It is important for an organization to manage and categorize their project portfolio while handling several projects. Categorization helps in the alignment of projects with the goals of the organization. PPM or Project Portfolio Management is actually a management process. The purpose is to help the organization gain information using several methods so that projects can be analyzed and sorted according to certain criteria.
Some benefits of Project Portfolio Management
- The organization is able to easily adapt to changes in the business environment
- Generation of higher returns as a result of constant updating and reviewing of projects
- Enables the organization to focus on strategies best suited to achieve targets
- Provides an edge over competitors
Tools for Project Portfolio Management
An organization can use several tools for PPM. Some of them include:
- Evaluating projects using suitable and systematic methods
- Planning of resources
- Performing a Cost Benefit Analysis
- Getting timely access to required information
- Preparing project reports on a regular basis
Important questions to be analyzed under PPM
Managers who plan PPM procedures need to focus on essential questions that need to be addressed. These include the following:
- Is the organization making a correct investment in the right project?
- Is the company’s capacity being utilized optimally?
- Is execution of plans actually taking place?
- Can all the changes be successfully incorporated by the organization?
- Are all the estimated benefits being realized?
This model, addressing five vital questions with regards to Project Portfolio Management, indicates that the project manager should take an initiative to answer these questions before the project begins and also during the time of its execution.
The successful implementation of the project is highly dependent on answering the above mentioned questions.
Project Portfolio Management process
It is true that many organizations fail to put a Portfolio Management process in place. The following steps can be taken to define a process for PPM:
- A structure for portfolio management needs to be defined.
- A plan for Portfolio Management needs to be laid out.
- There is also a need to decide on the Basic Evaluation Metrics.
Once the process of defining as well as choosing and executing the portfolio is in place, the organization can undertake important steps towards Project Portfolio Management.
The aim of Project Portfolio Management is essentially to bring down inefficiencies reduce potential risks while dealing with various projects.