THE ROLE OF PROJECT PORTFOLIO MANAGEMENT IN INCREASING THE EFFECTIVENESS OF A PROJECT PORTFOLIO Introduction
The issue of whether project managers should adopt project portfolio management in the management of multiple projects or not has raised a lot of debates in organizations. It is evident that project managers find it difficult to manage multiple projects on their own without the help of project portfolio management which provides the capacity needed to effectively handle multiple projects. Some company executives insist that portfolio managers are not necessary and yet this not the case. Companies initiate multiple projects each and every day with high performance standards. Project managers do not have the capacity to coordinate and control multiple projects in a project portfolio without the help of project portfolio management (Mahajan 2009, p. 78). Project portfolio management is a new concept in project management that is yet to fully explored and utilized by many organizations. The effectiveness of a project portfolio can not be achieved without the expertise of a portfolio manager. The effectiveness of a project portfolio is very vital when an organization wants to meet its organizational and financial goals (Mahajan 2009, p. 134). Some project managers feel that their job is threatened with the introduction of project portfolio management. This is not the case because project portfolio management is only meant to complement the work of a project manager. This position paper will discuss why it is necessary for an organization to adopt project portfolio management when handling multiple projects. Project portfolio management plays a critical role in increasing the efficiency of a project portfolio. Background Information
It is important to first of all have some background information about project portfolio management before discussing why it is necessary in increasing the effectiveness of a project portfolio (Levin 2010, p. 93). Project portfolio management introduces a new system in portfolio management where all the technologies, methods and processes used in the management of multiple projects are centralized in one place. Each project in a project portfolio has unique characteristics that are analyzed and collectively managed by the project portfolio management office. Effective allocation and tracking of resources meant for multiple projects is not an easy task but this can be done by a portfolio manager who has the capability and tools to come up with an effective framework for managing multiple resources (Brunel 2006, p. 28). Project portfolio management is very essential in project-driven organizations and this is attributed to the fact that inter-related tasks need to be managed in a centralized manner. Project execution and decision making are the segments of project management that require the capabilities provided by project portfolio management. Project portfolio management provides project managers with the required capabilities necessary to handle multiple projects. Project portfolio management offers simple and cheap strategies that are needed in the execution of multiple projects. Some of the most important capabilities brought about by project portfolio management include pipeline management, resource management, change control, financial management and finally risk management (Brunel 2006, p. 59). The capabilities brought by project portfolio management are very critical in increasing the efficiency of a project portfolio (Rad 2006, p. 49). The work of project managers becomes simple with the adoption of project portfolio management. Project portfolio management provides the best platform for project managers to carry out their duties with minimum risks (Rad 2006, p. 49). The importance of project portfolio management can only be understood in this...