New product development is an exciting pursuit for any business. But poor visibility of its processes can quickly dull the shine.
New product development is an exciting pursuit for any business. But poor visibility of its processes can quickly dull the shine. Without a complete view of the project, product managers (PMs) face a higher risk of conflicting deadlines and resource allocation. This can lead to missed dependencies and bottlenecks—two phrases that give PMs nightmares.
It’s also not enough for each PM to only have visibility over their own product development projects. A full view of all projects allows PMs to understand if and where there are conflicting demands on resources. This is where a project portfolio management (PPM) tool can help.
PPM tools offer powerful data aggregation, analysis and visualization capabilities. By using one, PMs can see the entirety of the product pipeline as well as zooming into the details. This can grant you a serious edge when building business cases and planning projects if you know how to get the most out of your tool. But before we dive into the benefits, let’s start by recapping what PPM is and how it plays into product development.
What is PPM?
Project Portfolio Management (PPM) refers to the ongoing processes involved in analyzing and optimizing the strategic value of a project portfolio. It includes best practices for project management and the technology needed to facilitate delivery and reporting.
PPM aims to evaluate the strategic importance of projects as accurately as possible using high-quality project data. This data includes the relative use of resources and projected vs. actual profitability of previous projects. Overall strategic importance and previous project data can then inform decisions about resource allocation or whether to Go/Kill at a gate.
What is PPM in Product Development?
Product portfolio management — or product portfolio and program management — is an approach that allows you to prioritize and manage your product development programs. PPM in product development enhances visibility by creating a strategic, top-down view.
Much like PPM in project portfolios, PPM in product development also aids important decisions like project initiation and resource allocation with the help of high-quality data.
Upgrade Your Product Project Business Cases with PPM
Using the visibility that a PPM tool can provide over a whole product portfolio, PMs can strengthen their product project business cases. The advantages include:
- Quickly checking resource capacity: At a glance, a PPM tool can show you if resources are over or under capacity for live projects. This can influence resource planning for your product project business case.
- Identifying synergies: In some instances, there may be opportunities to synergize production and facilitate another project. A PPM tool can help identify these opportunities, often with the help of predictive algorithms. 3M is an example of how successful this strategy can be for scaling up. They produce over 60,000 products with varying formats and functions. They are able to achieve this by synergizing the production of key components such as adhesives. These can then be used across multiple product lines.
- Comparing projected ROI to current projects: Excel spreadsheets have served PMs well in the past, but accessing and interpreting the data can be tricky. This method can also leave PMs working with outdated data. PPM tools can help PMs track the real-time ROI of projects throughout the project lifecycle. This data can be used to help position your product project business case.
- Evaluating strategic impact: A significant advantage of PPM tools is the strategic view they provide across an entire product portfolio. This view can help PMs construct their business case by highlighting live projects that could benefit from the development of their product idea. It also allows PMs to spot potential conflicts between projects. They can then prioritize resources based on each project’s strategic value.
The Benefits of a Product Portfolio Management Tool
Implementing a PPM tool will require multiple teams to adapt their tech stack and behaviors. But the benefits for product development are worth their weight in golden opportunities.
Increased access to pre-project information
Nobody enjoys searching through email attachments or downloads for project documentation. PPM tools offer central, cloud-based storage for key pre-project information like the project business case. Teams can access it easily throughout the product development process to ensure they are still aligned with objectives at a project and business level.
Improved product strategy
Agile methodologies are now a staple for both project management and product management. As such, most PPM tools will facilitate the creation and management of Agile roadmaps for product development. Ideation and market trends still need the human touch of a PM. But once those are complete, your PPM tool can support quick shifts in the roadmap based on changes in the market and feedback on the product.
More effective resource allocation
Today’s economic uncertainties mean some PMs face a perfect storm of limited resources combined with increased pressure to rapidly roll out new, successful products. Resource allocation in these circumstances is challenging without a top-down view of priorities and team workloads. A PPM tool can provide this view to facilitate the allocation of resources to the most strategically important projects at the right time.
More realistic deadlines
“As soon as possible” isn’t a realistic or strategic approach to setting deadlines in the product development process. Historically, the scheduling process would be time-consuming and relied on a lot of estimation. Today’s PPM tools can shrink the time and guesswork involved in this process. Using data from previous projects and current team workloads, PPM tools can construct more realistic timelines.
Accelerated time-to-market
Speed is a crucial factor for the success of product development projects. Markets are increasingly competitive, in part thanks to the continuing uncertainty of the global macroeconomic landscape. This ramps up the pressure to launch fast and successfully. All of the previously mentioned benefits of using a PPM tool in product development can shave valuable time off the overall process. In addition, PPM tools can automate workflows, centralize change requests and facilitate communication between teams to further streamline the product development process.
How to Get the Most Out of Product Portfolio Management
PPM tools are becoming more powerful and sophisticated with the introduction of AI and machine learning (ML). But they still need to be piloted to get the most out of them. Here are some of the ways PMs can optimize their use of a PPM tool for the product development process.
Idea Management and PPM
Some say there’s no such thing as a bad idea, but in product development, it might feel as if there are too many ideas. PPM supports the visibility of an entire portfolio of projects, so organizations can better structure, nurture and evaluate product ideas. From there, PMs can begin the process of critiquing, problem-solving and prioritizing ideas for development based on:
- Strategic objectives
- Commercial viability
- Technical feasibility
- Resource capacity
- Risks
- Competitor and market data (such as the launch of a similar product or material shortages)
There will always be unknowns in product development. But you can expand your visibility to improve your strategy and increase your productivity with a powerful PPM tool.
Integrate PPM with Stage-Gate
Decision-making is simpler and faster with the right data. If your PPM tool is integrated with your project’s Stage-Gate process, it can provide you with relevant data for that stage to help hone the Go/Kill decision. This could include projected vs. actual costs, risks and resources, as well as value predictions based on previous project data. By integrating PPM with all project Stage-Gate processes, PMs can also re-evaluate the prioritization of projects at each gate and reallocate resources if necessary.
Use PPM to Become More Agile
Our ever-shifting economic and geopolitical circumstances are affecting rapid changes in markets and supply chains. If you run your projects using Stage-Gate, you might have had clear conditions for a ‘Go’ decision 6 months ago. But today, your competitor has unexpectedly launched a similar product and a major supplier has significantly raised their prices. This turn of events could dramatically change your Go-To-Market and budget priorities.
At a glance, your PPM tool can provide you with the information to make well-informed but fast decisions on how to adapt or pivot your project. Once your processes have reached maturity and you’ve implemented predictive algorithms, your PPM tool can also predict the impact of these decisions. This will further affirm your choices and help to reassure stakeholders.
