The Project Portfolio Management market is disruptive. Increased reliance on PPM creates value for the business by providing clarity and visibility into resources, projects, timelines, budgets, and more. Organizations are dependent on the PMO to cement the business’ competitive advantage through strategic portfolio prioritization and planning as well as efficient execution that is responsive to change. To cope with this intense and disruptive period of change requires a laser-sharp strategic focus. It demands innovative and proactive methods to ensure information is accurate and up to date. A strategy-first approach to project portfolio management improves business agility, ensures traditional and agile projects are tied to business-outcomes, and empowers teams to realize business strategy and drive results. PPM supports strategic business through:
1. Resource Capacity and Demand Planning
2. Strategic Project Selection and Prioritization
3. Benefits Tracking and Milestone Management
4. Predictive Analysis and Forecasting
5. Custom Dashboards and Reporting
6. Centralized Portfolio Management with System Integration
7. Change Management Protocols for Effective Change Rollouts
8. Re-Prioritized Portfolio and Scenario Modeling
Acronyms Defined: The difference between project management and portfolio management
Many organizations start their PPM journey at the beginning – with basic tools and minimal complexity. This can get them pretty far and many can support complexity that will suffice for many project managers throughout their career. However, to save time and money, often times a formal project management tool helps with efficiency and visibility at the top. This might evolve from a simple task management tool to a formal project management solution designed to help with the end-to-end management of a project inclusive of financials, dependencies and milestones. For a bit more sophistication, a solution that also handles resource management and utilization is very beneficial.
As teams progress up the maturity scale of portfolio management, the benefits become increasingly clear: managing projects and resources in a single system, portfolio level management and analysis, strategic resource management and capacity planning. For teams looking to take a more strategic approach to project portfolio management, it is necessary to have a solution that can provide the data and information required to implement that strategy. To clarify the difference and hopefully provide some boundaries to each of these unique disciplines, this quick guide will outline where each of these levels of project management.
1. Collaborative Work Management: Getting work done
2. Project Management: Doing the work right
3. Project Portfolio Management: Doing the right work
4. Project Management Office: Tying it all together
Collaborative Work Management (CWM)
Collaborative work management is the term often used for ‘unstructured’ activities or ‘day-today’ tasks that come up and help to have organized. Simple to-do lists, status checks, sharing of tasks, assignments or basic collaboration are all common elements of work management and help teams to become more efficient. CWM provides a visual way to understand what has been assigned and an easy way to get updates. Where common CWM ends is often in the planning as tasks often aren’t related to one another or sequential, they are not usually weighted to understand effort or difficulty, and while importance might be noted it is often subjective.
Project Management (PM)
Project management is a broad term but is a significant leap above CWM in that there is a prescriptive and proven method for how projects are planned and executed, defined goals of the project and activities within the project, much more emphasis on planning and approval as there is always budget and resources associated with projects (even if it is just 1 person). Projects have a defined start and end date (usually), a defined budget (again, usually) and a goal (even if that is just to end on-time and on-budget). Project management accounts for more nuances of projects such as dependencies, approvals when certain tasks are completed, issue and risk management for when things come up, and a strong emphasis on end reporting (ideally) to ensure the project met the original intent.
Project Portfolio Management (PPM)
Project Portfolio Management is a practice that builds on project management but differs significantly in that it manages multiple projects across a portfolio. Within PPM there are hierarchies as projects are aligned with programs or other similar projects, resource management becomes a much larger factor as the same pool of resources can be shared among multiple projects within the portfolio, and the biggest difference from PM to PPM is the level of strategy. PPM is successful when portfolios are aligned with a specific business goal and projects within that portfolio are geared to execute toward that goal with specific metrics and benchmarks. PPM ensures balance within the organization between maintenance or operational projects and innovative or transformative initiatives. PPM empowers the organization to achieve business results and drive progress. Reporting and analytics become extremely important in PPM focused organizations because there are much higher stakes; small efficiency gains yield large returns and investments are strategic rather than robotic.
Project Management Office (PMO)
The project management office is the centralized team for all projects and requests from the organization. The PMO leads the execution of projects and programs, managing toward a portfolio and strategic business goals. Many PMOs are responsible for organization change management and transformative initiatives. The PMO often works cross-functionally to support all departments and works to deliver tangible business benefits.
Project Portfolio Management in Practice and in Context
While these related areas coexist and support one another, there are very distinct benefits to each and it is important to understand which function is being referenced. Explore some of the PPM Chanllenges and Opportunities faced by PPM Leaders, PMO Leaders and Project Managers in the next article.
Mastering Project Portfolio Management
Laying the right foundation for project portfolio management requires a few things and these industry experts are sharing their thoughts!Master Project Portfolio Management
Mastering Strategic Portfolio Management
Today’s most influential industry experts share their secrets to mastering strategic portfolio management.Master Strategic Portfolio Management
Mastering Organizational Agility
Today’s industry experts understand that organizational agility is important to keeping up with today’s demands and are sharing their secrets to success.Master Organizational Agility
Mastering Agile Portfolio Management
With ever-changing demands, it’s important for the PMO to be able to adapt. Hear how industry experts say PMO leaders should be approaching Agile portfolio management.Master Agile Portfolio Management