What will you do?
Innovation portfolios aren't colourful toys.
Let's say you have mapped all your initiatives onto an innovation portfolio, created a stunning slide deck and a matching spreadsheet that makes the local data scientist quietly weep.
You have shown it to other executives, as well as other people tasked with innovation in your organisation. Everybody loved it, sounds of congratulations filled the room, and smiles were handed out like cupcakes.
Allow me to remind you of the why behind adopting a portfolio approach to innovation management in the first place:
The purpose of portfolio approach is to provide a big-picture overview of all your investments, with sufficient information to make an informed decision if some of them should be bolstered, revisited, or stopped.
In other words, the sole purpose of portfolio views (or maps) is to help you make better investment decisions.
Of course there are secondary benefits like improved transparency and alignment, but they are all dwarfed by the main intent.
Innovation projects are fickle. Opportunity cost is real.
Investment decisions shouldn't be dominated by personal preferences for pet projects, but rather evidence gathered by each of them.
Portfolio view surfaces vital details that contribute to the conversation.
Since budget is necessary for investments, innovation portfolios are usually owned by specific executives and select experts. Together they form a special-purpose governing body with mandate to invest into innovative projects and ventures that are expected to contribute to the organisation’s revenue and margin growth.
Their key job?
Making investment decisions.
Their key tools?
Innovation thesis and portfolio.
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