What is Agile portfolio management?

Because Agile portfolio management is based on the Agile software development methodology, it maintains a similar structure and shares many essential components. Vital factors in Agile portfolio management include:

Constant feedback and smaller, more-frequent releases targeting specific issues or changes allow organisations to operate with increased flexibility. Rather than working only on specific functionality subsets and only releasing changes incrementally, the iterative approach turns projects into works in progress, where the project itself is seeing constant improvement with every release.

The Agile methodology puts change management in the hands of the development teams themselves. This increases project velocity and allows for an increased number of cycles in a shorter amount of time. It also frees up change management teams to focus more on unexpected issues that may arise.

Organisations that employ Agile methodologies can constantly perform small, budget-friendly experiments to determine the viability of individual projects. These experiments monitor and test project elements throughout the project life cycle, and give teams the insights they need to adjust for emergent issues, pivot to meet changing goals, or even discontinue any projects that may no longer be viable.

Agile methodologies allow portfolio managers to reallocate funds as project priorities change. Continuous experimentation, as mentioned above, helps teams determine which projects are most valuable to the company, and thus which should be prioritised.

At its heart, Agile is about maximising the amount of work not done. Or, to put it another way, it’s about maximising the outcomes of the work that is done. Cutting away at unnecessary planning, determining which metrics are important and which are not, and then validating the project and its features based on those metrics, Agile allows teams to identify and remove extraneous features and unnecessary complexities, resulting in a more-simplified approach.

Agile is only effective when teams can collaborate seamlessly, and this is only possible when relevant goals, progress, and potential issues are readily apparent to everyone involved. Transparency in Agile portfolio management ensures that teams know what they’re doing, what others are doing, and how the projects are progressing overall.

Transparency has always been a vital component in project management. Traditionally, this transparency came at the cost of valuable project manager time and effort, with managers personally having to create detailed status reports whenever updates were needed. Agile project management frees up managers to do more with their time, while also providing all team members with shared purpose and real-time progress visualisation.

Agile project management dashboards provide organisations with visual boards capable of clearly displaying the current state of multiple projects and other portfolio-relevant data. High-level forecasts and estimates can also be refined based on actual data, to dial in estimates to better account for all available information. This makes it possible to retain complete transparency into company portfolios, even when faced with a growing number of projects.

Agile portfolio management places the responsibilities for tasks into the hands of teams, rather than individuals. These teams must understand the goals of the project as well as the overarching objectives of the organisation. But Agile does more than just place everyone on the same page; it allows teams to create their own culture while still aligning with the rest of the organisation on strategic vision. With goals set and business value properly defined, teams can determine for themselves the best course to achieve these goals. And, if strategic objectives shift, Agile gives teams the flexibility to pivot along with them and focus their efforts on new priorities.

Agile is just that: agile; it gives teams and organisations the power to respond swiftly and to alter course promptly to account for changing needs. With faster response times, projects can be updated with new data from customer responses. Outcomes can be driven by value, and goals can be built from market demand, rather than simply based on project delivery. Faster response times also allow organisations to minimise many of the risks associated with project delivery. Constant customer feedback keeps projects in line with customer needs and expectations, with change requests automatically incorporated into project backlogs. And, if the decision is made to redirect or even eliminate a project, these changes may be implemented quickly, before too many resources have been applied towards no-longer-relevant objectives.