Early on, I was conditioned to learn project management in its most simplistic form; to ensure delivery of a project(s) on-time, under budget, and within quality levels satisfactory of its stakeholders and sponsors. At that time, I had an epiphany; if I could effectively check-mark these three boxes time and time again, I will have excelled in my role as the almighty Project Manager and add inevitable value to my organization.
Lo and behold, through repetition, successes and errors, as well as my good friends at the Project Management Institute (PMI), my hypothesis was proven to be accurate. At the time, I was checking the boxes and reaping the reward as a Project Manager. Yet, not every Project Manager saw the same success. Was I that much better at managing projects than my peers? Or was something in the system hindering them from realizing success?
The Ecosystem of Project and Portfolio Management
Not until I moved into consulting (and began holistically working with organizations of all shapes and sizes), did I conclude the approach of managing projects was not as singularly focused as I once thought. Rather, there is a much more complex “ecosystem” in which project managers operate. This ecosystem is the key to truly effective project management, and truly effective project management is a key input to the ecosystem. Although many organizations are beginning to understand this concept, those same organizations are struggling to materialize its value.
Project and Portfolio Management (PPM) is the foundation of the project management ecosystem. According to the PMI Community, “Project Portfolio Management is the centralized management of one or more portfolios, and involves identifying, prioritizing, authorizing, managing, and controlling projects, programs, and other related work, to achieve specific strategic business objectives.” Conceptually, PPM is no new concept. It has been around for years, but has especially blossomed alongside shared service centers like the Program Management Office and the recent trends of transforming IT organizations from cost centers to value centers.
The PPM Hierarchy
At TSI, I’ve helped organizations understand its current state of PPM capabilities and
evolve using our PPM Maturity Hierarchy. Beginning at the Level 1 “Infancy” stage (or whichever stage an organization currently sits), the objective is to evolve the organization’s PPM capabilities to a Level 4 Optimization stage and beyond.
Level 1 – Infancy: Organizations within the Infancy stage tend to manage projects in a reactive manner, singularly focusing on the execution of individual projects. The organization often scrambles to stay on top of daily demands. Work is captured on a project by project basis with little to no transparency of synergies and risks between projects. Project financials and risk is not monitored closely.
Level 2 – Emerging Discipline: The Emerging Discipline stage replaces project by project decision making with identification of the best collection of projects. Organizations at this stage are successfully prioritize and align projects with strategic initiatives.
Level 3 – Initial Integration/Value Management: Within the Initial Integration/Value Management stage, organizations are introducing technology, models and tools to quantify the value derived from projects. This allows organizations to identify projects within the pipeline that provide the most “bang for your buck”. Proactive, standardized PPM enables value driven decision making.
Level 4 – Optimization: Once the Optimization stage is reached, the focus of an organization moves to maturing the PPM capabilities. This involves a focus on optimizing process, analytics, quantitative metrics and improving value creation.
Level 5 – Innovation: At the most advanced stage of PPM maturity, Innovation, PPM has full buy-in from executive leadership. It is now a core competency of the organization that utilizes best practices and processes. The organization is now focusing its attention innovation and continuous improvement.
Is your organization looking to take the next step in Project and Portfolio Management? Do you have questions on where to get started? If you’d like to brainstorm with one of TSI’s consultants, or have any questions on how we help organizations similar to yours, feel free to reach out to me directly at email@example.com. You can also visit our website at www.transforming.com for more information.