PPM is crucial for a project to be successful as well as to identify any back lags if it were to occur. Project Managers often face a difficult situation arising from lack of planning and sometimes this may lead to a project withdrawal.

It's the primary responsibility of project managers to ensure that there are enough available resources for the projects that an organization undertakes. Proper resources will ensure that the project is completed within the set timeline and delivered without a compromise on quality.

Project managers also may wish to work on projects, which are given its utmost priority and value to an organization. This will enable project managers to deliver and receive support for quality projects that they have undertaken. PPM ensures that these objectives of the project management will be met.

The Five Question Model

Five Question Model

The five question model of project portfolio management illustrates that the project manager is required to answer five essential questions before the inception as well as during the project execution.

Project Portfolio Management

When implemented correctly, project portfolio management (PPM) transforms organizational approaches to project management and business growth. PPM ensures organizations execute the right projects at the right time in a consistent way to deliver maximum business value. Like any major change within an organization, introducing PPM practices and processes requires a roadmap to success. Read on for a 9-step PPM implementation plan.

Step 1: Set the Strategy

Aligning projects to business strategy is core to project portfolio management so it makes sense to start with a clear understanding of that strategy. What does your business want to achieve and when? What solutions or internal transformations are needed to reach these goals? Speak with senior stakeholders and executives about their definition of value and expectations from current projects. Understanding this big picture will help you win executive support for PPM in Step 2 and develop a ranking system for projects in Step 4.

Step 2: Win Executive Support

Introducing PPM requires a shift in mindset and processes that some individuals will resist. To reduce this friction, you need to identify key stakeholders and share your vision for PPM to win their support early on. Support should start from the top of your organization and spread through every department. Remember – PPM will ultimately inform how every team conducts projects so take time to work with the right people from the outset.

As with any change, individuals are going to have questions! Here are a few to expect:

What is project portfolio management and why do we need it?

How will the organization benefit?

Will PPM support strategy execution?

What is the short, medium, and long-term vision for PPM?

Will there be any impact on current or upcoming projects?

Will there be one or several portfolios?

How will PPM integrate with current processes?

Will we need to recruit or re-deploy resources?

Do we need to invest in any new systems or software?

Step 3: Build the Implementation Team Now that you have aligned your vision for PPM with organizational strategy and secured executive support, you can develop an implementation team. The team should include technical team members to help with project evaluations and new systems, portfolio managers, and other key stakeholders. You may also need to establish a steering committee or governing body consisting of senior management and directors to help with key decisions.

Step 4: Collect Project Data

Assessing the status of ongoing projects and the project pipeline against the organization’s strategy is an important milestone in your PPM journey. Collecting this data will allow the team to answer essential question such as:

Number of current project

Number of upcoming projects

Number of projects aligned to one strategic goal

Overall cost of all projects

Projected return on investment (ROI) of all projects

Estimated v actual schedules.

Gathering project data also provides an opportunity to review processes throughout the organization, for example, is the same naming convention applied to all projects? Does every project have the same documentation? Do project teams conduct and record a post-mortem when the project is finished? You will likely find project management approaches vary by department or team, which makes comparing and ranking projects a little tricky!

There are a few areas in which you need to collect data. These include:

Project data: Name; project manager; project sponsor; charter or description; schedule and milestones; risk level; resource allocation; projected ROI, and reporting schedule and tools.

Organizational data: Available resources and skills, and current and upcoming resource assignments.

It is also recommended to categorize projects by status to understand their strategic value and contribution to the organization.

Categorization could look like:

Proposed projects

Approved projects (may be funded but not active)

‘Grow the Business’ projects

‘Maintain the Business’ projects

Completed projects

Cancelled projects.

How you collect and collate this data will depend on available systems. If your organization is using a collaborative project tool, this process will be easier. If not, start with a simple Excel spreadsheet.

Step 5: Evaluate Your Projects

Having gathered all relevant project data in one place, it’s time to evaluate the current project portfolio. Depending on your approach, you may wish to develop a ranking or scoring system to ensure the evaluation is objective and consistent. Learnings from this step will affect the creation of a new portfolio later on.

Review the portfolio and look for any obvious issues, such as duplicate projects, interdependencies between projects, high-risk projects, and over-allocated resources.

Next, probe deeper to assess how many projects align to strategic goals and the likelihood of completing these projects. Also, think about what you can realistically achieve with available resources.

Step 6: Create Your Portfolio

Armed with your evaluation data, create a new portfolio by changing the status and priority of the projects, for example, stop any duplicate projects and start relevant on-hold projects. The goal is to create a well-rounded portfolio that meets internal requirements and delivers a healthy ‘risk-reward’ mix.

At this stage, you should define and document key processes, such as project request management and PPM reporting structures. Depending on existing tools, the organization may need to upgrade or purchase a project management software tool such as BrightWork to support the new approach.

Step 7: Test and Refine

project team charter

Before introducing the new portfolio and process to the whole organization, test your assessment with a few stakeholders and use their feedback to refine as needed. You may also need to create a user group to trial any new software or processes, for example, project request procedures.

Step 8: PPM Roll-out

Working with senior management, develop a roll-out program. It is advisable to start with one department and evolve with more departments or teams later on. Depending on the scale and scope of projects, you should consider using a change management plan to help overcome any obstacles or resistance to new approaches. Set realistic expectations with end-users and maintain regular communication so you can quickly address any unexpected issues.

Step 9: Learn and Adapt

At BrightWork, we advocate the ‘Start-Evolve’ approach to project management; START by focusing on your immediate needs, and EVOLVE with experience. The same approach also works for project portfolio management.

Using agreed reporting schedules, metrics, and periodic reviews, assess your portfolio from strategic (overall portfolio results) and tactical (health and performance of individual projects) perspectives every few months. Look for short, medium, long-term opportunities to refine your PPM strategy.

This agile approach ensures the portfolio remains aligned to strategic goals and provides an opportunity to gather feedback from key stakeholders at regular intervals. For more tips and ideas on evolving your PPM approach, check out our recorded webinar, 3 Best Practices for Implementing Project Portfolio Management on SharePoint.