Relating Portfolio Management to Strategy
When asking small and medium enterprises about how they select their portfolio, it can be surprising to observe that the CEO’s intuition is a common “method” to select the projects in which they will invest. According to PDMA’s Body of Knowledge (Anderson et al, 2020) the previous approach can be seen as a “top-down” method for portfolio management.
(Anderson et al, 2020) also propose the idea of strategic buckets as a categorization method to assign resources after the types of projects (or buckets) that contribute to the organizational strategies as defined.
Strategic agility can be defined as the capability of an organization to adapt quickly in response to changes in the market or new opportunities that can appear. In (Zahoor et al 2023) it is verified that gender diversity moderates the effect of strategic agility on value creation via responsible collaborative innovation in small and medium-sized enterprises from emerging markets. The previous study was carried out by taking a sample of small and medium enterprises operating in the United Arab Emirates.
Agile methodologies are very popular in the context of project management and (Kaufmann, 2020) show that the emerging strategy recognition can be better perceived when agile capabilities are present in the organizations because they can be a suitable way to adapt the portfolio to uncertain environments. However, the study did not find a positive relationship between agile capabilities and project success.
Finally, we can infer that when an organization does not promote permanently the elements that constitute its corporate identity (mission, vision, and values), it is highly probable that its members don’t know in which direction it is moving or the level at which it is achieving the strategic objectives.
References
Anderson, A. and T. Jurgens-Kowal (2020). Product Development and Management Body of Knowledge. Second Edition.
Zahoor, N., & Lew, Y. K. (2023). Enhancing international marketing capability and export performance of emerging market SMEs in crises: strategic flexibility and digital technologies. In International Marketing Review (Vol. 40, Issue 5, pp. 1158–1187). Emerald. https://doi.org/10.1108/imr-12-2021-0350
Kaufmann, C., Kock, A., & Gemünden, H. G. (2020). Emerging strategy recognition in agile portfolios. In International Journal of Project Management (Vol. 38, Issue 7, pp. 429–440). Elsevier BV. https://doi.org/10.1016/j.ijproman.2020.01.002
About the Author
Salvador earned a B.S. and M. Sc. in electrical engineering and a PhD in automatic control. Since 2009 he is a full-time professor at Tecnologico de Monterrey Campus Morelia (Mexico) at the School of Engineering and Sciences, teaching subjects such as Mechatronic Design and Industrial Robotics. Salvador is a New Product Development Professional by PDMA and passionate about the use and impact of tools and methodologies for (New) Product (Process or Service) Design and Development. His publications in international journals are in the area of educational robotics. He also loves teaching robotics and coding to kids.
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