Northmoor Council: 40 Initiatives and a £95m Envelope
Northmoor Council is a district authority with a five-year capital envelope of £95m and 40 candidate change initiatives submitted by six directorates; the combined estimated cost is £210m. The new portfolio director inherited a spreadsheet in which initiatives appear in the order they were submitted. There is no common set of categories: a mandatory children's services case-management upgrade (statutory deadline in 14 months), a £6m office consolidation with a three-year payback, two overlapping 'digital channel shift' proposals from separate directorates, and nine small 'we would like to' improvements all sit side by side. The chief executive has told the portfolio director to 'get on with the ones that are furthest along so we can show momentum before the inspection'. There is no agreed view of how the portfolio supports the council's medium-term financial strategy, and the portfolio office consists of one analyst working two days a week.
1. The portfolio director proposes to accept the chief executive's instruction and sequence initiatives by readiness. Which steps of the portfolio definition cycle has Northmoor skipped, and what specifically goes wrong as a result?
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The definition cycle is Understand → Categorise → Prioritise → Balance → Plan. Northmoor has done roughly half of Understand (a long list exists, but the portfolio's contribution to the medium-term financial strategy has never been articulated), and has skipped the middle three steps entirely. What exists under the name 'Plan' is a readiness order, which is not a plan in MoP terms.
The reasoning matters more than the labels. Readiness is a measure of momentum, not value; ordering by readiness systematically favours initiatives with the loudest sponsor and the earliest start, not those that serve the strategy. With £115m of unfunded demand, the gap will be closed by whoever pushes hardest, which makes the portfolio indefensible when a member asks why their scheme was cut. It also destroys any basis for balance: tactical quick wins, statutory obligations and strategic transformation end up competing on a single axis. Finally, the 14-month statutory deadline is a hard constraint that readiness ordering gives no guarantee of protecting.
The recovery is not to restart the cycle formally but to run it in a compressed, evidence-light form: restate the portfolio's purpose against the financial strategy, categorise, agree three or four prioritisation criteria, balance, then plan. Statutory items should be carved out as a pre-commitment before the rest is ranked.
2. How should categorisation be used at Northmoor, and why is it not a substitute for prioritisation?
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Categorisation groups initiatives by type so that like is compared with like. Sensible categories here would be: statutory/compliance (the children's system), efficiency and income (office consolidation), transformation/enabling (channel shift), service improvement (a subset of the nine small items), and growth/regeneration. Two benefits follow that no amount of scoring can deliver on a flat list.
First, categories justify different criteria. Ranking a statutory system by payback period is nonsense; it belongs in a 'must do' tier with its own assurance and its own funding line, removed from the competition before the remainder is prioritised on value and cost. Second, categories make balance visible. A portfolio that is 85% statutory and efficiency and 0% transformation is not delivering the strategy, however well each item scores.
What categorisation does not do is decide. Within the efficiency category, the office consolidation still has to be ranked against other candidates using agreed criteria; within transformation, the two overlapping channel-shift proposals must be resolved - and here categorisation does real work, because they plainly serve one objective and should be merged into a single initiative with a single business case. Merging before prioritising removes duplication from the demand line instead of ranking two versions of the same thing. Categorisation is a structuring device; prioritisation is the judgement.
3. How would you evidence within twelve months that the portfolio approach is working, and what would you do about a portfolio office that amounts to 0.4 of a person?
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Evidence should be about decisions, not documents, because the failure mode of a new portfolio process is that it produces artefacts nobody uses. Useful measures: the proportion of portfolio spend traceable to a named strategic objective (currently close to zero); the number of initiatives with a named senior owner and, separately, a named benefits owner; the value of duplication removed before investment; decision lead time from submission to funding decision; and the balance profile across categories against the intended one. A single-page portfolio dashboard, reconciled with finance, is the artefact that earns the office its credibility.
On capacity, MoP expects a portfolio office function but does not prescribe its size - it prescribes what it must do: inform, advise and support decisions on the whole portfolio. A 0.4 FTE analyst cannot do that across 40 initiatives, and pretending otherwise guarantees that the function is ignored. Three practical moves: formalise a virtual portfolio office with a named lead plus a contact in each directorate PMO, so the work is distributed but the standard is single; narrow initial scope to the top 15 initiatives by value, covering most of the spend and therefore most of the risk; and secure an explicit written mandate from the chief executive, because without senior management commitment the office can produce information but cannot say no - which is precisely the point of having it.