How Portfolio Managers Facilitate Decision Making

Managers of small biotech groups can make decisions that drive R&D as long as they utilize the essential elements of organization in Bio/pharmaceutical R&D – Stage/Gate management, Therapy Areas, and Project Teams.  Start-up companies can get by without even these elements.

As the project portfolio grows it will reach a size (>50?) where there is too much information for a volunteer to process, and too much at stake for the managers to rely solely on personal experience and instinct to make decisions about portfolio prioritization, portfolio value, and portfolio risk.  The company may decide to assign the task of portfolio management to specific individuals as portfolio managers who will collate project information across the portfolio to create analyses that support/challenge various scenarios for executive decision making.   Portfolio managers should check project data integrity.   Portfolio managers should not be a part-time volunteer position.

Role in Decision Making  Portfolio managers do not make corporate decisions. Portfolio managers frame portfolio data around potential choices that will be deliberated by senior management. Portfolio managers are typically charged with the following responsibilities.

  • Decisions rarely wait for analyses. The portfolio manager must be in a position to know what decisions are coming up and get the analyses to the decision maker as soon as possible. If the analysis takes too long, a decision will be made without it.
  • Be sure that all relevant data that supports AND challenges various potential choices are brought to the attention of senior management.
  • Present such data in as straight forward a manner as possible. Know whether your senior manager is a verbal learner or a visual learner. For a verbal learner, reduce the data to ONLY a few precise bullet points. Have supporting bar/bubble/pie charts ready as backup material, especially for the visual learners. Distribute to senior managers in advance of the decision meeting.
  • Respond to further queries about the supporting data in a timely fashion. Managers will need this information while the data is fresh on their minds.

Portfolio management can support decision making in a variety of ways, depending on how the decision will be made.

One – the most senior manager as decision maker. Typically for adhoc (one-off) decisions, typically requiring one-off data analyses.

Many – the manager’s senior staff or a cross-departmental decision making group as the decision making body. Typically routine decisions delegated to the group, such as project initiations, milestone progressions or terminations, or periodic portfolio reviews and prioritizations. Such decisions are often supported by standard portfolio analyses showing the overall health of the portfolio, perhaps contrasting a project or subset of projects to the rest of the portfolio. The decisions may also require one-off data analyses to address particular themes, e.g. changes in strategy. It is important that a fully empowered matrix management committee equitably focuses attention on project goals, resources and timelines and drives the organization to timely decisions at each project milestone.

The portfolio manager may be better positioned to manage the decision making meeting than a line manager due to lack of bias and overall awareness of the portfolio.

Whether it’s the most senior manager or a delegated group of managers who are making the decision, the role of the portfolio manager is to work with the decision makers to ensure that the portfolio of projects will fill the development pipeline as needed with the suitable clinical candidates aligned to development portfolio requirements.