1) The document discusses portfolio management perspectives on governance and risk from two guest specialists - Lynne Ratcliffe from Yorkshire Building Society and Paul Morgan from SABMiller. 2) Lynne Ratcliffe discusses Yorkshire Building Society's approach to portfolio governance, including risk management processes, benefits management frameworks, and flexible governance based on assessment of complexity, capability and impact. 3) Paul Morgan outlines SABMiller's governance process involving demand approval and project delivery, underpinned by delegated authority levels to keep decision making relevant. He emphasizes accurate demand and project forecasting to provide a clear portfolio financial view.

1. 1
Portfolio Management Perspectives on
Governance & Risk - two big challenges)
5th July 2016
(2nd part of the SIG’s 2016 AGM)

2. 2
Introductions
• Your host for this session – Nancy Olson
• Guest Specialists:
• Paul Morgan – SAB-Miller
• Lynne Ratcliffe – Yorkshire Building Society
• Jo Matthews – Yorkshire Building Society
• Pauline Stewart-Long - Chair of the Pharmaceutical
Industry Project Management Group (PIPMG)

3. 3
Outlining the Approach
Guest Specialists
Will use a Questions Framework to highlight some of their examples
Discussion Groups
Audience splits into 2 groups
Each group adds their views/experiences to answer 1 of 2 “Powerful Questions”
Each group to use flipchart to capture key points raised
Feedback
Representative from each group to present main highlights

4. 4
First = Portfolio Governance
• Lynne Ratcliffe – Yorkshire Building Society
• Paul Morgan – SAB-Miller

5. 5
Portfolio Governance
Brilliant Basics
Effective Portfolio decisions can only happen if the data feeding the process is accurate current and timely.
Starting Q3 2014 - back to basics:
• Risk Management – escalation, alignment to enterprise risk
• Milestone Management – key mandatory tracking milestones
• Benefits Management - developed a new benefits management framework
• Reporting – actual and forecast data in PPM tool to enable stronger reporting capabilities to the chiefs and board
• Flexible, risk based governance (and Assurance)
• Based on the result from our Value & Feasibility assessment tool which looks at Complexity, Capability,
Impact, Cost and more
Hygiene Factors
Focus on 4 areas – Delivery, Risk, Finance & Supplier – Monthly focussed Boards
Approval Boards
Investment Committee – In terms of change the focus is only on the business case and if it stacks up. If it does, the
project is approved to go to Change Board.
Change Board – Decide if the project aligns to our strategy and if so approves the schedule, resourcing and
drawdown of funds. Also monitors the portfolio and makes keys decisions (and recommendations to board when
necessary) about the shape of the Portfolio and what changes we should make. CPMO is becoming the go to team
to provide recommendations to the Change Board for them to ratify rather than giving them all the options to make
a decision on. This makes the Change Board meeting more effective in the way it runs.
Lynne Ratcliffe – Portfolio Governance Manager, Yorkshire Building Society Group

6. July 2016
SABMiller
Paul Morgan
Head of Demand & Portfolio Management
Global Business Services

7. © SABMiller plc 2014
Governing Demand through Delivery
7
1. New Demand
(not currently in
approved portfolio)
2. Approved
Demand
3. Projects
DEMAND DELIVERY
Business Partner / Demand Owner responsible Solution Delivery responsible
4. Financial Management of the portfolio
Refinement of cost profile
for new demand

8. © SABMiller plc 2014 8
Trade-off - “What’s to
come out, for this item to
come in?”
High-level business
case to proceed
General demand
process (requirements,
high-level design, FBC
relevant endorsements
by our business and
global teams)
Some delegated
responsibility - projects <
$1m receives full release
of funds during the
demand approval.
Deviations fed into the
portfolio
DEMAND DELIVERY
Underpinned by delegated levels of authority / approval
rights that keep decision making relevant
Exception reporting tied
into monthly reviews with
each regional portfolio team
Regular forecasting for both demand and projects to provide
accurate portfolio financial view at all times
All 3 chevrons
Clear acceptance criteria
for an item to move through
Some Additional Notes

9. 9
Portfolio Governance - Discussions
Portfolio Governance Questions:
1. What are the key do’s and don’ts of an Investment Committee?
2. What are the key links between Project Governance and Portfolio
Governance and how can we work better together?

10. 10
Second = Portfolio Risk
• Jo Matthews – Yorkshire Building Society
• Pauline Stewart-Long - Chair of the Pharmaceutical
Industry Project Management Group (PIPMG)

11. 1
Portfolio Risk
Brilliant Basics
Effective Portfolio decisions can only happen if the risk and issues data feeding the process is accurate current and
timely.
• Risk Management refresh to ensure risks are flushed out top down and bottom up
• Equipped teams with the tools to support Portfolio Risk identification
• Enhanced On-Boarding, training sessions and risk SME introductions
• Reporting - automatic risk data extraction across the portfolio
• Mandatory risk requirements dependant on risk assessment of project – Bronze Silver Gold.
• Compliance and Quality checks to uplift quality of data submissions
• Risk profiling for the risky projects – how much risk the project is exposed to at points through out the lifecycle
• Defined and well articulated scoring matrices by level – Project Programme / Portfolio
Enterprise Wide Risk Management
• Control Self Assessment of Change BAU processes to stay on top of risk created by your processes
• Portfolio risks connected up to inform Group wide Change risks
Hygiene Factors
Risks escalated from our monthly Delivery, Finance & Supplier Boards escalated to Portfolio Risk Assurance Board.
Following review at Portfolio Risk Assurance Board, Portfolio Risks are then escalated to Change Board
Joanne Matthews– Principal Change Risk Assurance
Yorkshire Building Society Group

12. Portfolio Risk in the Pharmaceutical Industry
Pauline Stewart-Long

13. Corporate Management
Committees
Business Unit
Project Team
Line Activity
Decisions
Strategy
Operation
Decisions
Strategy
Operation
Decisions
Strategy
Operation
Project Plan
Line Plan
Corporate
Strategic Plan
Business Plan
Portfolio
Management
Asset or Product Strategy
PortfolioRiskFocus
Pharma Portfolio Governance is a continuum
Project
Management
Business Area Strategy
Project
Management
Portfolio
Management

14. Informing Portfolio Risk discussions
Decisions
• Priority
• Strategy & Plan
• Resource allocation
The “Board”
Forecast
Estimates
Time
Estimates
Cost
Estimates
Risk
Evaluation
Pipeline

15. Characterising the Portfolio Risk (R&D)
• Technical risk
– failure of the ‘science’
• Operational risk
– failure to meet the plan
• Regulatory risk
– failure to gain approval
• Commercial risk
– failure to deliver the “product”
• Financial risk
– failure to achieve the forecasts.

16. Managing the Portfolio Risk
Many projects in pharma are inter-related
– Project interactions may be captured in the risk
BUT - a portfolio of 100 projects could have ~ 10 84
outcomes
• Identify any risks that can impact the corporate strategy
• Monitor the external environment for changes
• Ensure all projects use the same core assumptions
• Look for interactions between projects
• Understand the impact of individual project changes

17. 17
Portfolio Risk - Discussions
Portfolio Risk Questions:
1. Characterise portfolio risks and what is needed to ensure they are
identified, defined and managed effectively? How should they be
managed differently to programme and project risks?
2. Strategic portfolio risks should be owned by an Exec or a Board
member. How can we manage these stakeholders and embed portfolio
risk management into the exec governance process?

18. 18
Next Steps
1. Write up outputs from today
2. Use to aid future SIG research
3. Add to our extensive knowledge base
4. Possible joint venture with other SIGs (e.g. Risk SIG)

19. 19
Closing Comments
Thank you to everyone for your contributions this evening
Look out for more PfM SIG events and activities
[Especially our 2017 Conference................]
You may contact us here : portfolioSIG@apm.org.uk

20. This presentation was delivered
at an APM event
To find out more about
upcoming events please visit our
website www.apm.org.uk/events