Adaptive Portfolio Management Based on Complexity Theory and Sociotechnical Design

Current market contexts are pushing leaders to face the need for new business paradigms and to adapt their organisations to an ever-faster changing, dynamic and even unpredictable world. Organisations are requiring new ways of operating and new IT governance approaches that allow them to act quickly while remaining alert to the signals of the environment in which they operate. In this sense, we have focused our work on the design and implementation of an Adaptive Portfolio Management (APM) approach based on complexity and sociotechnical design principles in two Spanish organisations. After some Action-Research cycles, we conducted a situational analysis phase through several focus groups, the results of which are presented in this paper. Our findings show that the sociotechnical approach has brought to light the interrelationship between the governance model and other dimensions such as strategy, operating models, organisational design, people and culture, and technology. One of the key findings of the diagnosis is that, by implementing a governance model devoid of deterministic principles, we can readjust the other dimensions and introduce changes to facilitate the organisation’s ability to adapt to dynamic environments.