Skip to main content Skip to footer
Project management

The complete guide to lean portfolio management 9 min read
Get Started

Everybody’s got different ways of doing things, right? Some of us like to eat our meat before the veg, other people go straight to dessert, and some people stick to tofu.

Portfolio management is no different.

Portfolio management is all about choosing the right projects or investments your organization will need to take on to achieve its goals.

But there are different methodologies and styles you can use to choose your projects or investments — and one of those styles is called “Lean” portfolio management.

It might sound complicated at first, but if you sift through all of the enterprise theory, it’s actually a pretty smart and simple way of keeping track of all the stuff your organization has to play with.

This article will explain what Lean portfolio management is, the principles behind the Lean methodology, and how you can use to exercise a Lean portfolio management style.

Get started with

What is Lean management?

Before we delve into how a Lean management style can be applied to portfolio management, we’ve got to talk about what it is that “Lean” actually means.

What is a “Lean” management style?

“Lean” is a management and quality improvement style that a lot of Agile managers use to focus on waste reduction.

A lot of management junkies consider Lean management to be more like a business philosophy than just a tool or method that can be applied sparingly. That’s because to be effective, you’ve got to apply Lean thinking to every aspect of your Agile portfolio operations and supply chain.

This Lean philosophy was first deployed by carmaker Toyota. The company decided to implement a stringent regime in which they focused on reducing excess waste in each process of its Toyota Production System (TPS).

The result? Production costs went down, lead times dropped, and quality was improved.

The same Lean philosophy can be applied to project and portfolio management.

Screenshot of's Resource Management template

In project management, most teams end up with excess waste in the form of unnecessary planning, unproductive meetings, too much documentation, avoidable amends, unproductive multitasking, resource management, and more.

By deploying the 5 principles of Lean management to all of these project management elements, you can strip all that waste right back to reel in the maximum economic benefit of each portfolio item.

What are the 5 principles of Lean management?

There are 5 basic principles that you’ve got to consider when using a Lean management style in your project or portfolio.

  1. Identify your customers and specify value
  2. Identify your map and value stream
  3. Eliminate waste
  4. Respond to customer pull
  5. Pursue perfection

Screenshot of chart showing the 5 principles of lean portfolio management

Some of these areas are more self-explanatory than others — but we’re happy to walk you through each one just to make sure we’re all on the same page.

Identify your customers and specify value

First, Lean governance starts with clearly identifying your team’s objectives, and using those to set criteria.

Choosing the right project means satisfying the needs of all your customers or company stakeholders — so to introduce a Lean management style, you need to know who your stakeholders are and what they want.

Identify and map your value stream

Every team has a value stream. It’s just a fancy way of describing all the actions that you’ve got to take to finish a project or a product — and understanding your value stream is critical to Lean portfolio management.

By identifying all the steps you’re taking to finish a project or complete a task, you’ll figure out in a safe environment which steps are required, which steps are totally pointless, and where Lean budgeting could save you big time.

Create a value flow and eliminate waste

This is the part of the Lean portfolio management function where you start getting stuff done.

After you’ve mapped out your value stream, you’ll be able to eliminate waste wherever you find it. After eliminating that waste, you’ll be able to create what the head honchos in finance like to call a “value flow.”

What’s a value portfolio flow? It’s a resource efficient process that ensures every step of the production, management, or selection process is as waste-free as possible.

Get started

Respond to customer pull

Another critical principle of Lean portfolio performance is that you should be responding to customer pull.

That means you react to demand without wasting resources, time, or money doing stuff that nobody wants you to do. Instead, focus on providing only the goods or services that you’ve got demand for.

In manufacturing, good LPM performance will minimize your budgeting losses and overheads — and in project portfolio management, it lets you moderate your flow of projects based on demand for your team to complete those projects.

Pursue perfection

The most important element of the Lean management philosophy is this: the job is never done.

No matter how efficient things look right now, you’ve got to constantly reassess your processes and measure against KPIs to make sure you’re wasting as little and working as efficiently as possible.

You may never reach peak operational excellence — but the point of Lean and Agile management is to get as close to perfection as humanly possible.

What is Lean portfolio management?

We’ve talked about Lean management and how it works. Now we can finally answer the question you came here for: what is Lean portfolio management?

Lean portfolio management (LPM) is the process a portfolio or product manager uses to execute a portfolio strategy that minimizes waste and maximizes efficiency.

During the Lean portfolio management process, a Lean portfolio manager or project manager will deploy those 5 principles we talked about to select, prioritize, and control an Agile portfolio without producing loads of wasted resources or unnecessary budget expenditures.

Lean portfolio management is designed to increase value, remove obstacles to a team’s delivery cycle, and prevent bottlenecks so that funding for capacity is always balanced with demand for high-value opportunities and your team’s future state.

Some Lean portfolio managers choose to take on a special course or achieve an LPM certification — but training on a Lean portfolio management course isn’t required if you want to implement a safe Lean portfolio management style. You just need to remember your basic principles.

You’ll also hear about Lean portfolio management in a financial context.

A Lean portfolio of investments consists of assets that the portfolio manager is actively curating to ensure every investment aligns with the investor’s business strategy. Again, the goal is to deliver value in relation to investment funding and make sure the portfolio is Agile enough to change when required.

Screenshot of pyramid chart showing priorities behind lean management style

(Image source)

What’s the difference between Lean portfolio management and traditional portfolio management?

Unlike traditional portfolio management, Lean project portfolio management focuses on bringing work to your team — instead of bringing your team to the work.

That just means Lean portfolio management is customer or client-centered. With a Lean portfolio management style, you should always rest assured that you’re not wasting time on a project without demand for completion.

Lean portfolio management also places more emphasis on defining and meeting desired outcomes, rather than just the quantity of your outputs. It’s all about defining “value” and actively managing your finances, resources, and assets with that value in mind.

Get started

How can you use for Lean portfolio management?

Portfolio management is pretty easy to talk about in theory. Actively managing a portfolio is a whole different story.

As a portfolio manager or a solution manager, you’ve got to keep tabs on business initiatives, and how each project is helping to fulfill those objectives.

Plus, you need to make sure that your resources and finances are always being distributed to portfolio items in a way that maximizes efficiency, enterprise agility, and is led by stakeholder demand.

Unless you’re Albert Einstein’s great-great-grandchild, keeping track of all that in your head is basically impossible, especially without proper training and experience — that’s why so many Lean managers try to get a course certificate.

But if you’ve got a reliable Work OS (operating system) on your side, you’re already dressed for success.

Portfolio managers use Work OS platforms to quickly update, share, and maintain portfolio information about different projects, assets, or investments. And would you believe your luck? Capterra has sitting in the number 1 spot for project portfolio management software.

Why, you ask?’s Portfolio Management template shows you all the totals you’ve got invested in companies or distributed across different projects, the resources you’ve already allocated, and everything about inactive investments that are no longer on the roster.

Screenshot of's Portfolio Management template

With, you’re going to get practical tools like dozens of app integrations, visualization styles like Gantt chart or Kanban, and amazing customer support.

But specifically on the Lean management front, you’ll benefit from an additional column to record who’s responsible for each portfolio item.

You also get flexible interaction so that team members can dissect the portfolio data however they want and a quick start-up that automates the onboarding of new portfolio info.

Sounds good, right? That’s what we thought, too.

So, what have we learned?

Project portfolio management is full of wasteful activities. You’ve got excessive documentation, planning protocols, wasteful meetings, avoidable tasks, and inefficient resource distribution.

But if you implement a Lean portfolio management philosophy, you can get rid of a lot of that waste and maintain an Agile portfolio.

Lean portfolio management is all about deploying those 5 basic Lean principles to make sure your portfolio strategy and budget align to deliver value, provide business agility, and ax waste. is totally equipped to help you streamline that Lean management process.

So, are you ready to supercharge your Lean portfolio management?

Get started

Get started