In the pursuit of organizational strategy, many companies are finding a wide gap between what they aspire to do and the reality of what they can do. While nearly all businesses recognize the critical nature of Strategic Portfolio Management (SPM), less than half feel their current processes are truly effective.That was the key takeaway from Broadcom’s recently released annual SPM study.
Brian Nathanson, Head of Product Management for Clarity at Broadcom, defined SPM as an evolution of Project Portfolio Management (PPM). “Strategic portfolio management aims to expand beyond projects, to encompass things like operational, products, infrastructure,” he told SD Times. The goal, he said, is to gain full visibility into all investments—not just the 20-30% typically considered new work—to ensure they advance the overall corporate strategy.
The major disconnect, according to Nathanson, is due to organizational siloing. When business units locally optimize data for their own goals, they create information silos that prevent a unified view of the portfolio. This happens despite nearly everyone agreeing SPM is critical.
“The challenge is that you’ve got all the information necessary for making those decisions spread across the organization and all of these different information silos,” Nathanson said. This results in decision-makers being “less than happy with the actual data and system or processes they have in place for making those decisions.” The daunting, expensive task of modernizing legacy systems is often delayed because there is “no cost locally to the business unit or whoever’s asking for continuing to leave the situation as is.”The Illusion of AI as a ‘Magic Button’
The survey revealed a near-unanimous belief, with 99% of respondents indicating that AI can provide benefits for optimizing the SPM portfolio. However, Nathanson warned that this enthusiasm overlooks a fundamental dependency: data quality.
“If your data isn’t consolidated and isn’t high enough quality, then the insights you get are going to either be hallucinated or at least going to be incomplete,” he said. He suggested that many leaders are “looking for the magic button to avoid that problem you were just describing, which is, I really don’t want to have to modernize all this stuff. So can I just use AI to, like, solve this problem?”
The reality, he cautioned, is that this is a “rude awakening.” Enterprises still need to grant AI access to the necessary data, which will inevitably require modernizing legacy systems to some extent.
The First Step: Visibility and Data Inventory
For organizations looking to move from PPM to a more holistic SPM approach, Nathanson advised starting with visibility. This is not just about throwing all data into a data lake, which he said “assumes all the data is actually valuable.” Instead, it requires a focused effort to identify and rationalize data.
“What you really want to do is spend time going through all of the data and all of your systems and determining which data really is valuable data, and then make sure that that data is accessible to the rest of the organization,” he explained. This starts with simple clarity: knowing where to go for what information, before moving to automation. Nathanson’s advice is to begin with a complete “application inventory or data inventory” to understand why data is being captured and if it is truly important for strategic decision-making.
The shift toward SPM also reflects a change in industry terminology. Broadcom’s prior study focused on Value Stream Management (VSM), a term that Nathanson said was “co-opted somewhat by the DevOps downstream aspects,” which most executives don’t focus on. Moving to the Strategic Portfolio Management term was an intentional effort to address the C-suite with a concept with which they were already familiar.