OPMG6879 Program and Portfolio Management

Trendy Pc – Higher, faster, extended portfolio management plan

Team Assignment - Group 5

Assignment Submitted to:

Harold Ainsworth
Submission Date: 12 May 2024

University of Sydney

Student Name Student ID Roles

Ashley Bi 540759547 Section1, Section 2.2, Section 6
Emily Doyle 540588361 Section 3
Huu Loc Nguyen 530841306 Section 7
Md Taufiqul Wahab 540277188 Section 5
Zachary Bennett 530828891 Section 2.2, Section 2.3, Section 4
 Trendy PC – HFE Portfolio Management Proposal

TABLE OF CONTENTS
1. EXECUTIVE SUMMARY 2

2. PROCESS AND CRITERIA FOR INITIATIVES SELECTION 3

2.1. Portfolio Management Objective Identification 3

2.2. Financial Analysis and Initiative Ranking 3

2.3. Multi Criteria Analysis Card and Weighted Assessment 5

3. PORTFOLIO ASSESSMENT MATRIX - BUBBLE CHART 8

3.1. Bubble Chart Implication 8

4. TIMELINE TO DELIVERY INITIATIVES 9

5. PORTFOLIO MANAGEMENT IMPLEMENTATION PLAN 10

5.1. Program Implementation 10

5.2. Project Implementation 10

5.2.1. Allow Distributors to Access Our Internal Systems (Project 1): 10
5.2.2. Expanded Support Capacity with Online and Additional Help Desk Support (Project 2): 10
5.2.3. QA Services Improvements (Project 3): 11
5.2.4. Improved Desktop "Engine" (Hardware and Software) (Project 4): 11
5.2.5. Outsourcing Components of Production (Project 5): 11
5.2.6. Improved Production Facility for PCs and Notebooks (Projects 6/7): 12

6. RECOMMENDATION 13

6.1. Recommendations for Portfolio Finalisation 13

6.2. Ongoing Portfolio Management 14

6.2.1. Capability Maturity Model 14
6.2.2. Resource Planning 16

7. CONCLUSION 17

8. REFERENCES 18

1
 Trendy PC – HFE Portfolio Management Proposal

1. Executive Summary
This executive summary provides a comprehensive overview of the recommendation of investment initiatives to the Trendy PC executive, and
the proposed organisation of the selected initiatives into a portfolio.
The proposed portfolio is designed to be the ‘Higher, Faster, Extended Portfolio’ and maps neatly to Trendy PC’s corporate strategy, powerfully
branded for internal and external communication of the value and benefits that the portfolio delivers.
The report outlines the methodology for selecting initiatives proposed for investment, conversion of the initiatives into the overall portfolio,
including establishing the implementation timeframe for two targeted programs overarching seven projects and the associated
interdependencies within the portfolio, along with the monitoring strategy and doctrine employed within the various programs and projects.
The method for down selection of the investment initiatives was threefold:
1. Portfolio Management Objective Identification is to determine the main business streams for improvement, ensuring the selected
initiatives meet the requirement of the business strategy.
2. Financial and Risk Analysis is performed to determine quantitively value to the business from the submitted initiatives combining with
the risk consideration.
3. Multi-criteria Analysis (MCA) is performed to determine qualitative value to the business from the shortlist of investment initiatives
identified from the financial and risk analysis.
Upon the selected the portfolio, Performance Assessment Matrix in the form of Bubble Chart is developed to virtually demonstrate the
investment initiatives quantitively and qualitatively. The level of risk associated with each investment initiative is indicated in the bubble chart.
The identified initiatives are then group following the hierarchy showing in figure 1, providing guidance for the implementation timeline within an
overall 19-month duration.

Figure 1 – Portfolio Management Hierarchy

Upon the initial selection of submitted initiatives, the following recommendations are provided to support the portfolio finalisation and ongoing
monitoring.
1. Conduct holistic stakeholder consultation to cover perspectives from all key stakeholders, formalise the root definition of the portfolio
management and form the final portfolio selection.
2. Adopt capability maturity model.
3. Introduce portfolio resource management plan to ensure ongoing resource allocation.
4. Portfolio flexibility is informed by viable alternate approaches in both methods, project interdependency and project implementation.
This report has the following assumptions embedded:
1. All initiatives to be implemented will not use the current FTE, labour hire will be used for the implementation (cost has already been
included in the total cost)
2. Initiative benefit realisation is evenly distributed throughout the duration of each initiative.
3. The organisation is running break-even, no additional income contribution is requested from any initiative.
4. Initiative selection and recommendation will be based on the consulting team’s opinion only. Stakeholder consultation will be conducted
upon presenting this report, prior to executive’s decision-making.

2
 Trendy PC – HFE Portfolio Management Proposal

2. Process and Criteria for Initiatives Selection

Knowing the portfolio management is to serve the investment decision-making within an organisation, a top-down system is employed to guide
the overarching principle, where the business strategy leads the selection of the submitted initiatives to ensure the value to be realised from the
portfolio management align with the business value.
The aim of this selection process is to develop the Higher, Faster, Extended (HFE) Portfolio that aggregate the best combination of initiatives
that optimise the business investment outcome within the fund availability.
The selection of the portfolio is conducted through three steps.
Step 1 - Define portfolio management objective
In this step, following the top-down system and portfolio balancing principle, main business streams where improvement opportunities are
identified and serves as the key selection criteria 1 to support the forming of the portfolio. This step allows stakeholders to understand the
purpose of the proposed portfolio, and to initially align the business strategy with operation teams’ activities for a smooth implementation.
Step 2 - Financial analysis with scoring system
Under step 2, financial analysis is conducted for submitted initiatives for its cost effectiveness and cost-benefit efficiency using the customised
scoring metric. Additionally, risks associated with each initiative is scored based on the risk rating and is incorporated into the scoring system.
Final score of each initiative is used as the key selection criteria 2. This step allows all stakeholder to understand the value of each initiative
quantitively, along with potential risks.
Step 3 - Multi Criteria Analysis (MCA) card
The final step is to develop an MCA card for initiatives ranking the top under the requested category using key selection criteria 1 and 2. The
MCA card is developed based on pair-wise comparison of key parameters for each initiatives using differentiating factors. The card is facilitated
with a spreadsheet-based programme that allows the comparison of initiatives from multiple perspective, e.g., value in product quality and
value in customer services. The MAC card aims at assisting the audience to understand the alignment between the portfolio and Trendy PC’s
corporate strategy. Upon the completion, a weighted assessment is performed based on the pre-assigned weighting percentage.

2.1. Portfolio Management Objective Identification

According to Hunter, R. and Westerman, G. (2009), there are three categories of investment when establishing business portfolio which aims at
different goals: business operation, business growth and business transformation.
In this case, the three investment categories align with Trendy PC’s business strategy: quality production and quality customer service to
support the business operation and growth, while innovation to support potential business transformation. Combining with the categories
provided in the submitted initiatives, the proposed portfolio addresses the emphasis on manufacturer, quality, support, research & development
(R&D), distribution and infrastructure.
The objective of this recommendation is to identify a list of key initiatives based on the business strategy and value drivers of each initiative
covering the business strategy. The selected initiatives form the basis for the projects within the programs and overall portfolio.
Although improvement opportunities are identified in ‘Admin’ area, it is not identified as a priority of the portfolio management for various
reasons. Firstly, the proposed initiative benefiting administration area within Trendy PC does not bring high financial return. Secondly, it is
challenging to verify the benefit from communication efficiency quantitively, the data collection and report generation may trigger additional
costs and Business As Usual (BAU) activities, which may further lower the workplace efficiency. Thirdly, with the development of ICT tools and
applications, communication can be improvement disregarding the physical barries, adopting digital communication tools may achieve the
same result.

2.2. Financial Analysis and Initiative Ranking

This step is to undertake financial analysis regarding the cost-effectiveness and cost-benefit efficiency analysis by calculating the ratios for
each initiative. By considering risk rating in addition to financial performance, a final scoring system is used to determine the raking of submitted
initiatives in each category, as well as balancing the investment return and potential risks.
Cost effectiveness ratio demonstrate the cost effectiveness of an initiative, where how much cost is requested to generate the benefit. A high
cost-effective ratio presents the high benefit margin of an initiative, therefore a higher score. Cost-benefit efficiency ratio shows how much
benefit can be realised per month during the implementation of an initiative. A higher ratio means a higher monthly return of an initiative,
therefore a higher score.
Initiatives with the highest score under each category present either an option with strong investment return and relatively high risk, or an option
with steady investment return and low risk. The aggregated financial and risk analysis outcome is shown in table 1, alongside with table 2 with
details in score range.

SCORING CRITERIA SCORING BY CATEGORY

COST-
COST- COST
COST- RISK BENEFIT TOTAL
NO. DESCRIPTION CATEGORY RISK BENEFIT EFFECTIVENESS
EFFECTIVENESS SCORE EFFICIENCY SCORE
EFFICIENCY SCORE
SCORE

Change office layout to

13 improve communications Admin L 3.00 0.50 3 2 1 6
among staff

Improved marketing support

15 Distributors M 4.33 1.44 2 3 1 6
for distributors

4 Allow distributors to access Distributors M 2.75 5.50 2 2 3 7

3
 Trendy PC – HFE Portfolio Management Proposal

SCORING CRITERIA SCORING BY CATEGORY

COST-
COST- COST
COST- RISK BENEFIT TOTAL
NO. DESCRIPTION CATEGORY RISK BENEFIT EFFECTIVENESS
EFFECTIVENESS SCORE EFFICIENCY SCORE
EFFICIENCY SCORE
SCORE

our internal systems

QA services improvements –
5 recommend by ISO auditors to Infrastructure L 4.00 1.50 3 3 1 7
retain certification

Additional IT facilities –
8 Infrastructure M 0.89 0.80 2 0 1 3
internal and distributor support

New accounting system – will

3 improve internal management Infrastructure M 3.00 1.88 1 2 1 4
controls

Outsourcing components of
7 Manufacture L 4.00 2.80 3 3 2 8
production

Improved production facility for

12 Notebooks - improve quality / Manufacture H 3.33 2.22 1 2 2 5
throughput

Extended storage for spare

10 parts with improved retrieval Manufacture M 1.50 0.90 2 1 1 4
access

Improved production facility for

2 PC’s – improve quality and Manufacturer H 4.00 6.00 1 3 3 7
throughput

Improved desktop “engine”

(hardware and software) –
11 R&D M 7.33 1.47 2 3 2 7
speed and reliability and
functionality issues

9 New monitor design and R&D

H 4.75 1.36 1 3 1 5
prototype

1 New Notebook design and R&D

H 3.40 1.70 1 2 1 4
prototype

14 Expanded support capacity Support

with on-line and additional L 2.40 2.00 3 2 2 7
help desk support

6 Improve internet access for Support

H 4.00 3.20 1 3 2 6
customers requiring support

Table 1 – Finance and Risk Analysis

Score Criteria Score Description

High 1 The initiative is less preferred due to a high-risk rating.

Risk Medium 2 The initiative is mutual due to a medium risk rating.

Low 3 The initiative is more preferred due to a low-risk rating.

Below $1M 0 The initiative is not preferred as it demonstrates no cost effectiveness.

$1M - $2.5M 1 The initiative is less preferred as it demonstrates low-cost effectiveness.

Cost
Effectiveness
$2.5M - $3M 2 The initiative is mutual as it demonstrates average cost effectiveness.

Above $3.5M 3 The initiative is more preferred as it demonstrates high-cost effectiveness.

$0M - $2M per Month 1 The initiative is less preferred as it demonstrates slow monthly investment return.
Cost-Benefit $2M - $4M per Month 2 The initiative is mutual as it demonstrates average monthly investment return.
Efficiency
Above $4M per
3 The initiative is more preferred as it demonstrates high monthly investment return.
Month
Table 2 – Scoring System

4
 Trendy PC – HFE Portfolio Management Proposal

2.3. Multi Criteria Analysis Card and Weighted Assessment

Based on the financial analysis results, it is identified that initiative 4, 5, 14, 2, 7 and 12 demonstrate strong financial performance under the category of Distribution, Infrastructure, Support and Manufacturer.
Therefore, these initiatives are identified as the components of Trendy PC’s portfolio.
Note that initiative No.12 has a relatively low score comparing to other initiative. However, it is aggregated with initiative 7 and 12 as the production optimisation project to achieve the optimum value in
manufacturing. The Multi-Criteria Analysis (MCA) approach has been used to undertake a qualitative assessment of the initiatives down-selected based on the Financial and Risk Analysis conducted.

Initiative Qualitative Selection Criteria

Reliability of
Initiative Quality of Quality of Alignment to Assumptions Risk/s
Information on Weighted
Products Aftersales Service Corporate Strategy
Program
Portfolio

Product Range MCA Score

Weight – 20% Weight – 20% Weight – 40%
Weight – 10%

 Platform configuration enables

third party access.
Supply Chain will have  Third party legal agreement.
Provision of hardware
Distributors providing direct access to product  Division of responsibility clearly
4 - Allow distributors to components following
components which meet Efficient ordering / real catalogues. articulated and agreed.
KANBAN methodology  Intellectual Property (IP)
access our internal demand signal and time product availability –
enabling increased
3.6  Supply Chain process selection
 Internal platform configuration
systems (Project 1) specifications of product elimination of ‘waste’. Real-time product complete (KANBAN).
throughput and product specification available to
offering.  That we will get buy in
availability and reliability. suppliers. (support) from distributors.
 That Trendy PCs IP is
protected.
Enable and Empower
Faster Higher Extended Portfolio

Customers will have direct  Online platform development

14 - Expanded support Human to Human user access to product complexity
Online subscription service  Extant staff available to support
experience and aftersales catalogues.  Skilled resources to configure
capacity with on-line available to Customers, helpdesk
Not Applicable. services, available 24/7. 2.5 online platform
and additional help fulfilling corporate strategy of Real-time product  Platform selection has been
Aspiration to be best-in-  Extant staff fluency in new platform
desk support (Project 2) extended utilities. specification available to completed
class.  Changed used experience may
Customers. confuse current customer base

Implementation of ISO  Resources needed to prepare

Implementation of ISO Limited utility from  Gap analysis has been
5 - QA services framework along with Reduction in defective documentation to support ISO
framework will ensure implementation ISO performed to determine ISO
KANBAN, Kaizen, and products will improve certification
improvements (Project Heijunka principals will reputation and entice new
alignment to the strategy of certification, however 4 certification implementation
 Timely approval of ISO certification’
3) selling to a market which improved quality of plan
lead to high quality customers.  Implementation of ISO policy and
demands quality. information expected.  All-in costs are understood
outcomes. processes within existing system/s

Improvements of Strong linkage to corporate

Performing in-house R&D  Competitor analysis has been
11 - Improved desktop components which Improved quality of strategy of providing new and  First of a Kind (FOAK) technology
enables the business to performed to determine
enable hardware and products will lead to less improved models with  Vertical integration of third-party IP
“engine” (hardware and software speed and aftersales service additional features (faster
communicate effectively 3.3 development opportunities
 Horizontal of lifecycle systems
software) (Project 4) features of new desktop  Technology provider has been
reliability improve overall requirements. processes, higher  Time to market
engine to the market. selected
product quality. resolutions).

7 - Outsourcing Only performing what the Providing cutting-edge Ability to offer faster Supply Chain will have 2.9  Trendy PC is not able to  Base assumption that accessing
Defect Free

Components of organisation can perform technology to our user processors and higher direct access to product produce best components external suppliers will lead to better
Production (Project 5)) more effectively and base. resolutions. catalogues.  Trendy PC has capacity and product offerings
efficiently than other capability to manage suppliers  Increased dependency on multiple
parties. Real-time product vendors / suppliers increases
specification available to supply chain complexity
suppliers.

5
 Trendy PC – HFE Portfolio Management Proposal

State of the art facility which

 Cost of facility and upgrades -
is organised and designed on  Current production facilities immature capital estimate based on
Kaizen principals - continuous located in separate locations
Aftersales service will limited designs for new facilities
small improvements leading  Investment initiatives 12 and 2
Production extend to facility tours for  Availability of capable resources
to overall excellence in to be combined into one
2 /12 - Improved Improving reputation for interested customers and  Fluency in adopted methodologies
production of increasing location
Production Facility for premium, cutting-edge clients to showcase (relying on international production
sophisticated products. Not Applicable. 3.9  Current facilities require
Notebooks (Projects products and ability to cutting-edge production know-how)
Initiative 2 and 12 will be extensive upgrades /  Outsourcing to suppliers that do not
6/7) scale offerings. and implementation of
implemented utilising refurbishments share vision and values – potential
FOAK and R&D. This will
Heijunka principals – project  Manufacturing processes reputational risks (e.g. modern
lead to global growth.
‘leveling’ through creating selection complete (KANBAN, slavery)
utility of components for both Kaizen, Heijunka)
Notebook and PCs.

Table 3 – MCA Card

6
 Trendy PC – HFE Portfolio Management Proposal

Table 4 below performs the weighted assessment based on aggregated outcome from the
previous financial and risk analysis and MCC Card, using the assigned percentage over 4
criteria.
The weighting reflects the important of the criteria, where alignment to corporate strategy is
assigned with the highest rating of 40%. This allocation agrees with the selection
methodology and emphasis on the corporate strategy. The remaining three criteria shares
equal percentage as they demonstrates the value of the selected initiatives to different
business streams.

2.Quality of 3.Alignment to 4.Reliability of

1.Quality of
Aftersales Corporate Information on Total
Products
Service Strategy Product Rate Weighted
Weight - 20%
Weight - 20% Weight - 40% Weight - 20% MCA
Weighted Weighted Weighted Weighted Score
Score Score Score Score
Score Score Score Score
Initiative 4 - Allow
distributors to access our 6 1.2 10 2 4 2 10 2 7.2
internal systems
Initiative 14 - Expanded
support capacity with on-
0 0 10 2 4 2 10 1 5
line and additional help
desk support
Initiative 5 - QA services
10 2 4 0.8 10 5 2 0.2 8
improvement

Initiative 11 - Improved
4 0.8 2 0.4 10 5 4 0.4 6.6
desktop “engine”

Initiative 7 - Outsourcing
10 2 2 0.4 6 3 4 0.4 5.8
components of production

Initiative 12 - Improved
Production Facility for 10 2 4 0.8 10 5 0 0 7.8
Notebooks

Initiative 2 - Improved
10 2 4 0.8 10 5 0 0 7.8
production facility for PC’s

Table 4 – Weighted Assessment

7
 Trendy PC – HFE Portfolio Management Proposal

3. Portfolio Assessment Matrix - Bubble Chart

With the landscape of the aforementioned strategic goals in mind, the ability to view risk
alongside cost-benefit analysis, and multi-criteria analysis plays a significant role in assisting
management in understanding why these initiatives are favourable for future success. A
bubble diagram provides a holistic assessment that helps unpack the prioritisation of the
chosen initiatives, as well as the relationship between them. Included below is a bubble
diagram created to present how the chosen initiatives can effectively propel Trendy PC
towards their corporate vision.

Figure 2 – Bubble Chart

Portfolio Assessment Matrix (Bubble Chart) above for the HFE Portfolio of initiatives. Note
the size of bubble represents the Risk rating of the initiative (High, Medium or Low) with a
larger bubble illustrating a higher risk rating.

3.1. Bubble Chart Implication

The above portfolio assessment matrix, which utilises a bubble diagram, informs
management that although some of the initiatives adopt a higher risk level, when
represented alongside their high-cost benefit analysis score and multi-criteria analysis
weighted score, the implementation of risk is acceptable and recommended. The
recommended initiatives do not exceed available capital limits and the return-on-investment
falls within the predicted range. In addition, the bundled portfolio delivers efficiencies and
coverage of corporate goals through strategic decision making that would not be applicable if
each initiative was delivered separately. The collective visualisation of the program allows
management to better understand the way risk has been evenly weighted over the projects,
ensuring there is a balance that supports the future success of the portfolio and in turn, the
business.

8
 Trendy PC – HFE Portfolio Management Proposal

4. Timeline to Delivery Initiatives

Figure 3 below outlines the integrated timeline for the initiatives. The duration of HFE
Portfolio execution is 20 months, with seven projects / initiatives grouped into two programs
of work, with four interdependencies.
The two programs – EEP and DFP - share interdependencies with the Enable and Empower
Program being largely executed ahead of the Defect Free Production Program. It is
envisaged that the Implementation Team will focus on the Enable and Empower Program in
parallel with the Defect Free Production program to ensure that the interdependencies
contribute to the portfolio achieving its strategic intent.

Figure 3 – Portfolio Management Timeline

9
 Trendy PC – HFE Portfolio Management Proposal

5. Portfolio Management Implementation Plan

After confirming the portfolio to proceed and the associated timeframe, this section provides
an overarching guidance on the implementation of the portfolio with the assessing the
characteristics of the sub-programs and sub-projects. Given the value alignment for each
initiative is introduced in the MCA card, this plan emphasis on implementation methodology,
underpin assumptions and identifying potential risks for the proposed initiatives.

5.1. Program Implementation

At the program level, Agile and Kanban methodologies are considered the best fit for the
portfolio of Trendy PC's due to the diverse nature of projects and the specific requirements
of each initiative.
Agile is well-suited for projects that require flexibility and adaptability. Initiatives such as new
notebooks and customer support enhancements can benefit from Agile approach by
adopting quick adjustments based on customer feedback. Central to this approach is the
product backlog, a prioritised list of requirements managed by the product owner, guiding
each iteration's focus and ensuring alignment with business strategy (Hazzan, 2008;
Schwaber, 2002).
Kanban is considered as it allows the visualisation of workflow and the standardisation of
workflow, as well as identifying blocker and dependency (Atlassian. n.d.). Utilising Kanban
provide the operation teams with visibility of the progress of other project, in particular
projects with interdependency. With an early awareness of task shifting, responsible
operation teams can conduct early engagement of work and change direction if requested.

5.2. Project Implementation

5.2.1. Allow Distributors to Access Our Internal Systems (Project 1):
Given flexibility for changing requirements, agile is recommended for the implementation of
this project. It is necessary for distributors to evolve during the project, and agile allows the
frequent loop and align with the continuous needs. Collaborating between team and with
stakeholders is also a reason. For better adoption and higher satisfaction throughout the
project.
No interdependency is identified for this initiative, it can be executed irrespective of other
initiatives.

5.2.2. Expanded Support Capacity with Online and Additional Help Desk
Support (Project 2):
This project involves continuous improvement and responsiveness changing customer
needs, therefore agile is again proposed.
Agile engages frequent feedback and quick adaption in changes, where customer feedback
can be adopted for direction adjustment. Also, a collaborative approach maximises the value
to the customers.

10
 Trendy PC – HFE Portfolio Management Proposal

This initiative is independent from others with two assumptions applying: firstly, additional
staff can be on-boarded if requested by support helpdesk; secondly, platform selection has
been completed.
Risks:
 Customers misuse the service.
 Fake feedback from competitors.
 Underestimate of online platform development.
 Changed used experience confuses existing customer.

5.2.3. QA Services Improvements (Project 3):

There is limited information provided for the initiative and the simplicity, no specific
methodology is requested for the implementation of this initiative.
Given the initiative improves the quality management of the current business and it affects
the production line, a check point of the completion of project 3 is embedded in the timeline
of project 7. Upon the completion of QA improvement, manufacturer is able to adjust its
standard based on the outcome of this project.

5.2.4. Improved Desktop "Engine" (Hardware and Software) (Project 4):

Agile is essential when a project faces the challenge with technology enhancements. Agile
methodology would be the most appropriate approach for this project, as it provides
flexibility, adaptability and continuous improvement. These are necessary to successfully
execute technology enhancement initiatives.
Risks:
 First of a Kind (FOAK) Technology: Risk of encountering unforeseen challenges.
 Vertical Integration of Third-Party IP: Third party Intellectual Property may face
contractual or legal complexity.
 Horizontal Lifecycle Systems: Possibility of requirement additional resources and
time.
 Time to Market: Delays in development production.
Assumptions:
 Competitor analysis has been performed to determine development opportunities.
 Technology provider has been selected.

5.2.5. Outsourcing Components of Production (Project 5):

As this initiative is related with manufacturer, either the Waterfall or Kanban can be used for
this initiative depending on the project details.
Waterfall follows the clear requirements and deliverables it also minimises changes during
implementation with detailed planning, clear documentation, well defined deliverables,
minimise the changes during the product life cycle ensuring polished implementation.
Manufacturing also can be implemented by Kanban methodology as Kanban follows the lean
manufacturing principles where workflows can be visualised on Kanban board, workflow is
managed and continuous improvement.
Key Risks

11
 Trendy PC – HFE Portfolio Management Proposal

 Diversification of supply chain complexity.

 Dilution of reputation through reliance on third parties' performance.
 Outsourcing to suppliers that do not share vision and value potential reputational
risks (e.g. modern slavery).
Dependencies:
 Initiative 12 (Project 5) and Initiative 2 (Project 6): Benefits associated with this
initiative will only be fully realised when the new production facilities are online and
through the implementation of KANBAN methodology (Cvetković, Morača, Jovanović,
et al, 2017. P.0664)
Assumptions:
 Trendy PC is not able to produce the best available components within the available
funding.
 Trendy PC has capacity and capability to perform supply chain management.

5.2.6. Improved Production Facility for PCs and Notebooks (Projects

6/7):
Projects 6 and 7 are combined during the implementation stage given the strong correlations
between their goals and requested resources. This initiative has been included in our Defect
Free Production Program of work due to the utility which both initiatives have across the
product range.
A significant investment and complex engineering are involved in this initiative. As Waterfall
method follows the structured approach with sequential phases: design, procurement,
manufacture that allows for planning, budget control and risk management, it is the best suit
for this initiative. Waterfall methodology comes up with clear milestones and dependencies
that allows better tracking of progress and interdependencies between different phases of
project.
This initiative serves to update and align the facilities to implement Kaizen methodologies
(small continuous improvements) and Heijunka principals which serves to balance inventory
and effort through the standardisation of components across the Notebook and PC range
(Kurihara, T., Kawanaka, T., & Yamashita, H. 2019 P.152).
Kaizen methodology has been identified as the preferred management methodology due to
the linkage between manufacturing and supply chain – the literature outlines that this
approach spans multiple techniques for improvement of productivity, quality and
effectiveness in the manufacturing industries (Singh and Singh, 2009, p. 52).
Risks
 Cost of facility and upgrades.
 Availability of capable resources.
Dependencies:
 Initiative 14, Initiative 5, and Initiative 7.

12
 Trendy PC – HFE Portfolio Management Proposal

6. Recommendation
This report presents the methodology for the development of Trendy PC’s HFE Portfolio,
where the selected initiatives demonstrate value contribution in one or multiple business
stream with effective costing. To assist Trendy PC to finalise the structure of the portfolio
and implement associated programs and projects, recommendations are provided under this
section.
Recommendations are formed by two parts: recommendations for portfolio finalisation and
recommendations for ongoing portfolio management. Within the first section, a sound
guidance is provided to Trendy PC’s internal stakeholder regarding the process of finalising
the selection of portfolio component. In the second section, recommendations regarding the
lifecycle management of the determined portfolio are provided to ensure high-standard
governance structure, resource planning and performance monitoring are available.

6.1. Recommendations for Portfolio Finalisation

The development of Trendy PC portfolio adopts quantitative and qualitative analysis aiming
to achieve the optimist outcome theoretically. However, internal stakeholders (e.g.,
operational team, finance team) and external stakeholders (e.g., distributors) are not
involved with during the selection process. Acknowledging that the development of the
portfolio is based on limited understanding of the business environment and relationship, it is
vital to engage key stakeholders may be impacted by the portfolio for inputs.
The recommendation prior to decision-making is conducting holistic stakeholder
consultation. Adopting the Soft System Method (SSM) (Checkland, 2000), stakeholders are
grouped by customers, actors, owners and environment. Transformation actions and
worldviews are also considered to conclude the root definition of Trendy PC portfolio
management activities.
Customers are classified as beneficiaries of the action, which are represented by business
stream owners in this scenario. Actors are stakeholders that performs the activities, which
are also the business stream owners. Transformations are projects to be undertaken once
the portfolio is finalised. Environments are commonly seen as the external enabler or
constraints within a situation. In this case, finance & admin team is identified as environment
as they provide support and resources requested to deliver the transformation. Worldview,
also known as the rationale of the activity, is to transfer internal resources into long-term
value supporting business development.
Combining Trendy PC’s organisation chart and the proposed portfolio, the portfolio
finalisation roadmap, including stakeholder consultation sessions is shown in figure 4.

13
 Trendy PC – HFE Portfolio Management Proposal

Figure 4 – Portfolio Finalisation Roadmap

6.2. Ongoing Portfolio Management

Once the portfolio selection is finalised, Trendy PC is transition into portfolio implementation
stage following the project management methodologies identified in section 5. Despite the
implementation of each initiative, the overarching strategies should be followed to ensure the
initiatives are properly supervised with holistic monitoring process, performance
management and resource planning. Recommendations are provided based on the three
aspects.

6.2.1. Capability Maturity Model

Humphrey (1987) introduced the maturity framework initially for improving the software
processes, which assisted the user to assess the capability of the software contractors. This
concept can be applied to examine the maturity of organisation’s portfolio management.

Figure 5 – Capability Maturity Model (Humphrey, 1987)

14
 Trendy PC – HFE Portfolio Management Proposal

As suggested in the process evolution diagram, there are five stages of portfolio
management maturity, starting from initial to optimising.
Trendy PC has established the basic portfolio management process where initiative
selection occurs annually with allocation capital funding; however, the selection is not guided
with any principle. It indicates that the maturity of Trendy PC’s portfolio management sits at
the initial stage. At this stage, the business does not have a sound selection criteria system
for portfolio screening and monitoring strategy during implementation. The lack of guidance
and supervision may lead to misuse of resources (e.g., low investment return with poor
outcome, or misalignment between investment and business strategy) and ineffective
tracking of portfolio health. It is recommended that Trendy PC can introduce on-going
reporting system and data collection process to uplift the portfolio management maturity to
managed level.
It is acknowledged that level 5 maturity can bring additional value comparing to the
recommended practice. However, implementing level 5 maturity request a substantial
amount of human resources and financial resources for data collecting, framework design,
process monitoring activities. Given Trendy PC is classified as small to medium enterprise
and the complexity of its portfolio is low, the benefit from the extra governance and
administration activities may not be realised due to the higher overhead cost.
The recommendation of achieving level 4 maturity has two parts - establish portfolio
selection matrix and establish portfolio reporting system.
The portfolio selection matrix will be designed based on the current business strategy,
following the structure of Table 3. The matrix shall initiate with the business strategy to
ensure initiatives are consistent with the business goal. The matrix will then be categorised
by business streams to indicate the value adding to different business areas. Finally,
weighting will be applied to each category according to the business strategy. Note that the
weighting requires regular assessments, as the weighting system reflects the focus of
Trendy PC during a period and this direction may shift due to impacts from internal and
external factors.
Portfolio reporting system will be established to implement on-going monitoring and
assessments for the overall progress, portfolio health check and benefit realisation. Three
main reports should be included monthly in the system: Risk and issue report, program
status report and performance report.
Program Status Report:
The Program Status Report is a holistic report that aggregates the status of active programs
and projects within the portfolio. The report should cover the progress of individual projects,
key milestones achieved and upcoming, resources’ capacity and capability.
The objective of the program status report is to demonstrate the status of all
sub-program/projects to the stakeholders. It also serves as a communication channel
between each business areas, since the progress of the project can be clearly obtained from
this report. Stream owners can have early engagements with other business sectors if there
is any potential issue is sensed.
Risk and Issue Report:

15
 Trendy PC – HFE Portfolio Management Proposal

The Risk and Issue Report will be developed monthly using the risk and issue register in the
business. The report incorporates open risks and issues within the portfolio/program/project,
alongside with risk assessment and proposed mitigation strategy.
The objective of this report is to provide assurance to the overall portfolio management by
proactively perform internal control and evaluation. Given there are interdependencies
between projects or programs under the business portfolio, it is vital for stakeholders to be
aware of the open risks and their impacts, and mitigation strategies can be effectively
applied.
Performance Report:
The Performance Report provides timely tracking of the performance for each initiative within
the portfolio with designed performance measure matrix. As part of the preparation of the
portfolio management, performance measure matrix needs to be designed based on the
desired outcome of the initiative.
The objective of this report is to ensure initiatives achieve their value as predicted during the
selection stage. As the program/project progressing, this report also allows the business to
supervise the value realised. The report assures the investment demonstrate value for
money.

6.2.2. Resource Planning

There are two components of the resources associated with Trendy PC’s portfolio – Human
resource and financial resource. Recommendations around resources planning allows the
business to effectively manage its available resources with capability of managing resource
gaps caused by scope creep or risks.
Human resource planning:
This report assumes that no internal human resource is requested for the proposed
initiatives. The benefit is that BAU activities will not be affected with increased scope;
however, labour outsourcing triggers higher costs for the investment opportunities.
General human resource recommendation is that project management training can be
provided to staff at all levels to ensure the project management process in Trendy PC follows
a consistent standard. Training opportunities should be provided depending on the
requirement of initiatives for staff at operational level.
Financial resources planning:
The current portfolio proposed is developed based on the estimated cost, noting that limited
information is available to perform costed risk analysis and contingency estimation,
contingency fund is not allocated in this report. However, it is recommended that Trendy PC
allocates portfolio contingency fund annually prior to the selection of initiative to allow flexible
funding arrangement.
The estimation of contingency fund should refer to industrial benchmark and costed risk
analysis.

16
 Trendy PC – HFE Portfolio Management Proposal

7. Conclusion
The process and criteria for selecting initiatives were conducted through a three-fold
approach, including portfolio management objective identification, Financial and Risk
Analysis and Multi-criteria Analysis.

With the objectives established on business operation, growth, and transformation, the HFE
portfolio can set the benchmark combination of initiatives that will guide the optimization of
Trendy PC business investment outcomes within the company budget while simultaneously
aligning with the business value and strategy.

A total of fifteen initiatives were proposed for approval. The portfolio overview of initiatives is
scored based on quantitative and qualitative analysis using the company's estimated cost,
benefits, and resources. The planned timeline for HFE Portfolio execution is 20 months and
incorporates the Enable and Empower Program (EEP) and Defect-Free Production (DFP)
with interdependencies checked in place.

According to Table 1—Finance and Risk Analysis, seven initiatives (2, 4, 5, 7, 11, 12, and
14) stand out as key components for the HFE portfolio under the category of Distribution,
Infrastructure, Support, and Manufacturer. The selection was due to the strong indication of
financial performance (high financial score, high MCA) and the complemented aggregation
between EAE and DFP programs.

Considering Trendy PC's existing values as a small PC and laptop manufacturer whose
reputation depends on product quality and after-sales services, the identified initiatives are
well-aligned with Trendy PC's current corporate strategies and available budget.

However, it is important to note that selected initiatives should be accompanied by a suitable

project implementation methodology. In Trendy PC's case, Agile is the best option due to its
project flexibility and adaptability, which allow quick adjustment and identifying priorities.
Another method to consider is Kanban, which can further add workflow visualization and
early awareness of interdependency.

As the HFE portfolio was limited to theoretical quantitative and qualitative analysis, there are
several critical recommendations for Trendy PC to consider and further expand on.

 Engage with stakeholders to build towards an established roadmap for initiative

goals.
 Develop ongoing program management to evaluate progress, performance and risk.
 Invest in resource planning in terms of manpower skills (where additional training
may be required for personnel) and improve funding arrangements.

17
 Trendy PC – HFE Portfolio Management Proposal

8. References
Agile Alliance. (2001). Manifesto for Agile Software Development. Retrieved from
http://agilemanifesto.org/
Atlassian. (2024, May 02) What is kanban?. Retrieved from
https://www.atlassian.com/agile/kanban
Business Map. (n.d.). Continuous Flow: Heijunka. Retrieved from
https://businessmap.io/continuous-flow/heijunka#:~:text=Heijunka%20is%20a%20Lean
%20method%20for%20reducing%20the%20unevenness%20in,in%20the%20best
%20possible%20way.
Checkland, P. (2000). Soft systems methodology: A thirty year retrospective. Systems
Research and Behavioral Science, 17, S11-S58
Cvetković, N., Morača, S., Jovanović, M., Medojević, M., & Lalić, B. (2017). ENHANCING
THE AGILITY AND PERFORMANCES OF A PROJECT WITH LEAN MANUFACTURING
PRACTICES. Annals of DAAAM & Proceedings, 28.
Dodgson, J. S., Spackman, M., Pearman, A., & Phillips, L. D. (2009). Multi-criteria analysis:
a manual.
Eik-Andresen, P., Landmark, A. D., & Johansen, A. (2015). Managing cost and time in a
large portfolio of projects. Procedia Economics and Finance, 21, 502-509.
Hazzan, O., & Dubinsky, Y. (2008). Agile software engineering. London: Springer-Verlag.
Humphrey, W. S. (1987). Characterizing the software process: A maturity framework.
CMU/SEI-87-TR-11. Pittsburgh: Carnegie Mellon University, Software Engineering Institute.
Hunter, R. & Westerman, G. (2009). The real business of it: How CIOs create and
communicate value. Harvard Press.
Kurihara, T., Kawanaka, T., & Yamashita, H. (2019). Dual approach to the harmonized model
between inventory reduction and Heijunka (production leveling) based on the minimum
average-energy principle. International Journal of Industrial Engineering, 1(2), 138-153.
Royce, W., (1970). Managing The Development of Large Software Systems, IEEE
Computer Society.
Schwaber, K., & Beedle, M. (2002). Agile software development with Scrum. Upper Saddle
River, New Jersey: Prentice Hall.
Singh, J., & Singh, H. (2009). Kaizen philosophy: a review of literature. IUP journal of
operations management, 8(2), 51.
Sliger, M. (2011). Agile project management with Scrum. Paper presented at PMI® Global
Congress 2011—North America, Dallas, TX. Newtown Square, PA: Project Management
Institute.
Study.com. (2024, May 08). What Is Kaizen in Management? - Definition, Examples &
Process. Retrieved from https://study.com/academy/lesson/what-is-kaizen-in-management-
definition-examples-process.html#:~:text=There%20are%20five%20principles%20that

18
 Trendy PC – HFE Portfolio Management Proposal

%20kaizen%20follows%2C%20including%20(1),the%20productivity%20of%20the
%20company.
Thorpe, J. (2003). Information Paradox. McGraw-Hill Inc., US.

19