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Portfolio Vision: an Essential Start to Delivering Change
Why portfolio vision is a must before investing in change that creates meaningful value
Cliff Oguzie
October 28, 2024
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Have you ever worked on a project where you’ve wondered why it was even started in the first place? Maybe you’re responsible for business outcomes and need to bring together a number of teams to drive those outcomes, but not sure how to begin?
I’ve experienced both situations and have always gone back to a portfolio vision to define meaning and purpose for what my team are responsible for, and to decide where best to apply scarce skills and resources.
Table of Contents
Intro
It can be very difficult to explain to a project delivery team why their work even exists and where it fits in the overall narrative of the business or organisation. This can lead to lack of motivation or belief in the work they are doing.
I avoid this by relating the work back to a portfolio vision and outcomes that are compelling enough to enable teams to feel inspired to achieve challenging objectives on a daily basis. A portfolio vision is a great way to start telling a compelling story to teams of why work needs to happen.
Whilst working with executives who are challenged to achieve these outcomes, it has also been difficult to articulate what problems need solving and how they can be measured. It can therefore become challenging to release necessary funds, or prioritise work.
This often leads to work being initiated because it feels like the right thing to do (i.e. it creates revenue or maintains compliance), but delivering a collection of projects that are in some way beneficial does not help with decision making when tradeoffs are required, and certainly doesn’t help to ensure resources are utilised efficiently to gain a competitive advantage.
You may be reading this and are thinking “this doesn’t apply to me, portfolio visions are only for large enterprises with huge budgets and many departments”. Actually a startup or small department can also benefit, as the challenge of considering where to invest effort and resources exists regardless of size. The key difference is the scale at which the work is applied once identified.
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Translating Vision
What is a portfolio Vision? Similar to the vision of an organisation, a portfolio vision describes the future state of what a large scale amount of work will achieve.
This could be the entirety of a small businesses goals for the future, or a departmental approach to delivering it’s part of the wider company vision.
A portfolio, can be described as a collection of initiatives typically structured as programs, work streams, projects and epics, for example. The common thread is that they achieve common strategic outcomes.
Some time ago, I worked alongside departmental leaders to develop business model canvases. The aim was to help shape the change agenda for their departments, so that programs of work could be established and funding obtained to deliver them.
This was a useful exercise, as it helped us to understand the relationships we needed to establish to manage dependant work, articulate connected streams of work, start the discussions around resource and start thinking about benefits.
Whilst it was useful, I did feel there was something missing.
I concluded that Business Model Canvases are great for articulating work to improve or establish a new business, but less helpful for articulating how the work can be thematically organised, and how success can be measured from the outset.
Enter…Portfolio Canvas
The Scaled Agile Framework team must have had similar thoughts to me, as they took the Business Model Canvas and expanded it to create the Portfolio Canvas. What are the key differences?
Value Steams
Initiatives are now structured into streams of work such as development that can be linked logically to the operational value they enable. It also helps to start thinking about how teams can be organised.
KPIs
It is always important to highlight from the outset the metrics to assess whether each work stream is achieving success or not. This enables early thinking about the types of work to invest in before it starts.
Solutions
Throughout my career, I’ve been told never to think about solutions before identifying the problem, as it could end up solving the wrong problem. I stand by that, however in this instance the addition of solutions can be helpful, as it describes the characteristics of what can solve the problem, not necessarily the technology itself.
Including solutions can also help with early stage identification of existing projects or solutions, which may already contribute to the KPIs that need to be achieved.
Are you working as part of a portfolio team and don’t have a Portfolio Canvas? You can download a blank copy from the scaled agile page to create your own.
To help make life a little easier for you, I annotated the example below with some quick summaries of what is being asked for in a Portfolio Canvas.
Portfolio Canvases translate vision into actionable work, and can be used by enterprises, small businesses, portfolios and scrum teams.
They are the original source that trace the work to be done, to the value it creates, and connects all related work into a compelling story of future success.
Example
Here is an example vision and Portfolio Canvas for a fictional software company, seeking to drive growth in the small to medium size market, seeking to take market share from it’s competitors.
Strategic Vision: "To be the go-to software provider for small and medium-sized businesses, driving their growth through innovative, user-friendly solutions.
Value Streams:
Custom Software Development
SaaS Products
IT Consulting Services
Solutions:
ERP System for SMBs
Cloud-based Project Management Tool
Customer Relationship Management (CRM) Software
Cybersecurity Suite
Customers:
Small and Medium-sized Businesses (10-250 employees)
E-commerce Companies
Professional Services Firms
Local Government Agencies
Channels:
Direct Sales Team
Online Marketing (SEO, PPC, Social Media)
Partner Referrals
Industry Conferences and Trade Shows
Customer Relationships:
Personalised Account Management
24/7 Technical Support
Regular Check-ins and Quarterly Reviews
Customer Success Program
Budget:
Product Development: 40%
Sales and Marketing: 30%
Customer Support: 15%
Operations and Administration: 15%
KPIs / Revenue:
Customer Acquisition Cost (CAC)
Customer Lifetime Value (CLV)
Monthly Recurring Revenue (MRR)
Net Promoter Score (NPS)
Churn Rate
Revenue Growth Rate
Key Partners:
Cloud Service Providers (e.g., AWS, Azure)
Payment Gateway Services
IT Consulting Firms
Local Business Associations
Key Activities:
Software Development and Innovation
Sales and Marketing
Customer Onboarding and Training
Ongoing Customer Support
Market Research and Product Improvement
Key Resources:
Skilled Development Team
Sales and Marketing Professionals
Customer Support Staff
Proprietary Software Platforms
Cloud Infrastructure
Cost Structure:
Employee Salaries and Benefits
Software Development Tools and Licenses
Cloud Hosting and Infrastructure
Marketing and Advertising Expenses
Office Space and Utilities
Revenue Streams:
SaaS Subscription Fees
Custom Software Development Projects
Implementation and Training Services
Maintenance and Support Contracts
Consulting Fees
Resources
Book:
Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Authors: Alexander Osterwalder, Yves Pigneur
Related articles:
That’s it for this edition, for more delivery leadership insights, subscribe to the Change Leaders Playbook podcast series on Youtube, Spotify, Apple and Audible.
Cliff 🫡
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