Back to basics – Reshaping your growth portfolio: focus on the right topic and manage the complexity


“The biggest risk is not taking any risk” Mark Zuckerberg

The need for growth is critical and the right opportunities need to be identified. The success is highly dependent on a good management of the growth initiatives’ portfolio.

A.     Creation of a growth portfolio – focus on the strategy

“All change is not growth, as all movement is not forward” Ellen Glasgow (Novelist)

Growth strategy cannot be seen as an isolated initiative, it has to be thought globally for the firm, across all businesses and with comprehensive timeframe. In practice, a strategy needs to be set by the firm jointly with ExCo Members, including specific and measurable objectives. Then for the constitution of the portfolio, initiatives having an impact/benefit to reach the objective have to be defined by all business units with a diverse horizon: from next month to 2021 in our example below.

To minimize the risk of not delivering, and the impact of both internal and external dependencies a company can face during the delivery, you must include in your portfolio initiatives creating growth linked to Research & Development (long term), M&A (medium to long term), product innovation (short to long term),… as well as different business units (for example: Total would trigger growth on electricity and gas with M&A operation on Direct Energy, solar energy via research / product innovation and geographical expansion,…).

Diversify your portfolio of investment is a common advice to investors, keep that one in mind for your growth strategy and portfolio, this is exactly the same rationale behind.

B.     Analysis of the opportunities and prioritisation

“The role of leadership is to transform the complex situation into small pieces and prioritize them” Carlos Ghosn

At the ExCo level, all opportunities and initiatives must be listed and monitored. Based on the overall strategy of the firm defined preliminary, key indicators must be defined to analyse the opportunities and prioritise. For example: number of new client targeted, ROI, market size ($), timeline (deliver the project, return on investment day), cost, complexity/maturity, talent required, business unit, current position of the company (leader, mid, new, vs competitors)…

Having all these tangible and numerical information, our research shows that best in class players analyse and prioritise the opportunities using these criteria in this order:

  • Business unit: top performing players ensure that there are initiatives in all business units identified for growth in the global strategy. Also it is likely that due to talent/resources and overlap between opportunities, it is not possible to work in parallel on all initiatives within a business unit.
  • Timeline: by doing so, they ensure that there are prioritised initiatives delivering at every key milestones of the strategy. The goal is to avoid tunnel effect on the portfolio so the company can reconsider its strategy when necessary.
  • Market size: remember the initial objective => growth!
  • Cost / Value: we are still looking for the magical finance and free money, but while we do, you will have a certain amount of $ for investment in your growth strategy. So practically, if you want to reduce the pressure on the portfolio, you must prioritize all initiatives by Cost / Value.
  • Then look at all other key criteria for your company unless you have a specific focus (size of your client population, the complexity of the initiatives for example).

Our past experiences show that successful prioritisation exercises can be done on a portfolio of ~20 initiatives. Based on your scope, if needed, we recommend you to do the exercise within subsets of 20 based on the business line / bandwidth (IT, People) or… and regroup at the end. As a result of the prioritisation per criteria, give a number to each initiative following the Fibonacci numbers: 1, 2, 3, 5, 8, 13 and 21 (21 is your cap for all the lowest initiatives) (Serie: ‘N+2’=’N+1’+’N’).

And finally you can sum the priority number from each criteria for all initiatives and this gives the overall prioritisation (lowest number being priority number 1). The below example highlights the benefit of this method to assess potential initiatives and prioritise them clearly.

Our experience shows that Top 2/3 initiatives usually stand out from the group. Based on this, it is then critical to summarize the prioritized project and ensure the overall coherence with ExCo members.

Finally, based on rich and diverse experience (with European Leader in Asset Management, Global Bank,…), we have observed many of our clients with too many initiatives at a time, complex sale message, facing bottlenecks in term of resources / management support as well as IT bandwidth to release. Also, they haven’t defined clear priorities and put at risk the delivery of the most valuables opportunities. In a shaky environment, the more the approach is structured and scientific the more likely you will succeed.

C.     THE Governance to monitor but first and foremost to deliver

“Growth is never by mere chance; it is the result of forces working together” James Cash Penney (American Business Man)

Governance is always mentioned for projects and day to day activities in firms. But what we want to focus on and emphasize here is the key aspects of the governance to ensure the overall consistency and progress towards the objective of the firm instead of the governance per initiative which can be diverse in style and fairly standard practice.

Exco members who have defined the strategy triggering all the initiatives for growth must be part of an active and fairly agile governance through the entire life of the portfolio. Each project has its Steering Committee and proper governance, and an umbrella is required with stakeholders from all divisions and business units as well as HR. We recommend the agility to be mainly on talent management and strategy, but less in the tracking and the overall structure of the portfolio.

At the launch of the growth initiative, specific objectives based on observations, assumptions and rationales have been set. But during the life of the projects, based on lessons learned (from the first deliveries, the market evolution, new constraints…), ExCo members must not only monitor the progress, but also realign the strategy, the budget, the resources, reprioritize initiatives, redefine objectives for some specific projects…

While the strategy is being defined, KPIs have to be identified because they need to stick to what is critical for the decision making and then the prioritization. Hence at the start of the projects, KPIs should be defined clearly and communicated. But as explained above in regards to the governance, being Agile is also recommended for the KPIs because many projects are monitored and evaluated via the wrong indicators defined at the initiation of the project. We recommend you to include KPIs on delays, staff turnover, economic environment… because they are usually good indicator on the delivery of the project as well as the adaptation to the moving market.

In regards to the monitoring, two layers would exist: one within the project itself and one via the umbrella mentioned above. Transparent monitoring must be encouraged by the top management and failure is an option, otherwise there is a risk that KPI maintained by the project could become misleading or hiding an issue.

A strong management support is required to avoid conflicts between business units, and to optimize the usage of the resources (people and budget).

HR are also key stakeholders so the strategy, the implementation of changes and realignment are managed jointly with the staff, with people aspiration and development. A major risk in the current environment when you are challenging your business model, is people fear in the future, people not supportive to the initiative and looking for a safer environment. Really often, HR are the last ones aware of structural changes in the business and they endure instead of support the development and future of the firm.

In parallel to the point main above in term of bottlenecks, ExCo members must take their responsibilities when required to “kill” projects when they don’t deliver, the environment has changed or it is not a priority anymore, … A good gardener cuts the unwanted branches so the plants can grow more and in the expected direction.

D.    Talent is the future growth

“Knowledge is the power” Kofi Annan

Earlier in this article, we have highlighted the mindset needed to conduct a neutral analysis, be opened to ideas and prioritize growth initiatives. Therefore, do not underestimate the social and people aspects of growth hacking. You will likely have to manage 2 dynamics:

  1. One population keen to change, motivated but also demanding.
  2. One population skeptical, averse or neutral to the change, requiring support and attention but also key for the success of the firm in the long term
  3. The first population will be opened to new management styles, way of working and project management techniques. The purpose here is not enumerate all of them with pros and cons,. But, if you want your firm and employees to adopt these techniques, the management and top management need to actively adopt the same and play the role models at least through the governance mentioned above and the agility they would demonstrate in their growth portfolio management (Agile unity for the growth portfolio, and over time trying to build an Agile hive within the firm).

Our past experiences clearly shows that if you only rely on bottom up Agile approach, you will not succeed because this will create friction as soon as project teams will face challenges, delays or crisis,… Also, a significant proportion of the staff will doubt that these new methodologies are encouraged and understood, and naturally they would fall back into their past habits.

  1. Regarding the most skeptical population, regular and transparent communication about the rationale, the the objectives and the results of growth initiatives must be done. Indeed, they might not be as proactive as the first population mentioned here but they are still expert in their areas and they can propose good ideas. In addition, in order to have collaboration and build trust on this change, you must regularly explain and reassure them about the impacts as well as opportunities at their levels. Rumors are inherent to change, in parallel to the governance and umbrella steering committee, take the time to communicate progress, realignment, objectives, results, challenges to the entire staff to gain and keep the adhesion.

For all employees, opportunities as well as corners will be created. This needs to be foreseen and analyzed by each project but consolidated at the portfolio level and discussed with HR proactively. HR will play a key role in conjunction with the management to motivate and find opportunities to category 1 and guide/support category 2 during this journey.

An analogy can be made with sport. A team is made of players who have to be committed to giving 100%, so the quality and intensity of training will be at an optimum level. The coach will then select the team and substitute for the next games, but substitutes play a subtle, unseen and yet equally important in the context of training. A good coach must engage with his full squad and promote the future opportunities to keep substitutes on board. By contrast, the coaches very rarely engaged in any dialogue with the substitutes, rather, focusing exclusively on the starting players). If managed poorly, substitutes can develop a sense of ‘what’s the point’ mindset… sounds familiar to your environment?

“Teams win games, squads win titles.” Sir Alex Ferguson