Wijnia, Y.C. and J.P. Warners: Portfolio Planning part 3: Making it work, pp. 19-20. In: Strategic Asset Management 184 (06-02-2006). [Salisbury]: AMQ International, 2006. International Academic Journal
In Issue 182 Ype Wijnia and Joost Warners introduced two highly important ideas for asset managers, risk governance and system inertia.
Whilst risk management is the valuation of technical opportunities and the province of the asset manager, they argue that risk governance is the valuation of the problem itself – how important is it to the organization in the overall scheme of things?
Systems inertia took this idea forward by noting that while assets have long life cycles, the technology behind them is even longer. What changes more quickly is the institutional environment within which the assets operate and provide service.
From this they developed their key strategic question – How do we manage rapid response to institutional requirements? They introduced their “Portfolio Planning Approach”
In Issue183, they spelt out how they generated a greater variety of projects to give themselves a genuine choice.
In this final part of their paper, they cover the issue of ranking projects under this approach in “Making the decision” and they evaluate their own approach, not with an eye to justification, but with an eye to continuous improvement.