In the beloved classic children’s book Millions of Cats by Wanda Gag, an old man and an old woman decide to get a cat to be their companion. The Old Man sets out to find a pretty cat, and he comes across a valley full of…
“…hundreds of cats, thousands of cats, millions and billions and trillions of cats.”
How Clutter Happens
Clutter in Real-World Portfolios
However, this leads to a portfolio cluttered with lots of projects, often with no clear way to compare their worth. Each project needs care, attention and feeding, and with so many, there’s no way to ensure that they all get enough resources to reach their full potential.
Wounded Projects, Hidden Upsides
In fact, a project with huge upside potential may be nearly unrecognizable as such. Perhaps it has been starved of attention, resources, or vision, and so it looks small and scraggly. By taking a closer look to see what its upside potential really is, you may find that it has every chance of growing into a pretty, plump and profitable business if it gets the care and feeding it needs.
The key to having enough attention and food to give to your best projects — the ones with the best chances of growing into their upside — is to stop squandering attention and food on projects that will never make a big contribution to your business, not even if they reach their greatest potential. This requires you to have and use a tool for making credible and comparable evaluations of all of your projects. You can then identify which projects have strong upside potential and which ones will not significantly move the needle, even if they are completely successful.
And it requires that you act on those evaluations. You must decide what to do with your weakest projects. Do you abandon them outright and redirect the resources they were consuming to your more promising projects? Or do you look for hidden sources of significant upside within weaker projects and, if and when you find them, figure out ways to refocus or pivot those projects to strive for that upside?
Distinguish Clutter from Value in Your Portfolio
What’s hard is deciding to back a project with uncertain prospects of success but that, if successful, will make a big contribution to the company’s continued success. It’s even harder to create a learning plan that guides you to finding out early on whether the project is viable and whether the perceived sources of upside are real. That learning plan will keep your focus on validating that upside, capturing it if it proves real and, if it isn’t real, pivoting quickly to better uses of your resources.