Portfolio management – CSPs financial agility
October 20, 2020
October 20, 2020
Our clients across the globe are embarking on digital transformation journeys. At some point all of them feel the need to become nimbler and able to react faster to changing customer needs – Lean Portfolio Management (LPM) is a way to foster this. Within LPM, financial agility is a core pillar and the backbone of an agile enterprise.
Today’s point of view of focuses on 3 levers to drive financial agility:
Today, functional silos and project setups guide budgeting. Tomorrow, resource allocation and controlling follows value streams and agile release trains aiming to enable a continuous value chain.
Lean Portfolio Management (LPM) is a multifaceted approach to embed agile ways of working deeply into your organization – inter alia and particularly business units adjacent to your IT organization. Thus, LPM and primarily financial agility must be a priority for any business and IT leader pursuing enterprise agility.
While basic agile transformations of IT delivery organizations are regularly done successfully, holistic enterprise agility is seldomly achieved.
Agile business processes, especially financial structures seem to be among the most challenging pieces on the way to unlocking enterprise agility.
The benefit of agile delivery can only come into full effect when combined with agile business processes. When newly introduced, agile ways of working allegedly cause a lack of transparency on business benefits achieved. LPM respectively financial agility is not only an enabler to enterprise agility but serves also as an instrument to create full transparency on value realization.
Managing and realizing value in an agile context is a key component of lean portfolio management. The non-linear value chains in the new, agile context require and update to our understanding of value and how to manage it.
Today, funding and cost accounting is project focused. Tomorrow, value stream budgets are adjusted dynamically, and participatory budgeting is applied.
Harvesting the value of enterprise agility through financial agility” cards?
Organizational structures in IT-near business units are aligned to the agile ways of working to unlock the added value of agile delivery.
Resource allocation along value stream reduces admin work and shifts the efforts into real value and impact discussion.
Tools like value realization office foster agile financing with transparency on benefits, entrepreneurial accountability and closed feedback loops.
Lean portfolio management offers a broad set of concepts to drive business agility and bring IT and business agile ways of working into sync.