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Project Portfolio Management

The Advantages and Disadvantages of Project Portfolio Management

Published By Team Clarizen

The primary objective of project management is to assess a job and break it out into digestible tasks to accomplish a set goal. The ability to manage a project and see it through from conception to completion is generally a skillset that is learned through experience.

A successful PM has the ability to look at the bigger picture to organize and delegate accordingly. These are people that always have an end goal in mind and are the ones responsible for making sure it is reached in the timeframe promised. Therefore, at times, moving a business to portfolio management can be the wisest choice.

What is Project Portfolio Management?

To gauge the scope of a project, a project manager must set a time frame. In order to do so, it is sometimes necessary to view the business as a whole. This includes looking at every project on the table and prioritizing tasks within them. Projects can then be grouped into programs, which eventually form a portfolio.

Project portfolio management is often already performed during daily operations, it simply lacks the label. Any time a company aligns projects and programs with a common goal, it is practicing PPM. This process creates a hierarchal relationship of various elements that can be defined as:

  • Tasks form projects
  • Projects form programs
  • Programs form portfolios

The entire idea is to group projects and programs together in a portfolio in just the right way as to maximize the profit margin and increase overall ROI. Prior to taking the leap, it is wise to consider the pros and cons of active portfolio management before fully diving into the process.

Is Project Portfolio Management the Right Choice?

In order to understand if this PM solution is right for your company, it’s important to look at the advantages and disadvantages of project portfolio management as a whole.


There are an incredible amount of benefits to active project portfolio management. The following are just a few reasons to consider why it may be the right choice:


When there are a variety of programs going on, it is tough to pinpoint exactly what resources are available where. The entire process is fragmented. PPM allows a company to gain a common visibility of the bigger picture. Everyone knows exactly what they have to work with in the early stages of planning. Alignment spurs a company to speed up some projects and make choices based on strategic direction.


PPM allows for a greater depth of involvement across all verticals. Portfolios tend to gain the attention of senior management, and having them involved from the very beginning ensures a greater level of success across all projects. This type of alignment also makes performance issues entirely more visible and easier to address.


Whenever you open up a project to sharing resources in a portfolio, you lessen the risk of that project failing. Lumping multiple programs together and allocating resources allows a company to take on more work, while ensuring their current projects will reach success.


Although it seems like PPM is a no-brainer, when it comes to the benefits a company can reap, there are ways in which it can go drastically wrong or upset daily operations. The following are just a few ways in which PPM may not be right for your business:


Just as resources can be an advantage when program responsibility is shared, that can also be the downfall of project portfolio management. If the wrong person is assigned to allocating resources, there is a chance they could be misappropriated. It is critical that resources are distributed evenly and accordingly, in order for PPM to work.


Project management calls for the ability to define and categorize elements within a project in order to prioritize them. This is a much easier job when it is simply defining tasks within a project. Once the scope goes from programs to a portfolio, however, things become harder to sort.

If program prioritizations are not agreed upon because of the inability to properly define elements within the entire portfolio, this type of management may not work. In fact, it may just complicate things completely.


The size of a company may be the sheer factor that determines the success of portfolio project management. If a business is rather small or has minimal ongoing projects, it doesn’t seem necessary to waste the labor or cost organizing them. Especially if they are already at peak performance. PPM is only necessary when there is room for growth defined by a wider scope of management.

There are several advantages and disadvantages of project portfolio management so it’s importantFadvantage to understand if this is the right process for your organization before making a move. Portfolio project management encourages people to get involved from every level of the organization. It lessens risk and allows management to keep a closer eye on inventory across the board.

Increase your business agility with Clarizen’s project management software

PPM can also be a drain on resources and not the right fit for a company that is smaller in size. Overall, it’s about looking at the bigger picture and championing company values and goals. Portfolios can be the key to a disorganized setup, but you have to ensure the system works first.

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Written by Team Clarizen