How can you integrate risk management into your portfolio planning?

1 Align risk management with portfolio strategy

The first step to integrate risk management into your portfolio planning is to align it with your portfolio strategy, vision, and goals. This means that you need to understand the risk appetite, tolerance, and thresholds of your organization and stakeholders, and how they relate to your portfolio value, benefits, and performance. You also need to establish a clear governance structure, roles, and responsibilities for risk management at the portfolio level, and ensure that they are aligned with the project and program levels. By aligning risk management with portfolio strategy, you can ensure that your risk decisions and actions support your portfolio objectives and priorities.

4 Leverage portfolio risk tools and techniques

The fourth step to integrate risk management into your portfolio planning is to leverage portfolio risk tools and techniques that can help you collect, analyze, and present risk information and insights. These tools and techniques include portfolio risk dashboards and reports that provide an overview of the risk status and performance of your portfolio, as well as portfolio risk heat maps and matrices that display the distribution and concentration of the risks. You can also use portfolio risk simulations and scenarios to model the potential outcomes and impacts of the risks on your portfolio value, benefits, and performance. Additionally, portfolio risk reviews and audits can evaluate the effectiveness of your portfolio risk management processes, practices, and results. By leveraging these tools and techniques, you can ensure that you have a data-driven and evidence-based approach to managing risks across your portfolio of projects.

5 Foster a portfolio risk culture

The fifth step to integrate risk management into your portfolio planning is to foster a portfolio risk culture that promotes a positive and proactive attitude towards risks and their management. To do this, you need to establish and communicate a clear portfolio risk vision, mission, and values that define the purpose, direction, and principles of your portfolio risk management. Additionally, you should engage and empower your portfolio team and stakeholders to participate in the portfolio risk management activities, while providing them with the necessary training, coaching, mentoring, and resources to enhance their skills. Moreover, you should recognize and reward the portfolio team and stakeholders for their contributions, achievements, and improvements. Ultimately, by fostering a portfolio risk culture, you will ensure that you have a people-oriented and collaborative approach to managing risks across your portfolio of projects.

6 Continuously improve your portfolio risk management

The sixth step to integrate risk management into your portfolio planning is to continuously improve your portfolio risk management by learning from your experience, best practices, and lessons learned. This requires collecting and analyzing portfolio risk data and feedback to identify strengths, weaknesses, opportunities, and threats. Additionally, you should compare and benchmark your portfolio risk management performance with industry standards and expectations. Moreover, you should implement and monitor improvements and changes to ensure they are effective and sustainable. Finally, review and update your portfolio risk management framework, processes, tools, and techniques to make sure they are relevant and current. Through these efforts, you can ensure that your approach to managing risks across your portfolio of projects is both learning-oriented and innovative.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?