As well as requiring a new definition of scope, the move to Lean Portfolio Management creates an opportunity to introduce new enduring measures of success. These are likely to be multi-faceted.
The recommendation is to start with a measure of customer value and a measure of cost as the primary measures of success – incentivising the delivery of value for money. Commercial organisations will often use revenue as a proxy for customer value, meaning their overall measure of success becomes profit (revenue over cost), although there are significant downsides to focusing on money as a short-term measure over a longer-term measure of customer value. For non-commercial organisations, this is often less obvious, will be different in each case, and will likely require proxy measures. One example might be measuring usage (in both people and time) as a proxy on the assumption that the more valuable users find the service, the more they will use it (assuming there is some level of choice). Customer feedback is also likely to be a large part of this. For enabling services where there’s an element of recharge, revenue could also be used. These metrics are likely to endure but should be regularly reviewed and adjusted to ensure they accurately reflect the benefit and value that’s being delivered. Ultimately, they are an agreement with the parent portfolio as to how success will be measured.
The successful delivery of objectives should always be a key measure of success, but potentially secondary to customer value and cost. It is unlikely that an objective should still be prioritised if it becomes clear the delivery of it will reduce customer value and/or increase costs without extenuating circumstances.
To supplement these, you should consider some enduring performance measures to understand performance, how effective and efficient delivery is, and where there may be opportunities for improvement. This should include key metrics of the delivery of change, run (including the usual operations metrics) and innovation. It should also include competency measures, for example through independent maturity assessments, to identify where potential improvements lie and where good practices can be identified for sharing with other portfolios.