Explore Alternate Portfolio Plans

A portfolio plan is a subset of your portfolio data that allows portfolio managers and portfolio stakeholders to explore the alternatives for your portfolio investments using a "what if" environment. As a portfolio manager, you want to evaluate portfolios and plans and understand how the portfolios are executing against the plans. With the larger content defined in a portfolio, you can create specific plans within the portfolio horizon. You can use these plans to work with subsets of the portfolio content in a focused manner.
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A portfolio plan is a subset of your portfolio data that allows portfolio managers and portfolio stakeholders to explore the alternatives for your portfolio investments using a "what if" environment. As a portfolio manager, you want to evaluate portfolios and plans and understand how the portfolios are executing against the plans. With the larger content defined in a portfolio, you can create specific plans within the portfolio horizon. You can use these plans to work with subsets of the portfolio content in a focused manner.
To explore different options, you can create versions of a plan by changing the parameters of the original plan. Ultimately, you can approve a plan as the Plan of Record or the plan that you want to use and implement.
Example: Portfolio Planning Process
The Office of CIO at Forward Inc. regularly reviews their current plans within the overall IT portfolio. As part of typical business cycles, they explore alternate scenarios for how they can use the IT budget and resources to accomplish their portfolio objectives. Depending on the nature and size of the recommended changes, the CIO staff adopts this approach during the plan reviews:
  • For small and focused changes, they consider implementing those changes immediately, provided the changes support existing goals and only small changes to operational plans. For example, pushing out an investment start date by two months, or placing an investment on hold due to current project overruns and resource constraints.
  • For more extensive changes that require extra review, they capture these changes in named versions of plans or scenarios. They circulate these scenarios to the stakeholders and collect feedback in a more formal and disciplined review process. For example, an annual planning process can involve two formal review cycles. The first review is with the IT leadership team. The second review is with the Executive Steering Committee made up of senior leaders from major divisions of the company.
Follow these steps:
Verify the Prerequisites
To explore alternate plans for your portfolio, complete these steps:
  • Review the
    Portfolio Management
    article and set up the required data in the product.
  • Create the portfolio content for which you want to do alternate planning.
  • Verify that the existing portfolios reflect all the approved and proposed work for a given department. Some of the proposed work can exist as unapproved projects and ideas.
  • Associate the investments with costs and resources and populate them with the required information.
  • Install and apply the PMO Accelerator add-in for viewing the portfolio reports that you can use to compare your portfolio plans. For more information about how to install the add-in, see
    PMO Accelerator
    .
Create a Plan within a Portfolio
To work with a subset of your portfolio data and explore the alternatives for your portfolio investments, create one or more named plans. For example, you can create these plans for the IT Investments portfolio that spans a planning horizon of three fiscal years.
  • FY13 One-Year Plan for IT
  • FY13 Three-Year Plan for IT
To create a plan, modify the following parameters that you predefined at the portfolio level:
  • Start and finish dates. The start and finish dates of the plan as a subset of the portfolio horizon. For example, if the portfolio horizon spans Jan 1, 2014 to December 31, 2015, you can create a one-year plan from Jan 1, 2014 to December 31, 2014.
  • Default planning targets. The cost, resource, and benefit targets for the planning period as a subset of the portfolio targets. For example, if you are planning for only one year, you can reduce the targets accordingly.
Example: First Round of Planning
The office of CIO at Forward Inc., is conducting an annual IT portfolio planning meeting with the staff. The portfolio manager who is also the portfolio planner attends the meeting to capture and reflect planning options that the team is considering. In the current planning session, the team is considering projects that they want to fund as part of the PMO portfolio. To prepare for this meeting, the portfolio manager creates the 2014 IT PMO Plan to reflect this work:
  • Projects that are currently started.
  • Projects that have not yet started but that are approved.
  • Projects that are unapproved but that have a proposed start during the planning horizon.
  • Ideas that are not approved but have a proposed start during the planning horizon.
Follow these steps:
  1. Open Home, and from Portfolio Management, click Portfolios.
  2. Open the portfolio for which you want to create a plan.
  3. Click Plans and then click New.
  4. Complete the requested information.
Generate Versions of the Plan or Scenarios
Modify your plans and save them as alternate versions or scenarios. You can generate alternate versions of a plan by potentially changing the portfolio targets, content, and specific investment attributes (for example, dates, status, resources). For example, copy a plan and create another version by reducing the cost by a specific percentage.
Example: Generating Plan Versions
At a planning meeting with the CIO staff, the IT portfolio manager at Forward Inc. selects the 2014 IT PMO Plan. The portfolio manager presents the Waterline view for the plan to show these details to the staff:
  • All projects and their current ranking.
  • The project demands as they compare to the targeted constraints for costs, resources, and benefits.
  • The capital costs, engineering resources, business analyst resources, and project management resources as they are compare to the targeted constraints for costs and resources.
The staff reviews the priority list and makes these observations:
  • Out of the $20 million targeted cost budget, they have $15 million worth of projects currently above the waterline or funded.
  • Out of the $30 million benefits they are targeting, their funded projects only represent $20 million worth of benefits. The funded projects appear above the waterline in the view.
  • Out of the 70 resources available for project work, they have already committed 60 to the funded projects.
The CIO speaks about how employees must use resources more efficiently and must work toward accomplishing these business objectives:
  • A company initiative to reduce costs by 10 percent by outsourcing 20 percent of the staff. IT is committed to this target.
  • The need for IT to be more strategic. The Sales team wants to invest in a new SaaS (software as a service) sales solution. The solution costs $6 million and there is only $5 million left in the IT budget. The new solution promises an extra $10 million in benefits that can help meet the benefit target.
  • The Finance team has just delivered a mandatory project that costs $ 500,000. The project does not produce any benefits but meets a regulatory requirement for the company to stay in business.
The portfolio manager creates another version of the plan by copying the 2014 IT PMO Plan and renaming it to "Option One: 10 Percent Cut plus CIO Commitments". In the new plan version, the portfolio manager makes these adjustments:
  • Reduces the target cost by 10 percent in the distributed target.
  • Changes the mix of planned IT resources so that 20 percent are outsourced.
  • Changes the staffing of roles from local roles to outsourced roles to reflect the desire to outsource.
  • Moves the mandatory finance project above the waterline, consuming $ 500,000.
  • Approves or moves the SaaS project above the waterline, consuming $6 million.
The portfolio manager reviews the new version of the plan with the CIO and staff. Together they observe that the department is still $1.5 million over their cost target but is meeting their benefit target. Also, they are still missing their local and outsourced targets. They make these changes to the plan:
  • Move the low priority, Web-Based Benefits System project below the waterline, freeing up $1 million in costs and four resources. Now they are only $ 500,000 over the budget.
  • Outsource 20 percent of their work and close the gap between their local and outsourced targets.
  • Assign the task of creating new resource plans and cost plans with the new resourcing targets to the PMO director.
The portfolio manager saves the changes to the plan and notifies the staff. The CIO likes the new plan but expresses that they are doing business in the reactive mode. If the IT group can focus more on the strategic opportunities in the company, they could add much more value to the bottom line. They can make a bigger impact by generating more funds. For example, there are two small projects on the list, a Contact Management initiative and a Sales Compensation Transformation proposal. The projects are relatively low in cost ($1.3 million), but they promise a $13 million return on the investment.
Based on the CIO inputs, the portfolio manager creates another version of the plan named “Option 2: Increase Budget and Strategic Work with Significant Impact”. In this version, the portfolio manager makes these adjustments and shows the new plan to the CIO:
  • Increases the high-level target for cost as defined in the portfolio properties by $2 million.
  • Raises the high-level target for benefit as defined in the portfolio properties by $13 million.
  • Moves the Web-Based Benefits System project that the team previously decided to suspend below the waterline freeing up $1 million.
  • Moves the mandatory finance project above the waterline, approving it and consuming $500,000.
  • Moves the SaaS project above the waterline, approving it and consuming $6 million.
  • Adds the two strategic projects that the CIO mentioned above the waterline, consuming $1.3 million in costs and adding $13 million in benefits.
Follow these steps:
  1. Open Home, and from Portfolio Management, click Portfolios.
  2. Open the portfolio for which you want to create a plan version.
  3. Click
    Plans
    .
  4. Select the plan for which you want to create a version and click Copy.
  5. To create a different version of the plan, rename the plan.
  6. Edit the plan properties that are based on the new requirements.
Designate the Plan of Record
The plan of record (POR) is the portfolio plan that you intend to use for the portfolio to implement future investment changes. As you explore different options for a portfolio, you can refer to previous versions of the plans or scenarios that you have considered. Once you decide to pursue a given plan, adopt that plan and all its changes as the POR.
Example: Selecting the POR
Through the planning and review process, the portfolio planning staff at Forward Inc. quickly sees that the Option 2 plan is preferable. Compared to Option 1 plan, Option 2 plan offers these advantages:
  • Higher ROI
  • Greater benefit per resource
The staff gathers other important data using other portfolio plans to make their case for pursuing Option 2 as a better choice.
The CIO reviews the options with the Executive Steering Committee and recommends Option 2 as the path going forward. Once the executives see the data, they agree that Option 2 makes the most sense. The CIO communicates the change of plans to the portfolio manager. The portfolio manager designates the Option 2 plan as the POR for the portfolio.
Follow these steps:
  1. Open Home, and from Portfolio Management, click Portfolios.
  2. Open the portfolio for which you want to designate a plan of record.
  3. Click Plans.
  4. Select the desired plan and click Set Plan of Record.