We've developed a deployment process flow for engaging management teams in effective new product portfolio prioritization using a 4-stage metric.
Each stage increases in degrees of sophistication. These levels permit groups to deploy the process at their level of readiness. Typical implementations see different groups in the organization at different stages. Our clients set a target date for all groups to reach Stage 4, they progress at their own speed gaining value at each stage. The framework provides a metric to measure progress.
The "maturity level" concept was conceived by Watts S. Humphrey and described in his book Managing the Software Process. Humphrey spoke about five levels of software process maturity (Initial, Repeatable, Defined, Managed, and Optimized).
He said that the levels where selected because they:Represent phases of evolutionary improvement, Represent a measure of improvement, Suggest interim improvement goals and progress measures, and Make obvious a set of immediate improvement priorities.
4-Stages of Deployment
The same measurement criteria can be adapted to our 4-Stage model for portfolio deployment. In fact, Humphrey's definition can apply to each of our four Stages of deployment. Here is an example of a tracking system to illustrate maturity levels; by stage for each of four product lines:
Portfolio Prioritized (fundamental): Prioritize portfolio using a common criteria. Fund above the line projects, delay/kill below the line projects, quarterly refresh.
Portfolio Rationalized (baseline): Rationalize portfolio using constraints to determine optimal mix of projects that maximize benefit towards reaching organizational objectives, delay/kill projects eliminated by constraints, monthly refresh.
Strategy Mapped (advanced):Align strategies (top-down) and rationalize portfolio. This stage introduces strategy formulation into the portfolio planning process where the as-is strategy is mapped and used to structure the portfolio model(s).
Strategy Aligned (best practice): Align strategies with goals and rationalize portfolio. This stage starts with using the mapping process to define strategy (should-be). The macro Vision/Goals/Strategies are aligned with the micro Projects in order to align projects with business direction. The strategy map is used to develop the portfolio prioritization models that include strategy priorities that drive project priorities.Top-down and bottom-up consensus is reached between general management and product line management about strategy and project/product direction.
Following, is an expanded map (by stage) to show the next levels of detail. Each implementation varies and the template is adapted, but the basic flow from simple to complex remains constant. Some organizations stop at Stage-2 (for example) and achieve measurable benefits while others move quickly to Stage-4. The speed of the deployment is a function of the desired improvement goals sought.