How startups are changing portfolio management

Hi !

In this post I want to talk about how new companies, like startups, are changing the way portfolios and portfolio management is done.

What is portfolio management ?

The portfolio of a company is a collection of the products, services and achievements. The goal of a company portfolio is to create a presence of the business on the market, attract more customers and to show how the business differs from its direct competitors on the market.
Portfolio management ensures that an organization can leverage its project selection and execution success. It refers to the centralized management of one or more project portfolios to achieve strategic objectives. Our research has shown that portfolio management is a way to bridge the gap between strategy and implementation.

How are startups changing it ?

Start-ups are versatile and flexible. Those in charge of start-ups are constantly forced to decide what takes highest priority. It may include decisions like prioritizing profit or gaining more customers, which are the investors’ wish list or which are the important new projects that prepare the start-up for rapid growth.
In addition to all these important questions, start-ups usually have a short decision making processes. What used to take another company a month now takes a week, and what used to take a day is settled in an hour. For this reason, they increasingly focus on adaptive strategies in portfolio management, so that they can react as quickly as possible and avoid a standstill. If a great new project is with highest priority, they might wait until the next sprint to make changes, but they won’t wait until the next quarterly meeting. This is a radical idea when compared how big traditional business are managed.
A broad term of this practice is called Lean project portfolio management, which has as a goal to simplify traditional ways of managing portfolios.

Final Thoughts

I think these are exciting times in the IT industry. With startups challenging the way how business has been done, even with something so key as company portfolios. I think this new way of doing portfolio management will have a good impact, because it will streamline one of the most important assets for companies. In my opinion, this will make it easier to manage inside a company and clients will be able to reach it and understand it easily.