Download Chapter Four Project Portfolio Management Project Portfolio

Project Portfolio
Management
Project Portfolio
 A portfolio is a collection of projects or programs and
other work that are grouped together to facilitate
effective management of that work to meet strategic
business objectives
Project Portfolio Management
 At individual project level it is important to know each project is
performing, the impact of each project on the portfolio is just as
important. The following questions should be asked:
 Does each project contribute to the overall achievement of
the portfolio?
 How well is each project performing?
 Will any project have a negative impact on other projects to
come?
 What projects in the portfolio are dependent on others?
 Will the successful delivery of all projects deliver the desired
objective or benefit?
Project Portfolio Issues
 Are we doing the right things?
 Are we doing them right?
 Are we doing them well?
 Are we getting the benefits?
Why Project Portfolio Management
 Enables to use the resources efficiently
 Can get support of the Organization.
 Help organization to align its project work load to
meet its strategic goal.
 Make project managers life easier and more
rewarding.
 Central oversight of budget.
 Risk management.
 Improved ability to deliver project.
Why Project Portfolio Management
 Faster response to the changing circumstances.
 Focus on more important things.
 Do the right work.
 Do the right work faster.
 Use the right resources.
 Do the work right.
 Identify the problem and solve it easily.
PPM-Goals
 Helps the organization to make the best use of its
resources.
 Enables the removal of low value projects from the
portfolio.
 Ensures that all new and existing projects are
aligned with the organization’s mission, goals, and
objectives.
 Produces and maintains a comprehensive listing of
all projects which the organization is undertaking
PPM - Goals
 Develops a bigger picture view and deep
understanding of the project collection as a whole.
 Creates an objective methodology for identifying,
ranking, prioritizing and selecting new projects.
 Ensures that a healthy balance across different
types of projects with different cost, schedule,
complexity and risk profiles is maintained.
Scope of Project Portfolio Management
Opportunity
Identification
Project
Performance
&
Assessment
Program/Proj
ect
Management
and
Execution
ROI/ Value
forecast
Portfolio
Manage
ment
Work
Scheduling
Project
Prioritization
Capacity
Planning
Project Portfolio Management Process
 Determine a viable mix of projects that can
meet the organization’s goal.
 Balance the portfolio in terms of specific
categories of projects.
 Plan and execute these projects.
 Analyze the performance of the projects in
the portfolio to see if
warranted.
improvements
Project Portfolio Management Process
Conti…
 Evaluate new opportunities against the
projects including the existing and potential
projects against the organizations’ goals.
 Provide decision makers with the needed
information and recommendation.
Project Portfolio Management – Best Practice
Using Cross
functional
teams
Strategy to
prioritize and
screen
projects
Responsive to
external
environment
PPM
Best
Practices
Allocate
scarce
resources
Customer
Orientation
Tough Go/
Kill decision
points
PPM - Benefits
 Justifies killing projects that do not support
organization strategy.
 Balance risk across all projects.
 Links project selection to strategic metrics.
 Prioritize project proposals across a common set of
criteria, rather than on politics or emotions.
 Allocate resources to projects that align with
strategic direction
PPM - Benefits
 Improves communication and supports agreement
on project goals.
 Builds discipline into project selection process.
 Provides executive oversight of the firm.
 Provides the structure/process for project portfolio
governance & avoids duplication/ waste.
Project Portfolio Management
Tools
 A tool to facilitate your PMO (Portfolio
Management Office) function;
 Providing data acquisition and management
 Supporting project selection, resource allocation
 Reporting and graphing
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