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Say "no"

I recently read an interesting collection of Steve Jobs quotes assembled by Bruce Temkin. One in particular caught my attention;

• "And it comes from saying no to 1,000 things to make sure we don’t get on the wrong track or try to do too much. We’re always thinking about new markets we could enter, but it’s only by saying no that you can concentrate on the things that are really important."

This notion is perhaps the hardest concept to implement for many organizations. Focusing on what is really important is hard because it requires groups of people to prioritize opportunities, and further to define the criteria for deciding about what is important. More how we structure decisions like this.

Why don't more executive teams focus on "things that are really important?" In our experience, this kind of focus tends to constrain their future options. They prefer to have all their "balls in the air" at once to improve the chances that some will succeed. Or at least this is what they tell us. This way, one can't be accused of making the wrong choices. The logic continues, "Why limit my options?" Yet all those "options" suck up valuable resources and distract focus.

But Jobs was right; saying no, killing projects, focusing finite resources on a few things, and achieving expectations against "unreasonable" goals is in fact a portfolio strategy that worked/works. He proved it.

Related

Get rid of the crappy stuff

Steve Jobs best quotes (WSJ)

The Dinner Party

Recently we created this fictional "story" to describe a composite of obersations and experiences we've had over the years concerning strategy and the resulting product portfolio. Have you ever been to a Dinner Party like this?

There once was a couple that decided to invite some friends over for a dinner party. The husband invited 4 couples and 2 singles. He said that they could all have any meal they wanted and his chef would prepare it. The chef began making preparations for a dinner for 12 guests.

The chef was not sure what they all wanted, so he bought more than he needed just in case. He bought chicken, fish, many different meats, and different kinds of vegetables. He bought spices for all sorts of different cuisines, not knowing which ones the guests would choose. He made some assumptions and hoped he would be right. Of course this uncertainty came with a cost, but he was assured by the hosts that, “Money was no object” since the event was so important Further they said, “The dinner would have to be world class and at the cutting edge of culinary art.” He was up for the challenge, what could go wrong, he was a professional?

Shortly before the evening of the party the husband’s wife, after having reviewed the household budget, decided that money tight that month and she would need to reduce the chef's food budget by 30%. She told the chef to buy less food and to "get creative."

Accelerate Failure

Economist and Financial Times Columnist Tim Harford writes that, “Business success always begins with failure.”

(See a scanned version of Mr. Harford's article as I could not find it online yet, but it will most likely be published at http://www.babusinesslife.com eventually, or you can just buy his book). 

Mr Harford’s thesis is that failure is a critical element of learning, and learning is the basis of improvement… continuous improvement generates business success. It’s a fundamental engineering principal that innovation can only be achieved through successive failures. Discovering the root cause of failure enable solutions to be found. Innovation therefore can be accelerated through the acceleration of the “failure/analysis” learning cycle. “Fail-Fast” as some have said. The faster you fail, the faster you learn.

Converting strategy to portfolio mix/priorities

It's the job description and the competency "set" for an organization's Portfolio Executive. That middle-ground between Strategy and the creation of the product portfolio is still, in my mind, a mystery. What does that "translation" - or "conversion" - process look like? Or, is it just "artfulness"/who's got the power and influence/etc.?

Focus, focus, focus... you can't do it all (Part C)

In the previous two screencasts (see links below) about the “Project Portfolio” I described the process of project portfolio prioritization using constraints. In this screencast called “Part C” I’ll introduce the time dimension to the modeling process. We still need to select the best project mix to maximize benefit in order to meet our objectives, but in this next step we’ll consider how resources are used over time. This differs from my first two screencasts in this series where we looked at resources without consideration for when projects start and how they interact over time.

Focus, focus, focus... you can't do it all (Part B)

In the previous screencast “Project Portfolio -- (Focus, focus, focus... you can't do it all -- Part A)” I described the process of project portfolio prioritization using constraints. Specifically, Cost and Risk factors to re-prioritize the portfolio. In this screencast called “Part B” I will show you the third constraint type using Resources. We’ll deal with the same problem statement, “How to prioritize projects based on a limitation of resources.” We need to select the best project mix to maximize benefit in order to meet our objectives.

Focus, focus, focus... you can't do it all (Part A)

Project Portfolio is a discussion of how to prioritize projects, when resources are finite and you need to select the best portfolio of projects to maximize benefit, or in other words, “Those projects that give you the biggest bang for the buck.” How do you prioritize projects when resources are finite?

Differentiating best practices in prioritizing project portfolios

I've recently published a series of articles (listed below) on topics that differentiate "normal" product portfolio prioritization methods from some of the best-practice techniques we have observed and used in our practice with clients. They are subtle, but important differences that separate the best from the norm--further discussed in the following articles:

• Horizontal project scoring versus vertical prioritization (the zero-sum game)
• Pairwise ranking of objectives versus simple weighting
• Use real values for ranking alternatives
• Viewing project portfolios against constraints...to determine what can be accomplished with available resources
  

Given the constraints today, organizations must find ways of prioritizing their work so the limited and finite resources are directed at the right things to get the maximum benefit. The inefficient and unproductive parts need to be quickly shed and those that remain need to be made more effective through a process of focusing the "limited" resources on the right things (i.e. that generate max-benefit).

In some instances this is not a luxury, but rather a matter of life and death for some organizations.

Viewing project portfolios against constraints....to determine what can be accomplished with available resources

Traditional "project scoring" systems we see are a list of projects in a spreadsheet scored against some sort of measurement criteria. 

Most project ranking schemes stop at the ranked list of projects, at best. The problem is that you never know if the prioritized list can be completed without knowing what resources it takes to get all the project done, satisfactorily. 

These "constraints" must be applied to the project portfolio to determine "what can actually be done." A ranked list of projects is just the first step. This tells you what could be done, but not what can be done given available (and now "diminishing" in some organizations) resources. In addition to cost, material/equipment, and people constraints there are RISKS that need to be considered when selecting the optimal portfolio mix. Further, there are also the MUST HAVES that tend to override the basic logic of constraints. Without factoring in the constraints--just prioritizing projects in a portfolio is only 50% of the solution.

In the example above you can see a simple illustration of a budget constraint being applied to my little project portfolio. I need $10,150,000, but I only have $9.5M. The model applied the constraints and dropped the lowest ranking project. Simple to illustrate the point, but this gets more interesting when more projects are added into the mix and other factors such as RISK and MUST HAVES are factored into the model.

Use real values for ranking alternatives

Traditional "project scoring" systems we see look like this... a list of projects in a spreadsheet scored against some sort of measurement criteria. Sometimes the criteria is weighted by importance.

Further, the scoring of alternatives (or development projects) tends to be against simple numeric scales, such as 1-5 (i.e. 1 being low and 5 is high). Although this does provide a scoring system of sort, it falls short in really explaining the measurement criteria each project should be ranked against. It also requires a "look-up table" to cross reference what "5-high" really means.

Rather, we add the specific values to the model, such as the actual $ estimates for each objective/criteria. This improves the accuracy of the ranking model and its value as a communication tool.