Project Portfolio Management: what itis and how to develop it

How to best manage the various projects in place within an organization? How to know which projects contribute to the business strategy so as to give them more priority, and which ones instead to eliminate because they are not necessary?

To answer the initial questions, Project Portfolio Management comes into play, a methodology that consists of managing multiple projects together to ensure the alignment of actions with company objectives, which must be respected in terms of time and budget. Projects are the basis of business strategies and the success of a company is closely linked to its ability to manage them effectively, because it means having an efficient and market-aligned business.

In a way based on global competition and where the survival of companies increasingly depends on their ability to propose a constant flow of successful new products, where products can also be services, the ability to manage projects is a factor of increasing importance. The aim of PPM is also to improve the success rate of new products, ensuring the implementation of a portfolio of projects strategically aligned with company objectives.

Whatis Project Portfolio Management

Project Portfolio Management consists of the practice of centrally managing a set of multiple projects, through an organized system that responds to certain characteristics. Unlike Project Management (which focuses on managing a single project), PPM serves for broader strategic management and is also concerned with selecting projects and assessing the organization’s abilities to execute them.

A key element of Project Portfolio Management is to define the project portfolio, that is, the set of projects based on the relevance and similarities necessary to achieve the company strategy and/or the set of programs (a set of projects independent of each other but with a common goal).

In this way, Project Portfolio Management gives executives, project managers, teams and all stakeholders a global view of ongoing or planned projects, including how they fit into the company’s directives and strategy.

In modern business ecosystems that are increasingly complex and require higher levels of performance, where success is measured in terms of projects completed, PPM is a new necessity for all companies that want to remain competitive.


The objectives of Project Portfolio Management

The main objective of Project Portfolio Management is to increase the value of the results obtained. In fact, managing projects in portfolios results in overall better results than separate management, because you get to benefit from greater synergy given by the alignment between programs and business strategy and optimal use of shared resources. Other specific objectives that the PPM aims to achieve concern:

  • Giving an overview to the team members: all the figures involved in the project can have an overview and see how the projects are linked to the company strategy and the broader objectives of the organization.
  • Achieve high productivity: the interconnection between the management of projects in portfolios and the achievement of company objectives allows to create greater involvement in employees, who are aware of the role they play and consequently are more attentive to the quality of results.
  • Better planning of resources and reducing waste: PPM allows you to allocate resources according to priorities and activities are scheduled in order to achieve objectives.
  • Making the company more agile: aligning activities with strategy, thus making it easier to adapt in the event of changes to seize new opportunities or overcome obstacles.
  • Increase return on investment (ROI): achievable as a consequence thanks to greater transparency on business objectives and better management of resources.


The phases of the Project Portfolio Manager

The key phases in which to articulate the Project Portfolio Management process include:

  • Identify projects, both existing and potential ones, so that you have a complete vision and can establish an optimal strategy. The collection of information on projects can be done starting from the data present within the organization or obtained directly from the project managers. This phase allows you to categorise and group projects according to common characteristics.
  • Determine how much each project impacts the company strategy. It is necessary to identify a priori the company’s strategic objectives so as to be able to determine the strategic activities for each project.
  • Define the priorities of each project, a task that it is up to the PMO to determine in what order the projects should be executed and with what motivation. In this alignment phase, decisions can also be made on which projects to delay or cancel and what-if analysts come into play to evaluate alternative portfolios.
  • Assigning resources: a fundamental step to manage the available resources avoiding waste and distributing workloads in a correct and balanced way.
  • Periodic reviews to ensure that the strategy is pursued even in the event of a change in needs. To facilitate this step, it is desirable to provide for the sharing of reports with executives, in order to give real-time visibility on the status of projects and facilitate the sharing of information.


The tools for Project Portfolio Management

So how do you manage a portfolio of projects? Project Portfolio Management is a complex practice that requires the control of numerous elements. In order not to lose sight of anything, digital tools are needed to define how to approach projects while staying in line with objectives and to manage resources committed to multiple projects at the same time.

It is therefore important that the chosen tool works in a multi-project perspective and that it brings together in one place all the relevant information on the projects, so as to be able to organize priorities and allocate resources, simplifying decision-making.

The essential features required most concern: intuitive dashboard to monitor activities and progress; simplicity in planning activities and monitoring them; collaborative environment for a faster exchange of information.


RSP: the Project Portfolio Manager Software

Efficiently managing the project portfolio is essential for a company that wants to be competitive. Using a system that facilitates management can greatly facilitate the work of project managers who have to manage teams committed to multiple projects.

CyberPlan RSP responds to this need and provides a tool capable of:

  • Schedule tasks supported by scheduling algorithms with user-defined rules to speed up decision making while reducing error, which is very useful in the most complex multi-project environments.
  • Simulate scenarios to facilitate decision-making in multi-project environments, with the possibility of evaluating the impact of negotiations and forecasts.
  • Ability to group resources according to skills and to have visibility on their interchangeability.

Learn how to manage a project portfolio and get the most out of your team.