How do you manage your portfolio of IT investments? Do you have a mental model for portfolio management? Here is an example:
While there are a lot of ways to manage a portfolio, I find the frame above to be highly effective. It’s from the Cranfield School of Management in the UK. It’s a very simple frame:
- Two dimensions: Value Today vs. Value Tomorrow
- Four Quadrants: High-Potential, Strategic, Key Operational, and Support
The key is to know where your investments are in terms of this map. A common path for investments is to move through the quadrants in this order: High-Potential, Strategic, Key Operational, and Support.
Example Investment Ratios
Here is an example of a common investment spread:
Above the Line
A cutting question to ask about your portfolio management is, “Are you operating above the line?” This cuts to the chase to answer two key questions:
- Are you operating on the top half of the chart?
- Are you working on things that create business value for your future?
You can use this frame to look at cloud investments … your current business investments … how you spend your time … etc. It can be a lens for a life, and a lens for learning … and a way to shape your path forward by flowing more value and staying in the game for the road ahead.
Here is a nice distillation of IT Portfolio Management and how to think about it as it relates to the cloud.