The PMO community have often discussed the problems in portfolio management surrounding planning. If only if was so simple to effectively plan a portfolio of programmes and projects which fit neatly into an organisation’s financial year – life would be so much simpler but alas no. In this article, Carina Hatfield tells us about a new ebook which is available to download which covers this exact problem and covers something called continuous planning which should be something every PMO is interested in finding out more about.
Improve Agility Through Continuous Planning
There is no avoiding it. Budget season. Annual planning comes around every year and there is one thing you can count on – it will change. Projects get delayed, uncertainty eventually leads to new information, priorities shift, and new unplanned demand leads to unrealistic forecasts since it’s hard to intentionally shift away (let alone kill a project) from the annual plan.
Annual planning is beyond frustrating to the organization since detailed annual plans require a tremendous effort and then results in bureaucracy. Let annual planning be a top down budgeting exercise it should be and shift your organization to a continuous planning model that will reduce bureaucracy, improve your plan’s accuracy, drive agility, and improve portfolio management. You are probably a strong candidate for continuous planning if you struggle to answer these questions:
- How do changes affect the overall project portfolio?
- Are they going to result in a more balanced portfolio that allows us to focus on increasing innovation, or improving business capabilities?
- Can we make trade-off decisions when faced with constraints?
- Are we able to reallocate funding and resources effectively throughout the year?
To drive effective portfolio management, it is important that you have an updated forecast for in-flight projects and new demand. However, even quarterly updates are probably insufficient in today’s dynamic business environment.
In Ventana Research’s new ebook: Improve Agility Through Continuous Planning, they discuss how regular reviews to the portfolio plan can help you adapt to change, evaluate project status and priority, track performance, and adjust schedules and resource capacity forecasts. They say it is critical to revisit the plan often to support changing business needs and new market demands.
Another consideration: many initiatives tend to begin and end in different fiscal years. If projects and corporate initiatives span multiple fiscal years, it’s important to extend planning beyond the annual budget.
Here are some more takeaways from this new study and ebook by Ventana Research, sponsored by Planview:
- 58% of those working in companies with 1,000 or more employees say spreadsheets are a stumbling block in their planning process
- 85% report more effective planning and better decision-making when they integrate operational and financial planning with long-range planning
- 66% with integrated plans can respond with more agility to changing business environments
- 49% who integrate current and longer-term planning are more able to explore a range of future scenarios
While many companies can plan projects accurately, many do not. The survey also showed:
- 91% say improving plan accuracy would be valuable to their company
- 56% say improving accuracy is the main reason to change a company’s planning process
So how do you start thinking beyond the annual plan? First, you need to open up a dialogue between the business functions – including finance, the PMO, and other lines-of-business. Ventana Research suggests:
Address the challenge with the right technology: Since larger organizations are having more difficulty planning in spreadsheets, consider alternative technologies that will support continuous planning, such as portfolio management with investment and capacity planning features.
Make better business decisions together: Because organizations make better decisions when they can see operational (demand and resource capacity) with financials – the business needs to visualize the same information to make decisions.
Adapt to change: When operations and finance have access to the same information, they can be flexible when it comes to change, not sidelined.
Ultimately, the PMO can create and nurture a partnership with finance and the business to drive prioritization and effective portfolio management. The win-win: this new-found agility will lead to an increase in on-time projects, lower costs, and added value.
Ready to support a more continuous planning process for driving innovation, faster time to market, and wiser resource allocation? Find out now — get your copy of the ebook, “Improve Agility through Continuous Planning,” by Ventana Research for research and insights into Next-Generation Business Planning.
Carina Hatfield always has a plan. During the years, she has improved her ability to respond and re-prioritize for new ideas and unplanned events. She followed her original plan of becoming a CPA going into budgeting, forecasting, and strategic planning until a new idea was prioritized to join Planview Enterprise. She joined product management after implementing Planview Enterprise to help organizations improve their strategic, forecasting, and planning processes for 6 years.