Benefits and Beyond: Rethinking the Strategic Value of Project, Program, and Portfolio Management (Mark Langley-PMI and Matt Light, Gartner )
- We need to be able to answer the question, “Why did we do what we did?”
- Benefits realization is a process throughout the project management lifecycle (among high performing organizations) not just at the end.
- We have an increased need for leadership.
- We need two types of project managers: those who are project capable, and a select group of turn-around artists who can also train/mentor junior project managers.
- Benefits realization = ACCOUNTABILITY, which requires a ‘culture of PPM’
- Organizations should match talent with appropriate projects
- If you don’t have a business case, you are guaranteed to not know whether you achieved anticipated value
- Finally, it requires leaders to deliver benefits
Follow the Yellow Brick Road (Michael Hanford, Gartner )
Pros and Cons of Centralized PMO
- Pros: Can develop a better project management culture faster, everyone reports to the same director
- Cons: business knowledge ages, disconnected group from the rest of the business
Identifying and Harnessing Complexity in Projects, Programs, and Portfolios (Robert Handler, Gartner )
- See: A Leader’s Framework for Decision Making for more information on the Cynefin model
- Work in the Simple area of the Cynefin model should not be projectized
- 80% of projects reside in the complicated area
- 20% of projects are likely in the complex area (but drive 80% of the value).
PPM Marketscope (Daniel Stang, Gartner )
- Out of the box report is weak for many PPM vendors
- Most companies never get past time tracking
- It can take 3+ years to resolve resource management challenges
- With new implementations, start small and provide ‘just enough’ visibility
I am attending my first Gartner conference and have included some of the highlights from day 1 below:
It’s about risk. Don’t apply process overhead to low risk efforts.
Today’s status has something for pleasing everyone, but the full truth for no one.
Don’t ask everyone to ‘run’ when walking is ok.
Business cases may be ‘adorable’ but emotions still drive executive decision making.
Take a holistic approach–focus on outcomes first, process second.
Power PMO (Matt Light – Gartner )
Defective business cases lead to defective portfolios.
“Only when you see value are you able to tell what is waste and then start to get rid of it”
Portfolio value at the beginning of the project lifecycle is not approving wasteful projects
Portfolio value at the middle of the project lifecycle is cancelling or fixing poorly performing projects
Portfolio value at the end of the project lifecycle is reviewing the project benefits and results
PPM Maturity Workshop (Donna Fitzgerald – Gartner )
Don’t throw process at a level 1 organziation
Slow down just enough for level 2 organizations
“Real” portfolio management begins at level 3.
No individual heroic effort will get you to level 4. The enterprise must go with you.
Level 5 (if achieved) only lasts a few years and will fail after key senior leaders leave.
PPM Governance (Robert Tawry – Gartner )
Either get your process well established first OR buy a tool that is easily configurable.
You can optimize resources for speed or efficiency. If you optimize for speed, contributors should only work on 1 project. If you optimized for efficiency, you should do 3 or less projects simultaneously.
Portfolio optimization entails all the steps necessary to construct an optimal portfolio given current limitations and constraints. These steps occur repeatedly in the portfolio management lifecycle and work in tandem with Stage-Gate processes for selecting the right projects. The purpose of optimization is to maximize the portfolio value under certain constraints. Understanding and managing these constraints is critical for making portfolio optimization a useful component of the portfolio management process.
We can optimize a portfolio in multiple ways:
1) Cost-value optimization (aka ‘efficient frontier analysis’)
2) Resource optimization (aka ‘capacity management’)
3) Schedule optimization (project sequencing)
4) Work type optimization (portfolio balancing)
The question then is, when we are optimizing the portfolio, what is it that we are optimizing? Many portfolio management computing systems promote efficient frontier analysis which commonly focuses on cost-value optimization. However, as useful as this is, it does not often take into account resource optimization, schedule optimization, or even work-type optimization. It is possible for portfolio systems to include some of these constraints, but most are not advertised in that way.
Furthermore, it is fundamental to understand the limitations and constraints on the portfolio, for without knowing the constraints it is not possible to optimize the portfolio and maximize organizational value. The constraint for cost-value optimization is the available budget. This helps us determine an optimal budget based on limited financial resources. The constraint for resource optimization is human resource availability. This can be measured in a number of ways and will be discussed in another post. Optimizing against critical resource availability is recommended. Schedule optimization is focused on project timing and dependencies. Work type optimization is focused on categorical designations (i.e. portfolio balancing—how much do we want to invest in key areas).