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Project Portfolio Management

What is Top Down PPM and Why is it Important?

Published By Innotas Team
What is Top Down PPM and Why is it Important?

What is Top Down Portfolio Management?

Top down portfolio management is an approach to implementing project portfolio management software that helps to minimize organizational change and promote solution adoption.  Opposed to the bottom up approach to PPM which focuses on improving individual project execution through detailed task management, top down portfolio management focuses on improving the portfolio planning process and improving project execution and value via better planning.

For organizations that are newer to portfolio management, top down is often the recommended approach to PPM by leading industry analysts.

Three Reasons Why a Top Down approach to Portfolio Management Promotes a Successful PPM Implementation

1. Ensures Better Project Alignment

[pullquote]Top down portfolio management emphasizes defining a systematic process for how projects get prioritized and selected.[/pullquote]

Top down portfolio management emphasizes defining a systematic process for how projects get prioritized and selected.  Improving the project review and selection process helps guarantee that your organization stays focused on the highest value initiatives and improves the value delivered by the project portfolio as a whole.  Putting a process like this in place helps minimize one off work requests and ensures that organizational resources stay focused on the right areas, in turn improving project delivery.

2. Minimizes Organizational Change

The top down approach to PPM minimizes organizational change by focusing initially on just capturing project KPIs that are critical metrics for reporting and planning.  Often organizations implementing a top down portfolio approach will not capture any task level information and just track high level project KPIs (tracking milestone or phase level task information is also common).  Tracking project information at a high level ensures that project resources can spend their time actually doing project work and spending all of their time keeping the PPM tool updated!

3. Better Planning leads to Better Execution

Better planning leads to better execution, and one of the biggest reasons that projects fail is that those projects were poorly planned and scheduled without consideration of the broader portfolio.  Resource capacity and demand constraints are often the biggest impediment to completing project work on time and on budget and often PMOs struggle to get visibility into how resources are allocated across project and non-project work.   The traditional, bottom-up approach to resource management, which emphasizes scheduling individual resources on tasks, can be very time consuming and often provides an unnecessary level of detail, especially when projects are in a pre-execution stage.  A top down approach to resource management focuses on assigning resources at the project level for a percentage of that resources time, and is a much more efficient way for project and portfolio managers to perform resource planning, especially those that are new to PPM.  Adopting a top down approach to resource management is an excellent way for newer organizations to improve visibility into resource capacity and demand, without requiring an excessive amount of effort for data input.  Creating a high level resource capacity and demand view can dramatically improve portfolio planning thus facilitating project scheduling, simplifying headcount forecasting, and improving overall project execution.

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Written by Innotas Team