Whether the Portfolio in question comprises investments, projects or new product developments there is one thing they all have in common – the spreading of scarce resources to give the best possible return. Resources might be money when considering investment portfolios but when people are involved there comes the need to make sure they are the right people, i.e. they are suitably qualified and experienced.
The Office of Government Commerce’s recent launch of their Management of Portfolios (MoP™) publication was the opportunity for David Pritchard the Executive Director of the UK government’s Major Projects Authority (MPA) to outline significant changes to the assurance of government projects and programmes. The linkage between MoP and MPA is clear for all to see. The projects and programmes that will be overseen by the MPA will be considered and managed as a Portfolio. The size and scale of this Portfolio is however, huge.
David stressed the importance of defining the portfolio in the first place. In future large government projects and programmes (and those with a significant reputational interest) will fall into the Government Major Projects Portfolio (GMPP). These will have a combined value well into the hundreds of billions of pounds.
Stephen Jenner, joint author with Craig Kilford, outlined how the MoP was structured and how it might be operated in practice. The concept of two portfolio cycles, definition and delivery, joined by “Organisational Energy” is an interesting one.
Given how the UK government intends to use the Portfolio Management approach for its GMPP it will be intriguing to see how projects and programmes are categorized in the definition stage. In many ways these categories could be considered to be portfolios in their own right, perhaps even spanning government departments. Independent assurance and review of categories will no doubt be required to inform decisions made at the overall portfolio level.
As with all OGC announcements and new publications there is training associated with the new MoP document. Foundation Training will be available ‘soon’ with Practitioner Training coming along in ‘late summer’ 2011.
As anyone with only a passing interest in portfolio management knows it’s deciding what to include within the portfolio that is key. Just as importantly though it’s when to move items out of it when they no longer fit that is even more difficult. The finance world is extremely adept at this but it remains to be seen just how this will work within the public sector especially given the political sensitivity of some of the projects that will undoubtedly be included within the GMPP.