According to research by PM Solutions, 71% of companies have a project portfolio management system. PPM’s growth is evident in the rising number of companies adopting project portfolio management solutions. Show However, what kind of companies can benefit from PPM? Project portfolio management is a must-have for any company that has several projects going on simultaneously, such as: IT Information technology teams are typically smaller with highly specialized talent and bigger budgets. Resource profiling can be done to update skills inventory and appropriately meet peak demand periods. Use data-driven forecasting to assign the team to value-creating projects. Meet project demands successfully without under or over-burdening the team. Construction Often, companies lose focus on their overall goals in the chaos of managing more minor details. For example, large construction projects can take months and even years to complete. Many things may change during that time. Decreasing project finances, ever-changing stakeholder needs, or the exit of key project personnel can quickly change project dynamics. However, project portfolio management helps keep the focus on the big picture and supports the construction team to keep moving toward its goals. Financial services Accuracy is the bedrock of financial services companies such as credit unions, banks, and credit card firms that process payments and manage money. Employing portfolio project management solutions helps companies set up performance thresholds, adapt to changing trends, and gather real-time metrics to meet project objectives. Project management teams According to Wellingtone’s State of Project Management report, only 29% of companies complete projects on time. Using project portfolio solutions can be an effective method for minimizing unforeseen delays, mitigating risks, and sequencing projects for maximum success. As a result, stakeholders get more visibility into project prioritization and can understand project value better. Professional services teams Professional services teams have different needs based on their size. Smaller companies tend to have fewer projects with smaller budgets, while the larger companies have multiple projects running simultaneously. With a standardized system of workflows and realistic budget estimates, teams can complete their projects faster while minimizing project risks. Marketing teams Marketing teams have multiple projects with greatly varying needs. For example, one project may focus on tapping into a new region, while another may be involved in gaining market share in an online marketplace. Marketing teams need to prioritize initiatives that move the overall business goals forward instead of an individual project.
As the saying goes, there is always room for improvement, and organizations are constantly looking for ways to improve processes and optimize resource utilization. If an organization is big and juggling many projects at the same time, it is difficult for them to better utilize their resources if all projects are performed in isolation. So, they manage projects in groups to use the resources efficiently. Now, if an organization has more than one project, they will deal with them under a program or portfolio. The distribution of projects under a program or portfolio depends on the nature and the type of project. Programs are managed through program management and portfolios are managed through portfolio management. To manage a project under any of the above, it is necessary to understand the concepts well. Therefore, in this blog post, I will discuss projects, programs, portfolios, and their management. Collectively, these terms are known as the 3Ps of project management. ProjectA project is the lowest level in the hierarchy of project, program, and portfolio. According to the PMBOK Guide, “A project is a temporary endeavor undertaken to create a unique product, service or result.” So, you can say that the nature of a project is temporary; once the project achieves its objective, it no longer exists, and the objective of the project is to create a unique product or develop a system to provide you with a service or the result. For example, assume you have been given a project to set up a call center for a company. You complete the project, set up the call center, and hand it over to your client. Now your client can provide a support service to their customers. Please note that once you hand over the product to the client, your project will be completed and closed. You will disband your team; members will be separated since the nature of the project is temporary. It is not necessary for your team members to be located in the same place; sometimes your project team may include members located outside your geographic location. In this case, you will call your team a virtual team. As a project manager, you will be responsible for managing projects, and the project success criteria are timely completion, under budget, and conformance to the requirements. Project ManagementProject management is about managing projects, and it helps projects achieve their objectives. The processes include initiating the project, developing a plan, executing the project, controlling the project activities throughout its lifetime, and finally handing over the output of the project to the client, and closing the project. Project management is the application of knowledge, skills, tools, and techniques to meet project requirements. ProgramA program is a group of related or similar projects managed in a coordinated way to get the benefits and control not available from managing them individually. This means that in a program, you will have multiple projects, which are either similar or related to each other, and you manage them at a higher level. For example, assume you have two projects: the first is to construct a school building and the second project is to construct an office building. Since these two projects are similar, you will keep them under a program. The person responsible for managing the program is the program manager. The program success criteria for a program is the degree to which it satisfies its objective. Program ManagementPrograms are managed under program management, which is defined as the centralized, coordinated management of a program to achieve its strategic objectives. You only manage the interrelated or similar projects as a group to accomplish the desired result. The objective of program management is to optimize the resource utilization among projects and reduce friction to increase the organization’s performance. The Difference Between Project Management and Program ManagementThe following are a few differences between project management and program management:
The Benefits of Program ManagementA few benefits of program management include:
PortfolioA portfolio refers to a group of related or unrelated projects or programs. A portfolio can consist of multiple programs or multiple projects. It can have multiple, dissimilar projects because portfolio management deals with two or more unrelated projects. Conversely, in program management, only related projects are managed. For example, assume you have three projects: the first is to construct a building, the second project is to conduct research on the impact of motor pollution on the environment, and the third project is to set up a call center. How are you going to manage these projects? You will manage them by keeping them under a portfolio because they are neither related nor similar to each other. The portfolio manager manages portfolios. The success criteria for a portfolio is the combined performance of its components. Portfolio ManagementPortfolios are managed under portfolio management. It has a bigger scope and objective than program management. There is centralized management in portfolio management, an individual’s job is to identify, prioritize, and authorize the projects or programs. This centralized management manages the projects or programs to achieve the organization’s strategic objectives. Portfolio managers set the priorities of projects based on the leadership’s agreed-upon business objectives. They select the program or projects under a particular portfolio and make sure that they provide the most benefit to the organization. Please note that although portfolio management sets the priority of the projects or programs in a group, it does not oversee any individual project or program. The Difference Between Portfolio Management and Program ManagementThere are a few differences between portfolio management and program management, including:
The Benefits of Portfolio ManagementSome benefits of portfolio management include:
SummaryAs you move from project management to portfolio management, the scope and objectives will become larger and larger. In project management, you perform micro-management, and in portfolio management, high-level macro-management is required. Program management and portfolio management facilitate better communication and coordination among projects and programs, resulting in enormous benefits to economies of scale and fewer risks. These are essential topics from a PMP exam point of view, and you are going to see some questions on these topics on your exam. Make sure you understand these topics well. How are you involved with a project, program, or portfolio? Please share your thoughts in the comments section. |
Portfolios deal with all of an organization’s projects, while programs deal with:
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