The Beginner’s Guide To Project Portfolio Management

Business projects often involve many moving parts that companies must track to ensure success. This calls for project portfolio management (PPM), which, if done correctly, will increase the efficiency and productivity of all the projects in an organization. Project portfolio management is the process of identifying, prioritizing, coordinating, and monitoring projects in an organization to ensure they align with the company’s strategy and objectives.

This differs from project management because that focuses on the success of a single project. Instead, project portfolio management focuses on a company’s entire project portfolio and considers the big picture.

The process involves a handful of key decision-makers who analyze project proposals to determine if they advance the company’s long-term goals. Those that fail this test will be rejected, and the project portfolio management team will determine how all the approved projects are interconnected. The relationship between these projects will determine how they will be prioritized and how much resources the company will allocate to them.

Once the projects are in motion, the PPM team has to constantly monitor them because delays in one project can affect others in the portfolio. In some companies, PPM teams use software to track project performance so they can intervene when necessary. One of such project portfolio management software is PMO 365 because you can seamlessly integrate it with the Microsoft 365 cloud. Most businesses already use Microsoft 365, so adapting to this tool will be relatively easy compared to others.

The Significance of Project Portfolio Management

Companies use project portfolio management to link their long-term objectives with the projects it takes to get them there. It ensures they stay on the right track and do everything necessary to produce the desired outcome. It also helps them carry out these projects efficiently and cost-effectively.

Centralizing projects promotes consistency, encourages teamwork and collaboration, and enhances communication between employees at all levels. It also lets business leaders monitor their employees to verify they use the proper methodologies to carry out their projects. Businesses that engage in PPM have a competitive advantage because they are more likely to use their resources wisely to achieve their goals in the shortest time possible.

How Project Portfolio Management Works

Here are the steps involved in the PPM process:

1. Planning the portfolio

This includes assessing project proposals, conducting market research, and meeting with consultants to determine the best long-term strategy for the company.

2. Selecting and prioritizing the projects

The PPM team will rank every accepted project in order of priority to determine how best to allocate resources to them.

3. Determining how feasible the portfolio is

The team will work directly with the employees involved in the projects to assess each project’s risks and limitations.

4. Resource allocation

Every selected project will be allocated resources so they can begin and be completed on schedule.

5. Monitoring and managing the process

The PPM team will work closely with the project managers to observe their progress and address obstacles when necessary.

6. Collate reports

The team will regularly collate reports about performance, personnel, risks encountered, and resource utilization from all projects and present them to the portfolio stakeholders for review.

Endnote

Project portfolio management helps companies determine their long-term strategy and goals and weigh them against the available resources, employees, infrastructure, capabilities, and other elements that influence a project’s potential for success. These will guide the PPM team’s decision-making through the project portfolio management process. Software tools like pmo365 are invaluable to this process because they help the PPM team gather and visualize the data produced.