1. Mgt Project Portfolio Management and the PMO Module 6 - Monitoring and Controlling the PPM Portfolio
Dr. Alan C. Maltz
Howe School of Technology Management
Stevens Institute of Technology
© Alan C. Maltz, Ph.D, 2014

2. This Week’s PPM
Focuses on Portfolio overview – review and monitoring of existing portfolio and introduces, discusses and analyzes the Stage-Gate Process versus standard portfolio reviews
© Alan C. Maltz, Ph.D, 2014

3. Portfolio management process (adapted PMI 2013)
Portfolio Management Processes
Monitoring and Controlling Process Group
Strategic Planning Process Output: Current Strategic Plan
Component Processes
Aligning Process Group
Component Execution and Reporting
Identification
Prioritization
Current Strategic Plan
Goals Definitions &
Categories
Key Performance
Criteria
Capacity Definition
Portfolio Balancing
Portfolio Reporting and Review ( )
Categorization
PPM links with
strategy
Evaluation
Authorization
Strategic Change No
PPM is a
continuous
business process
Selection
Yes
© Alan C. Maltz, Ph.D, 2014

4. Portfolio reporting and review
To gather performance indicators, provide reporting on them, and review the portfolio at an appropriate predetermined frequency, to ensure both alignment with the organizational strategy and effective resource utilization
To ensure that the portfolio contains only components that support achievement of the strategic goals
© Alan C. Maltz, Ph.D, 2014

5. Vision, Mission Strategic Plan
PPM and the Organization Context...
Vision, Mission Strategic Plan
Strategic Planning
Portfolio Performance Review
Strategic
Objectives
Identification, Categorization, Evaluation, Selection, Prioritization, Balance and Authorization of Portfolio Components
Portfolio Management
Operations
Project
Program
Requests
Project/Program Performance Review
Project/Program Mgt
Delivering Completed Project/Program to Operations
Project/Program Management Processes
© Alan C. Maltz, Ph.D, 2014

6. Goals of Effective PPM…
Maximizing portfolio value
Financial Models
Scoring Models
Balance in the portfolio
Risk vs reward
Use of bubble diagrams
Link to strategy
Top-down
Bottom-up
Hybrid
© Alan C. Maltz, Ph.D, 2014

7. Strategic changes Many companies use the Stage-Gate process
To enable the portfolio management process to respond to changes in strategy.
Many companies use the Stage-Gate process
to drive new products from idea to market
© Alan C. Maltz, Ph.D, 2014

8. Business Strategy & New Product Strategy
Integration between Gate and Portfolio Decisions ...
Business Strategy & New Product Strategy
Portfolio Review:
This meeting…
Reviews all the
projects together
Identifies
strategic
imperatives
Checks project
priorities
Checks for
portfolio balance
Stage-Gate Process:
All gates, projects…
Must pass Must
Meet criteria
Are scored on
Should Meet
criteria
Have Go/Kill
decisions made
Project status & Scores
Decisions & adjustments
Potential
conflict
Made periodically
Made in real-time
© Alan C. Maltz, Ph.D, 2014

9. Portfolio reviews Approach 1: Gates dominate
“make sound decisions at the gates and the portfolio will take care of itself”
Approach 2: Portfolio reviews dominate
“merely being in the portfolio does not guarantee funding”
© Alan C. Maltz, Ph.D, 2014

10. A Typical Stage-GateTM Process
Driving New Products to Market
Discovery
Idea Screen
Gate 1
Second Screen
Go To Development
Go To Testing
Go To Launch
Stage 1
Stage 2
Stage 3
Stage 4
Stage 5
Gate 2
Gate 3
Gate 4
Gate 5
Scoping
Build Business Case
Development
Testing & Validation
Launch
Post-Launch Review
© Alan C. Maltz, Ph.D, 2014

11. Go – is resourced; becomes Active Project
Gates dominate…
Go – is resourced; becomes Active Project
Pass/Kill
Project is evaluated against Must Meet & Should Meet Criteria
Does the Project Pass hurdles?
Pass
Prioritization:
How does the project compare to Active & On Hold projects. Resources are allocated.
Kill
Placed On Hold
© Alan C. Maltz, Ph.D, 2014

12. Gate dominate...
Focus on project management process— Real-time decision process
Each project is reviewed in-depth at the gates
Go/kill decisions are made
Project is prioritized— Ranking the project with other active and on hold projects
Resources are allocated
Impact of the project on the total portfolio is accessed— Balance and alignment
If the gating process is working well, the portfolio will take care of itself!
Still portfolio reviews are needed— senior management may meet once or twice a year to review the portfolio of all projects
© Alan C. Maltz, Ph.D, 2014

13. ? ? Portfolio Review Stage-Gate Process
Business Strategy & New Product Strategy
Strategic imperatives: Check for must do projects
Check List:
Project subjected to “Must Meet” criteria ?
Pass or Kill
Check for project priorities:
Prioritized scored list of active & on hold projects
Scoring Model
Project scored on “should Meet” rating criteria
Check for impact on portfolio
List of Projects: Active & On-Hold Project Scores from Gates
Check for strategic alignment & balance: bubble diagrams & charts ?
Go or Hold Priority set
Strategic imperatives (Must Do Now) Prioritization Adjustments
Projects are prioritized & resources allocated: -from other projects at/near gates – from other sources
Adjust the gating scheme
© Alan C. Maltz, Ph.D, 2014

14. Portfolio reviews dominate
Go/kill and prioritization decisions are made at the portfolio reviews— 3-4 times a year
All projects are up for consideration— projects compete against each others
Balance and strategic alignment are checked
Gates serve as checks on project status
© Alan C. Maltz, Ph.D, 2014

15. Portfolio Management intersecting with NPD…
Review –
Mass
Gate 2
All projects are
up for auction
Must Do’s identified
Won’t Do’s killed
The Rest are
force-ranked on
criteria & prioritized
Resources are
allocated
Business Strategy & New Product Strategy
Stage-Gate Process
Gate 1
Stage 1
Gate 2
Stage 2
Gate 3
Stage 3
Gate 4
Stage 4
Gate 5
Stage 5
Ideation
Preliminary Investigation
Detailed Investigation (Build Business Case)
Development
Testing & Validation
Full Production & Market Launch
© Alan C. Maltz, Ph.D, 2014

16. A Commercial System – Project Performance Management
Powersteering© by UPLAND
© Alan C. Maltz, Ph.D, 2014

17. A Commercial System – Project Performance Management
Powersteering© by UPLAND
© Alan C. Maltz, Ph.D, 2014

18. Class exercise Create a process for portfolio monitoring and control
What will be done? How often?
Describe tools and techniques, including their elements that will be used
Describe roles and responsibilities of individuals involved in the process
© Alan C. Maltz, Ph.D, 2014

19. Thank You - Questions?
Alan C. Maltz, Ph.D. Howe School of Technology Management Stevens Institute of Technology Castle Point on the Hudson Hoboken, NJ 07030
Phone: +1 (561)
Web:
© Alan C. Maltz, Ph.D, 2014