598: Every product manager should care about innovation portfolio management – with Noel Sobelman

Innovation portfolio management connects strategy and execution Watch on YouTube

TLDR

In this episode, I’m interviewing Noel Sobelman, author of Innovation Portfolio Management, about how organizations can bridge the gap between strategy and execution through effective innovation portfolio management. We discuss the structure, governance, and decision-making processes behind managing innovation portfolios, practical insights from real-world examples, and the growing impact of AI on portfolio management.

Introduction

Most leaders will tell you innovation is a top priority. But ask a more pointed question: is your portfolio actually funding the right bets? In many organizations, that will show how little of a priority innovation actually is. The money keeps flowing to safe, incremental projects while the bets that could grow the business are ignored. 

My guest has spent 35 years closing that gap. Noel Sobelman is an innovation and product development lifer. He ran product lines at Motorola and Honeywell before spending 25 years helping companies systematically innovate, now as a partner at Accel Management Group. He’s the author of a new book, Innovation Portfolio Management: Linking Strategy to Execution. We’ll discuss how you actually build an innovation portfolio. Should your big innovation bets live separately from your existing products? And how AI is impacting portfolio management.

Summary of Concepts Discussed for Product Managers

Every Product Manager Should Care about Portfolio Management:Noel explains that portfolio management affects product managers every day, even if they’re not directly in charge of the portfolio. Portfolio management determines which projects get resourced, and product managers need to be able to advocate for the products they believe should be prioritized to best meet customer needs. It is important for product managers to understand the selection mechanism used in portfolio management, so they can champion their ideas effectively and help the company make strategic trade-offs.

Connective Tissue between Strategy and Execution:Noel breaks down how strategy set at a corporate level cascades through business units and product lines, emphasizing the need for clear decision-making structures. Practical tools and routines such as quarterly portfolio reviews allow organizations to regularly adjust their portfolio in response to market shifts, resource constraints, and emerging technologies.

Real-World Example: Medical Device Company:Noel describes a medical device company whose top-down business goal to grow 10% year-over-year was not supported by the safe bets and incremental innovation that each business unit was doing. The company fixed this by agreeing on evaluation criteria to prioritize projects. They used quarterly decision-making forums to connect strategy and execution and decide on their portfolio. An analysis team made recommendations about product prioritization to the decision-making team. Using these improved processes, the company shifted resources toward breakthrough initiatives, increasing its oppor