Project Portfolio Management
Abstract
This paper seeks to explain the Project Portfolio Management (PPM), the reasoning behind it as a set of processes and methodologies and how these build a group of singular projects into a stack or tier that can be holistically graded, how these processes can drive IT to become closely modelled on and aligned with business strategy. It seeks to point out successful methodologies for PPM implementation and some of the issues that can arise.
The basis of PPM
Project management and by extension portfolio management are curious disciplines. They attempt to present simple methodologies for guiding an activity (or group thereof) through all its stages from inception to completion, within defined cost and time boundaries. Many of the facets of project portfolio management appear to be simply common sense, but there are many more projects that fail because misapplication of these principles.
Portfolio management is the process of applying a standardised set of management tools and methodologies against a basket of projects, in order to ascertain amongst other things:
* Which projects are performing as expected relating to resources consumed * Which projects will deliver the expected benefits to the organisation * Which projects have fallen out of scope of the business strategy due to external factors
With the overall goals of: * Maximising return on investment * Lowering total cost of ownership through the entire project life cycle (and in particular reduce significant “tail” spending at the mature stage of a project) * Produce fit for purpose systems through constant & consistent rebalancing of inputs (costs & goals) versus outputs (systems) * Aligning IT implementation closely to IT strategy and by extension to the broader business strategy.
According to James Pennypacker and San Retna of the Enterprise Portfolio Management Council the aims of portfolio management can be illustrated by five key questions:
This paper seeks to explain the Project Portfolio Management (PPM), the reasoning behind it as a set of processes and methodologies and how these build a group of singular projects into a stack or tier that can be holistically graded, how these processes can drive IT to become closely modelled on and aligned with business strategy. It seeks to point out successful methodologies for PPM implementation and some of the issues that can arise.
The basis of PPM
Project management and by extension portfolio management are curious disciplines. They attempt to present simple methodologies for guiding an activity (or group thereof) through all its stages from inception to completion, within defined cost and time boundaries. Many of the facets of project portfolio management appear to be simply common sense, but there are many more projects that fail because misapplication of these principles.
Portfolio management is the process of applying a standardised set of management tools and methodologies against a basket of projects, in order to ascertain amongst other things:
* Which projects are performing as expected relating to resources consumed * Which projects will deliver the expected benefits to the organisation * Which projects have fallen out of scope of the business strategy due to external factors
With the overall goals of: * Maximising return on investment * Lowering total cost of ownership through the entire project life cycle (and in particular reduce significant “tail” spending at the mature stage of a project) * Produce fit for purpose systems through constant & consistent rebalancing of inputs (costs & goals) versus outputs (systems) * Aligning IT implementation closely to IT strategy and by extension to the broader business strategy.
According to James Pennypacker and San Retna of the Enterprise Portfolio Management Council the aims of portfolio management can be illustrated by five key questions: