Analyst role in portfolio decision making
Different roles required for good decisions
In two separate sessions last week, the typical roles required for a well-performing innovation portfolio management process came around. The questions raised prompted me to elaborate on the three critical roles I see from a process perspective. Let’s have a look:
- decision makers
Obviously, this is a key role in the decision-making process. In portfolio management, they are the gate keepers, the portfolio management board, the executives that decide about the portfolio strategy and content.
- data owners
These individuals or teams own the project data, the market intelligence, and the other relevant input for the decision. This includes project plans, market studies, financial information, as well as the project’s story or elevator pitch.
- decision analysts
Though a bit less obvious, this role is needed to link the two roles above. The analysts make sure that the data offers sufficiently actionable information for the decision-makers. In my experience, this pivotal role is key to a good decision-making process. In the American SDP and the European EDPN go as far as to consider this role a separate competence (the “DP” abbreviation in both their names is short for: Decision Professional).
If you check the 5 key ingredients of the portfolio management process in my earlier post, it is easy to map these roles on the process steps: the data owners generate proposals and execute the selected ones, the analysts work up this case data into a relevant portfolio analysis, upon which the decision-makers decide and drive execution.
What does the decision analyst do?
The following tasks I consider part of the analyst’s role:
- assess quality of the underlying data through a wide range of process and data checks;
- analyze the data at the project level to make sure the project data owners are really the “owners” of their case;
- analyze the data at the portfolio level to make sure the decision options or alternatives are well explored;
- support the decision-makers in their decision process by linking their questions to the data, such as focusing on the meaningful what-if analysis and by presenting consequences of different alternatives;
- making sure the loop is closed after the decision-making back to the project teams;
- implementing any learnings from each portfolio decision into the process.
In order to be capable to perform these tasks, the analyst role requires a solid understanding of the underlying business and technology in the portfolio (especially at the strategic level), excellent analytical and communication skills, and proper balance between process drive and content drive. Without focus on the content the portfolio management process is not effective, without focus on the process it is at least not efficient, and probably equally ineffective because of the lack of trust in the results.
Thinking about this decision analyst role, it is organized in various ways in different organizations I have seen. The analysts can be part of a project or portfolio office, they can be in a strategic product management job, or in a business and technology planning role, or even in business excellence or finance. It is their profile that makes the difference. To paraphrase their role in one line:
“the analyst links the decision-maker’s questions to the answers in the available information”
I am really interested in your view on this analyst role. Let me know how it works in your organization?