There is so much to do and so little time. No doubt this resonates with you as an individual, but did you know that organizations struggle with the same problem?
There are a million projects a company could focus on at any one time, but trying to tackle them all would lead to overstaffing and poor results.
The solution? This is called Project Portfolio Management (PPM). It’s about prioritizing individual projects rather than just trying to figure out how to get as many of them done as quickly as possible. You might even think of it as product portfolio management, because ultimately it will improve the things you produce.
It’s a process that could totally change the way you approach the basics of project management as an organization.
Overview: What is Project Portfolio Management?
Project portfolio management might sound like a fancy way of saying project management, but the goal is quite different. While project management focuses more on the execution of an individual project, project portfolio management is more about when those projects are completed.
Under PPM, projects are managed as part of a portfolio that aligns with an organization’s strategy, allowing that organization to conduct analysis to determine whether it is best to undertake a project now or later. it must be replaced by another.
What are the main objectives of project portfolio management?
The problem is that organizations have a lot of projects they could work on, but a limited amount of resources. Instead of just piling projects onto overworked staff, an organization uses PPM to prioritize those projects. And this business portfolio has four key objectives.
1. Identify the best investment project
The main objective of the PPM is to identify where current investments and resources should go. Each organization is going to determine this differently depending on whether they are trying to achieve maximum profit in the short term or to achieve a longer term goal.
Either way, PPM clarifies where an organization should focus its resources, which provides clear direction to everyone involved and increases overall portfolio value.
2. Set a list of priorities to enable future planning
In addition to helping select the next project, PPM also creates a priority list that helps an organization plan and prepare for its next projects. This sets up these follow-on projects for success, and if planned correctly, they will build on past projects to maximize their effectiveness.
3. Provide a benchmark for future investments
Past projects managed under the PPM will help provide a baseline that will guide future organizational decisions about where to invest resources. If a type of project has not met expectations, this allows an organization to reprioritize and roll back similar projects, and conversely, to escalate successful projects.
4. Keep the organization focused
Taking on every project that comes along will cause an organization to become unfocused and reactive.
By prioritizing projects through the PPM, an organization acts according to a well-considered strategy. This long-term orientation avoids short-term decisions that could harm the future of the organization.
How does project portfolio management work?
It’s a complicated process, but the basics of PPM can be boiled down to the following steps.
Step 1: Create an organizational strategy
Before an organization can implement PPM, it needs to define a long-term strategy. This strategy should answer some basic questions about what the organization wants to achieve, and then drill down into the projects it needs to undertake to get there.
By exposing this strategy, it will make the PPM process much clearer rather than guesswork.
Step 2: Determine how the project will be judged
What is most important in a project? What aspects of the project life cycle should be monitored? On what criteria to evaluate it? You will need to answer these questions beforehand.
Your new organizational strategy should help you write criteria to use in determining whether the project is a success or not. With this in place, you can refine and perfect the PPM process.
Step 3: Select a person to manage the projects
Now that you have the framework in place to start creating a prioritized list of projects, you’re going to need someone to manage it. It could be you, or it could be someone else in the organization. This person should be responsible for adjusting the priority list and monitoring project performance.
Step 4: Make adjustments
The work of the PPM project manager should generate data and information that you can use to make adjustments to future projects.
If a project is underperforming, you should perform an analysis to determine why, and either cut future similar projects or improve your processes. Likewise, take successful projects and see if you can apply the lessons learned to other projects and move similar projects up the priority list.
Step 5: Come together as an organization
Every now and then, perhaps every quarter or so, your organization should meet to reevaluate your PPM strategy. As you walk through some of these projects, you’ll see the impact they have on your organization and how they drive your strategy.
Perhaps many of the door-to-door fundraisers you’ve held for your charity have been flops, while a bake sale or two have been smash hits. The actual performance of the last few months should provide essential information to know if your strategy needs a major adjustment.
Meet with all key stakeholders to review the performance of your projects and determine if your organization is on the right track.
Should you use project management software for PPM?
Project management (PM) software can be useful if it has ways to track the results of a project in terms of expected versus actual results. These project management tools can help create a baseline for you to make decisions about future projects.
Look for software that can provide a work breakdown structure (WBS), which can help you break down projects and allow you to take a closer look at their parts.
It is also possible to simply use PM software and leverage project management skills to manage the projects themselves as part of a PPM strategy. This means you can use the software to create a project management plan for your PPM strategy, essentially treating all of these projects as one big project that you manage.
Use PPM to chart the way forward for your organization
It’s important to develop a long-term plan for your organization, and implementing PPM is a great opportunity to do so, as it forces you to think along those lines.
This strategy forces you to think deeply about what you and your colleagues or employees are trying to accomplish, and then you can figure out how you’re going to get there through the projects you choose to prioritize.
Set aside a few days in the next quarter to sit down with all of your organization’s key stakeholders to strategize how you prioritize projects in the future, and reap the rewards in the years to come. to come.