Zero-based Portfolio Prioritization: Streamlining Success Strategies


Zero-based Portfolio Prioritization: An Introduction

Staying ahead of the competition today is increasingly challenging. Organizations are typically not short of ideas of how to go about this. They have a long list of projects that might bring it about. Yet, actually delivering those projects in a sufficiently timely manner to make a difference is often the most problematic part of getting ahead. The issue is that while great ideas are not scare, usually resources are. Having the people and budget to do everything the organization seeks to in a time frame that will make a difference in delivering strategic objectives that will bring about competitive advantage. This is where a key competence of prioritization really adds value. The zero-based portfolio prioritization process can be extremely beneficial to this. But first, let us consider the importance of prioritization to your portfolio, and to your business.

Maximizing Returns Through Zero-based Prioritization

If you are not already convinced about the need for robust prioritization of projects, there is plenty of good evidence that suggests it can really make a difference. First, return on investment is greater. Studies have shown that projects that are prioritized are more likely to be those that will drive greater return on investment, or more value overall. This is because they are more likely to be better aligned to meeting the organization’s strategic goals. Furthermore, projects that are more closely aligned with strategy have a much higher chance of being delivered. Initially, 45% more likely to budget. On the other hand, 50% more likely on time.

Leadership Support in Zero-based Portfolio Management

Second, better support from senior management and other key stakeholders. As research suggests, another good reason for prioritizing projects effectively is that when projects are clearly linked with strategic imperatives, they have a 57% greater likelihood of success. This is to come about for a number of reasons. One is that there is more likely to be engagement with these projects at a senior leadership level. This means that they also have a greater level of energy behind them. Hence, the resources needed are more likely to be available to deliver them.

Cutting Waste with Zero-based Portfolio Strategies

Third, it cuts out waste. Prioritization also ensures that organizations are focused on projects that will add value to the organization, rather than those that are no longer relevant. All too often organizations keep plugging away at old projects that may no longer be what they should be focusing on. These projects suck up resources that could be much better used elsewhere. From my experience of portfolio management, I have observed that up to – and on some occasions over – a third of a portfolio can be based on projects that are past their best and that need to be scrapped.

Resources stretched too thinly when focus is not on the most important projects. This means that bottlenecks of critical resources can build up, leading to backlogs that can delay business-critical projects unnecessarily. By prioritizing projects effectively, people are freed up to work on those that really matter. This will have the joint benefit of being more motivating for them as well.

The bottom line is that if organizations are holding onto projects that are obsolete and wasting resources on them. They are limiting their possibilities of responding quickly to those projects that they should be working on, to succeed. This is why robust project prioritization is essential.

The Essentials

The importance of project prioritization in the portfolio has been established. Let us now turn to the zero-based portfolio prioritization process. Evidently, it brings opportunities to really drive change. It is assessing project priority effectively to ensure that resources are focused 100% where they need to be. Zero-based portfolio prioritization takes a similar approach to zero-based budgeting. The idea is that you start from scratch with prioritization based on the current situation. This means that each project has to be justified for it to continue receiving funds and resources. Critically, this process cuts out waste by making sure that everything is of value to the organization.

This does not have to be just in terms of return on investment, as projects may add value in other ways. However, each project must be justified. This means the organization re-focuses on what is important at the current time, rather than projects which might have been valuable a year ago but will now not have the same impact.


In short, current projects are paused in the zero-based portfolio prioritization process. Following this, each project is then re-evaluated. Merits at the current time are present. Each project needs to justify its existence based on the situation at this point. Thus, wasted resources will be identified with a fresh look at current projects. This identifies legacy projects which are no longer bringing the anticipated value. Consequently, spending both time and money will likely to add more value for these projects.

Letting go of legacy projects is not always easy. In some cases, some executive sponsors may apply a lot of pressure for the continuity of the pet project. However, it is important for everyone to adjust and move on from spending on projects like this, where they are no longer likely to deliver the hoped-for value. Times change, and the business must change with them. Zero-based portfolio prioritization offers a chance to achieve that effectively.


Project prioritization is important to eliminate waste within the organization, and to achieve competitive advantage. It allows organizations to be far more responsive to more immediate needs and to align resources with strategy. Zero-based portfolio prioritization has much to offer to this process. I plan to explore this in greater depth in upcoming posts. Next time I will look at how the zero-based portfolio prioritization process works in greater depth, explaining how you can go about it. Beyond that, I will also consider the role of the PMO in zero-based portfolio prioritization. Until next time, you are up to date.

Originally published at ProjectTimes