Project and Portfolio Management (PPM) is a discipline that includes processes, technologies, methods, and tools to align programs and projects with an organization’s strategy and to maximize the value and benefits related to projects and programs. This article reviews the objectives behind the implementation of a PPM initiative in an organization.
PPM is about two things – (1) Selecting the “right” projects that are aligned to the objectives and goals of the organization and (2) doing those projects “right” in the sense that the organization gets its ROI.
Selecting the “right” projects means the following:
- A proper project intake process that ensures inclusion of all types of projects that are required to be evaluated.
- Preparing a proper business case for each of the projects and initiatives before they can be evaluated for potential selection.
- Ensuring the existence of a capacity management framework where resource allocation is visible and managed. This helps toward resource allocation decisions and prioritization of projects.
- Project selection is one activity where the organization ensures that selected projects are aligned with an organization’s goals and objectives. However, to ensure successful alignment in the later phases of the project, a project is continuously scrutinized for its viability to ensure that it’s still useful for the organization. This ongoing evaluation can be done during stage gate reviews or through other similar controlled processes.
- Instituting the right governance processes to do the above.
Doing projects “right” means the following:
- Mature PM practices are in place that ensure projects are delivered within their constraints of quality, cost, and schedule.
- The PMO is able to handle the delivery all types of projects adequately including Mode 1 and Mode 2 types of projects.
Depending on the organization size, and the PPM and PM maturity of an organization, a PPM initiative can take months and even years to fully implement before an organization can start to reap the fruits of its efforts. Before embarking on a PPM it’s therefore quite vital that an organization evaluate its goals and objectives and chart out an appropriate implementation roadmap. Some of the objectives behind a PPM approach can be the following:
- Strategy Execution – A good strategy without an effective execution framework is of little use. As projects and programs are the vehicles that an organization uses to execute its strategy, a PPM process provides that overall framework for execution that addresses alignment of projects and benefits realization. A PPM process provides an overall framework to measure the value of strategy.
- Project Alignment with Business Objectives – This can serve multiple purposes the primary of which is that with numerous requests for projects and initiatives in an organization, a PPM process ensures that projects are evaluated in the context of an organization’s overall goals and objectives before the right projects are selected for delivery. Achieving this requires streamlining of all the functions from project intake to project selection and funding. The PPM process therefore links strategic imperatives and priorities to the capital allocation process.
- Looking to increase the ROI of the Portfolio and Projects – For some organizations, a PPM initiative becomes important because of their need to effectively measure the ROI of their funded projects and initiatives. As projects are grouped into various portfolios (e.g. IT infrastructure projects, new development projects, maintenance projects, and so on), an organization wants to get more visibility into their performance as they fund those initiatives and monitor those initiatives.
- Demand and Resource management – After an organization evaluates and selects its projects, it should then prioritize the projects to ensure assignment of available resources. This is because it’s possible to have more projects that have passed the evaluation and selection criteria than available resources to work on them.
- End to end visibility of projects from intake to delivery – A PPM process provides a holistic view of all the projects within an organization. This ensures getting complete control of the process. This enables better decision making throughout the PPM process. Decisions taken include project selection, resource assignment, and so on.
These are some of the objectives of a PPM approach. An organization may have different motivations to implement such an initiative. It is therefore important to be clear on the objectives and the expected ROI before proceeding with the overall implementation of the initiative.
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