Lean Portfolio: Leading the Way to Agility for Flexible Organizations | NTT DATA

Fri, 28 October 2022

Lean Portfolio: Leading the Way to Agility for Flexible Organizations

Given the current fast-paced economy, factors such as inflation, the aftermath of war, and the global impact on consumption, there is a growing need to have dynamic, flexible plans, and quickly adjustable budgets. Additionally, managers and employees need to be aligned with teams comprised of people who can collaborate more and better, focused on adding value.

Changing the way organizations plan and finance their portfolio of initiatives using a Lean approach is one of the options available to address uncertainties in the current market. This approach is known as Lean Portfolio Management, and it optimizes the value stream and the use of Agile capabilities and is seen as one of the keys to Agile at scale. The Lean portfolio is designed for organizations seeking a competitive advantage in adaptability to market changes, which, along with multidisciplinary teams working with an end-to-end vision, will be the key for companies of the future.

Budget allocation is one of the biggest hurdles in scaling agile across the organization. In Latin America, there have been virtually no changes in how the budget allocation is planned. According to an NTT DATA study on Agility, only 8% of companies in Latin America have adopted Lean to manage their initiatives. Therefore, the ability to reallocate budgets and capabilities based on the promise of value creation is essential, one of the practices companies must adopt from the beginning of their Agile journey.

This new model allows organizations to optimize financial management, prioritize spending decisions, and focus on talent management factors. This rethinking is driven by agile frameworks such as Lean Portfolio Management. Startups, known for their fast response time compared to traditional companies, be the most likely to use this approach.

Applying these principles, portfolio managers can prioritize investments, optimize the use of resources, and define how to evaluate the value delivery of an initiative. This means migrating from complex annual planning and budgeting cycles (traditional approach) to more fluid and flexible planning with a more continuous workflow.

Through this new portfolio management approach at NTT DATA, we plan to continue leading the evolution of our customers' transformations to develop adaptive capabilities at the strategic level and to deliver more value with the benefits of a Lean-Agile approach. There are many benefits to this new approach, which also allows teams to adapt as the market and customer requirements evolve to achieve their objectives successfully.

NTT DATA promotes the adoption of Lean Portfolio Management in companies. However, it is necessary to follow several steps to implement it successfully. Firstly, it is important to recognize that implementing agility requires a mindset change and perceive it as an opportunity for growth, be aware that this approach requires the skills, knowledge, and experience of the people involved, and the testing phase is a part of the process. Also, understanding that this product complements agility at scale, and, finally, implement this process to deliver simple, fast, and valuable solutions.


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