Optimization of Portfolio Management How to prioritize work within different departments and portfolios

Abstract

In recent years, many prominent manufacturing companies have adopted Agile development methods to respond swiftly to market dynamics and customer demands. This adoption has led to the integration of Agile practices into traditional Stage- Gate processes, resulting in what is termed as a hybrid approach. However, implementing such hybrid models poses challenges, especially in the realm of Portfolio Management. This thesis delves into the Portfolio Management practices within a manufacturing company operating in the automotive industry, specifically focusing on the function Vehicle Technology. The product development within Vehicle Technology develops embedded vehicle system solutions and services based upon both in-house and sourced software and hardware components, such as electronic control units and sensors. Through a case study approach, the research aims to explore the challenges and opportunities associated with Portfolio Management in a hybrid Agile-Stage-Gate environment. The study investigates how the Case Company prioritizes epics within its portfolios, identifies primary challenges in utilizing prioritization lists, and proposes recommendations to enhance the effective utilization of such lists. Drawing on insights from interviews with key stakeholders, the research identifies three primary challenges: inadequate implementation of Agile methodologies, lack of standardized estimation processes, and inefficient utilization of prioritization lists. Implementing Agile methodologies presents challenges, including ambiguity in adoption and resource-demand imbalances. Additionally, the absence of standardized estimation processes complicates effort and resource planning. Furthermore, inefficiencies arise from the inadequate utilization of the prioritization lists, leading to conflicts and missed opportunities. Addressing these challenges requires clarity, consistency, and optimization in Agile implementation, estimation practices, and prioritization frameworks. In addressing these challenges, the study offers insights into potential solutions and recommendations for optimizing Portfolio Management strategies. These include enhancing clarity and consistency in Agile implementation, developing standardized estimation processes, and refining prioritization frameworks to better align with organizational goals and capabilities. By shedding light on the complexities of Portfolio Management in a hybrid Agile-Stage-Gate environment, this research contributes to a deeper understanding of how organizations can navigate the challenges of epic prioritization, resource allocation, and decision-making in business environments.