1. Prof. Roy Levow Session 12

2.  Introduction to Project Portfolio Management  Establishing a Portfolio Strategy  Evaluating Project Alignment to the Portfolio Strategy  Prioritizing Projects and Holding Pending Funding Authorization  Selecting a Balanced Portfolio Using the Prioritized Projects

3.  Managing the Active Projects  Closing Projects in the Portfolio  Preparing Your Submission to the Portfolio Management Process

4.  Understand current practices in corporate project portfolio management and how they are applied  Know how to deliver explicit business value through a strategically aligned project portfolio  Adapt the concepts and practices of project portfolio management Copyright 2007 John Wiley & Sons, Inc.Chapter 204

5.  “A collection of projects that share some common link to one another.”  Examples of links  Same business unit or functional area  New product development  Same budget or resource pool Copyright 2007 John Wiley & Sons, Inc.Chapter 205

6.  Establishing the investment strategy of the portfolio  Determining what types of projects can be incorporated in the portfolio  Evaluating and prioritizing proposed projects  Constructing a balanced portfolio that will achieve the investment objectives  Monitoring the performance of the portfolio  Adjusting the contents of the portfolio in order to achieve the desired results Copyright 2007 John Wiley & Sons, Inc.Chapter 206

7. Copyright 2007 John Wiley & Sons, Inc.Chapter 207

8.  Proposed  Aligned  Prioritized  Selected Copyright 2007 John Wiley & Sons, Inc.Chapter 208 Active Postponed Canceled Completed

9.  Strategic Alignment Model: Aligns projects with the strategic goals of the organization  Boston Consulting Group Products/Services Matrix: Four categories of products based on growth rate and competitive position  Cash Cows  Dogs  Stars  ?  Project Distribution Matrix  Classifies projects by New, Enhancement, or Maintenance  Growth versus Survival Model: Projects to do better versus must-do projects  Project Investment Categories:  Infrastructure  Maintenance  New Products  Research Copyright 2007 John Wiley & Sons, Inc.Chapter 209

10.  “Will projects be partially funded in order to include more projects in the portfolio, or will projects be funded only at the level of their request?”  “If an investment category has excess resources after project funding decisions have been made, can those resources be reallocated to other investment categories without compromising the portfolio strategy, and if so, how will they be reallocated?” Copyright 2007 John Wiley & Sons, Inc.Chapter 2010

11.  Is the project in alignment with the portfolio strategy?  Proposer does the evaluation  Intake person does the evaluation  Then project is placed in a bucket (either money or resources)  Best to use an objective, consistent criteria Copyright 2007 John Wiley & Sons, Inc.Chapter 2011

12.  Many methods ranging from the very simple to complex mathematical models  Six Example Models  Forced Rankings  Q-Sort  Must-Haves, Should-Haves, Nice-to-Haves  Criteria Weighing  Paired Comparisons  Risk/Benefit Copyright 2007 John Wiley & Sons, Inc.Chapter 2012

13.  Many ways to do this  But there are two basic approaches  One master list of prioritized projects  Could end up with less than satisfactory results  Separate projects into buckets and then prioritize the projects in the separate buckets.  Could end up with good projects in unpopular buckets  Author suggests second approach  Takes longer with one master list  Easier to allocate resources along different funding buckets Copyright 2007 John Wiley & Sons, Inc.Chapter 2013

14.  Advantages  More projects into active status  Better chance to control risk  Weakness  Will extend delivery date into next funding cycle Copyright 2007 John Wiley & Sons, Inc.Chapter 2014

15.  Project Status  On Plan  Off Plan  In Trouble  Role of the Project Manager  Keep project on plan  Reasons for off plan  Deficient method of validating task status  Bad communication processes Copyright 2007 John Wiley & Sons, Inc.Chapter 2015

16.  Reporting Portfolio Performance  Schedule Performance Index and Cost Performance Index Trend Charts Copyright 2007 John Wiley & Sons, Inc.Chapter 2016

17.  Acceptance Criteria  Checklist of Scope Items or Requirements  When all items on the checklist are checked off, the project is finished  Post-Implementation Audit  Attainment of Explicit Business Value  Lessons Learned Copyright 2007 John Wiley & Sons, Inc.Chapter 2017

18.  Three Ways to Prepare Your Project Proposal  Adapt the Project Overview Statement  Parts of the POS  Problem / Opportunity Statement  Project Goal  Project Objectives  Success Criteria  Assumptions, risks, and obstacles  Include two attachments  Risk Analysis  Financial Analysis Copyright 2007 John Wiley & Sons, Inc.Chapter 2018

19.  Three Ways to Prepare Your Project Proposal (Cont.)  Two-Step Submission Process  First step is to submit the POS  If the POS has been accepted, then the second step is submit a detailed project plan Copyright 2007 John Wiley & Sons, Inc.Chapter 2019

20.  Three Ways to Prepare Your Project Proposal (Cont.)  New Submission Process  Project Name  Sponsor Name  Project Manager Name  Project Funding Category  Project Goal  Project Objectives  Explicit Business Value  Risks  Estimated Total Project Cost  Estimated Project Duration Copyright 2007 John Wiley & Sons, Inc.Chapter 2020

21.  Background of the Project Support Office  What Is a Project Support Office  Naming the Project Support Office  Establishing Your PSO’s Mission  Framing PSO Objectives  Exploring PSO Functions  Selecting PSO Organizational Structures  Organizational Placement of the PSO  How Do You Know You Need a PSO?  Establishing a PSO  Challenges to Implementing a PSO

22.  Describe a Project Support Office (PSO)  Understand the signs that you need a PSO  Know the missions, objectives, and structures of the PSO  Know the functions performed by the PSO  Know how to establish a PSO  Understand the challenges to establishing a PSO  Know how to grow and mature your PSO Copyright 2007 John Wiley & Sons, Inc.Chapter 2122

23.  Early adopters use the new project management process  Adoption of project management spreads  Management takes notice  There are uneven proficiency levels of project management  Senior management introduces some common tools and metrics for project management  Some adopt the common processes and some don’t causing confusion  Thus the need for a Project Support Office Copyright 2007 John Wiley & Sons, Inc.Chapter 2123

24.  Projects grow in number and complexity  The need for more qualified project managers  Lack of standards and policies leads to increased inefficiencies and lowered productivity  Greater demand on resources requires more coordination Copyright 2007 John Wiley & Sons, Inc.Chapter 2124

25. “A temporary or permanent organizational unit that provides a portfolio of services to support project teams that are responsible for a specific portfolio of projects.” Copyright 2007 John Wiley & Sons, Inc.Chapter 2125

26.  Temporary  Usually called Program Offices  Support the administrative needs of a group of projects  Disbanded when projects are over  Permanent  Handle a changing stream of projects Copyright 2007 John Wiley & Sons, Inc.Chapter 2126

27.  Project Support  Consulting and Mentoring  Methods and Standards  Software Tools  Training  Project Manager Resources Copyright 2007 John Wiley & Sons, Inc.Chapter 2127

28.  Linked through their goals and purposes  Departmental or organizational unit basis  Projects that are funded out of the same budget Copyright 2007 John Wiley & Sons, Inc.Chapter 2128

29.  The author recommends a mission statement that is supportive of project managers  Rather than compelling compliance of standard practices  Supportive statements can be sold easier to project managers and senior management Copyright 2007 John Wiley & Sons, Inc.Chapter 2129

30.  Make the objectives specific  Make the objectives measurable  Provide business value Copyright 2007 John Wiley & Sons, Inc.Chapter 2130

31.  Project Support  Consulting and Mentoring  Methods and Standards  Software Tools  Training  Project Manager Resources Copyright 2007 John Wiley & Sons, Inc.Chapter 2131

32.  Virtual versus Real  Proactive versus Reactive  Temporary versus Permanent  Program versus Projects  Enterprise versus Functional  Hub versus Hub and Spoke Copyright 2007 John Wiley & Sons, Inc.Chapter 2132

33. Copyright 2007 John Wiley & Sons, Inc.Chapter 2133 Centralized – Enterprise-wide Decentralized – Enterprise-wide PSO with Satellite PSOs Unit-Level – Services specific department or project

34.  Standish Group Report  Top Ten Reasons Why IT Projects Fail  Symptoms That You Need a PSO  Project failure rates are too high  Training is not producing results  HR project staff planning isn’t effective  Inability to leverage best practices  Lack of control over the project portfolio  No consistency in project reporting  Too many resource scheduling conflicts  Gap between process and practice Copyright 2007 John Wiley & Sons, Inc.Chapter 2134

35.  Three major questions  Where are you?  Where are you going?  How will you get there?  PSO Stages of Growth Copyright 2007 John Wiley & Sons, Inc.Chapter 2135

36. Copyright 2007 John Wiley & Sons, Inc.Chapter 2136

37. Copyright 2007 John Wiley & Sons, Inc.Chapter 2137

38.  Forming the PSO Task Force  Measuring Where You Are  Metrics to determine current project management maturity  Metrics to determine current proficiency of project managers  Establishing Where You Want To Go  Establishing How You Will Get There Copyright 2007 John Wiley & Sons, Inc.Chapter 2138

39. Copyright 2007 John Wiley & Sons, Inc.Chapter 2139

40. Copyright 2007 John Wiley & Sons, Inc.Chapter 2140

41.  Speed and Patience  Leadership From the Bottom Up  A Systems Thinking Perspective  Enterprise-Wide Systems  Knowledge Management  Learning and Learned Project Organizations  Open Communications Copyright 2007 John Wiley & Sons, Inc.Chapter 2141