Portfolio Question #11

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What is the impact of loading proposed projects into the pipeline?

Overloaded innovation pipelines are commonplace, if not epidemic. That inevitably leaves business leaders wondering when we can start development on the next new thing. Launching a new project into development is a big decision that should be considered very carefully. In addition to the rapid increase in costs that accompany moving into the development phase of work, the realistic probability of cancelling that project approaches zero.

The first hurdle in answering the impact question is having sufficient information on resource availability to know if and when we will have the capacity to take on new work. This requires some form of rough-cut capacity planning and the ability to forecast availability by skill set. If this analysis says that we cannot start anything new for several months, and we cannot add resources, then our only recourse is to look at cancelling something else in order to free up the necessary capacity.

Beyond capacity, adding new initiatives to the development pipeline gives us the opportunity to address mix and balance issues that may have been identified during the last review. If we are not proactive in shaping the portfolio to achieve our optimal mix, then we will always be reacting during comprehensive reviews. Pipeline loading is an opportunity to “pull” projects into the portfolio to address issues of alignment, mix and balance.

The final impact question is one of value. Does this new initiative increase the aggregate expected commercial value of the innovation pipeline? If the answer is “no,” then maybe we should be looking for another proposal. Achieving organic growth from innovation requires us to continually increase pipeline value.