One of our consumer product customers reduced their time to market by 70 percent, from 150 days to just 45 days. A high-tech manufacturing customer accelerated the development of a new product by 12 months. Benefits like these are huge and illustrate just how important it is to pick not only the good projects, but to focus on picking the right projects.
It’s truly a compelling message, and definitely able to achieve! See for yourself by listening to watch this real-world customer story featuring Henkel and how they implemented an innovation strategy to improve product delivery. It goes into detail on how they improved transparency to pick the right projects and kill the bad projects early.
I’d like to hear from you. What is your current method for prioritizing projects within your product portfolio? What are the weaknesses? How are you improving time to market and maximizing resources, funding, time? Share by leaving a comment below.