Portfolio Prioritisation v Balanced Optimisation
Prioritisation is the default technique assumed for planning portfolios of projects: indeed it is often used as a synonym for optimising a portfolio. Yet it is a technique that is limited in important aspects …and there are alternatives.
Organisations that today apply Portfolio Management techniques for planning their investment in projects frequently rely on Portfolio Prioritisation to select between projects that compete for finite funds, resources or time. However, although prioritisation, as a technique, clearly has benefits, it also has serious limitations.
Easy to understand
Plenty of scope for application of personal judgements
Perceived as flexible and consistent with the quality of the estimates for costs, resources and benefits that are available.
The approach is one dimensional so cannot reflect multiple objectives discretely or thoroughly
Multiple constraints are difficult to handle. What do you do after the first constraint is reached?
No help is provided when considering project scheduling – when to do a project within the programme timeframe
It is difficult to incorporate relationships between projects or options for individual projects
It is difficult to convey the basis for decisions by comparing the priority of one project to another and achieve agreement and acceptability
Prioritisation score is perceived to be subjective and often challenged or not respected
Achieving agreement can be contentious and lengthy involving re-doing scoring on changed basis and eventually never reaching firm clear decisions
Changes are hard to handle. New business directions or balance require a major re-calculation of all priorities.
Balanced Optimisation using Promantic™
Balanced Optimisation, as applied by VPI Partners, is delivered through our Promantic™ application and approach. Promantic™ provides a sophisticated and powerful form of analysis that uses the concept of Balanced Optimisation. The positive benefits are:
It can relieve contention or disputes about priorities
It enables an optimal programme to be calculated, so genuinely increasing value
It can handle complexities fast: allowing scheduling as well as choice, multiple resource constraints, project relationships
It gives total portfolio view. It can drive decisions to be derived from scenarios related to strategy
It gives a better answer, in terms of estimated total benefits.
…and if you want to adjust the results directly then the additional capability is provided with immediate indication of the impact on constraints and benefits.