Project portfolio management is all about taking a broader view of the projects undertaken by your organization. While there are natural similarities and overlaps with project management, the core objectives of project portfolio management are to improve how projects are executed across the whole organization rather than focusing on delivering one single project.
Project portfolio managers collect and analyze data that arises across the whole project portfolio, then use it to help keep projects aligned with the organization’s goals. PPMs may also assume many PM roles, such as vendor or risk management, to allow greater focus on specific tasks and deliverables.
Due to the significant advantages in terms of cost savings and oversight that PPM offices provide, project portfolio management has grown hugely in recent years. If you’re looking to implement it in your organization for the first time, here’s how to do it.
How to Implement Project Portfolio Management
Get executive buy-in
Implementing any structural change to an organization requires considerable executive support. Before introducing any plan for change, sound out stakeholders who you believe would be most receptive to the idea of project portfolio management. Even go so far as suggesting one becomes a project sponsor. This support at executive level will be essential, both for winning over the boardroom and for the expertise in organizational change that can be leaned on.
Create an effective strategy and implementation plan
Every successful implementation requires a plan. While introducing a project portfolio system won’t necessarily change how things are done at ground-level, it will introduce new functions and deliverables with regard to monitoring, reporting and sign-off. An effective implementation strategy will have ironed out all of these potential sticking points before kick-off.
Set project evaluation methodology
One of the core concepts of project portfolio management is that of evaluating the value each project holds for the organization’s overall strategic mission. To ensure consistency, fairness and the greatest returns for the organization, a project portfolio evaluation methodology needs to be created that can effectively assess the costs, time and resources each project requires versus their expected returns. This can be tweaked at set periods if great discrepancies between projections and outcomes are discovered, but it must be applied consistently.
Outline the project portfolio
The first role of a project portfolio manager will be to actually decide on the project portfolio. This will involve using the evaluation methodology to assess the feasibility of the suggested projects, afterwards delivering a final list for executive sign-off. This list may or may not have alternative options, depending on the ultimate status of the manager.
Define the new roles
As mentioned before, the main role changes to occur under project portfolio management will be at the management level. This can cause some issues with project managers pushing back against what could be perceived as an extra layer of hierarchy above them, requiring the relinquishing of certain PM roles. A meeting of all PMs should be called to alleviate concerns and to set out how roles will be defined going forward.
Be open to iteration and change
No change or implementation will go exactly as planned, since it’s impossible to predict everything. However, especially for agile businesses, planning ahead and setting periods for implementation reviews and possible reiterations gives the organization the flexibility to pivot away from risk or to adapt certain processes if they are not found to be functioning as intended.
Project portfolio management has become hugely popular with organizations across all fields, a fact which has been greatly aided by advancements in PPM technology. Software such as Planview AdaptiveWork’s project management tools allow organizations greater oversight and information about how all projects in the organization are performing, enabling more effective project portfolio management.
