Project portfolio management (PPM) is much more complex than project management. Why? Well, a project manager may be responsible for one project in the company. Whereas a project portfolio manager needs to keep an eye on all projects across the organization’s portfolio. This makes a project manager’s job much more complex as various priorities and teams across the enterprise compete for the same resources.
These project portfolio managers need to analyze the potential return on a project based on the entire organization, not just their department or project. PPM tools help teams to organize and consolidate every piece of data relevant to current and proposed projects across the company. Project portfolio managers can then provide forecasting and business analysis when it comes to taking on new projects and gauge how it impacts all projects in flight across teams. To be effective, project portfolio management must be able to zoom out to see the big picture.
Given the proper inputs, the right PPM tool will help you make organization-wide decisions that could affect all projects in the portfolio. The right PPM tool should help you prioritize which projects to tackle first based on strategic needs defined by the organization and whether sufficient resources are available to execute the plan. It should help you properly distribute a finite budget and human and machine resources to the right projects at the right time. And most importantly, your PPM solution should reveal risks or gaps before they occur so you can deploy mitigations and keep the projects on track before it is too late.
It should be clear that a project management tool may not always be able to solve the needs of a portfolio-first approach to managing priorities across the organization. This is why it’s important to understand what makes a project portfolio management tool unique and most effective.
So, let’s consider what a PPM tool should be able to do for your organization…
Prioritize projects based on organization goals
Every organization strives to increase revenue sustainably while maintaining the best profit margin possible. A PPM tool can help you make informed decisions based on organization-wide objectives. PPM software can help leadership look across the portfolio of projects and priorities in flight, providing intelligent insights to assess progress and confidently predict outcomes. Does everyone in your organization know which projects are most important? Are projects and underlying tasks prioritized according to organization importance? As changes occur, are assignments automatically updated to reflect defined priorities to ensure project teams are always working on the most important thing? If not, perhaps your PM or PPM software isn’t making the grade, and it is time to identify an upgrade.
Consider the power of these insights as the next step toward utilizing artificial intelligence (AI) in managing your priorities. It’s critical to select software that can provide this portfolio view and a tool that enables scenario planning to inform decisions that enable you to commit to outcomes confidently.
Reduce Politics When Allocating Resources
Have you ever needed to fight another department for resources? Then PPM software may be beneficial to your organization. Consider the political implications of project planning with the portfolio in mind. By basing resource allocation decisions on organizational goals rather than leadership influence and gut feelings, the proper PPM tool delivers insights, a trusted schedule, and consistent outcomes that remove the politics that plague many project plans and organizations.
Once priorities are clear and a trusted schedule of where resources will be deployed across the organization is established, alignment can be achieved making planning and scheduling projects much easier.
Scenario-Plan When Priorities Change
Has your leadership ever completely shifted priorities, and you wonder how those changes will impact all other projects in flight? These types of changes are inevitable in project management. But wouldn’t it be nice if you could see how these changes really impact the schedule before decisions are made? The best PPM tools are dynamic, scalable and can quickly show you best-case and worst-case outcomes. The best tool I am aware of provides an interface enabling changes in resourcing, priority, or scope as they occur and reflects the impact of these changes in real time across the entire portfolio of projects.
With the proper PPM tool, you can scenario plan how adding projects, changing priorities, and changing resource allocation affects the entire portfolio’s timeline in real time. Most project management tools require a very manual process to update timelines. If the burden of managing manual updates runs you and your team ragged, I urge you to consider LiquidPlanner. Its predictive scheduling engine enables users to simply drag and drop tasks (or whole projects and programs) to change priority order and quickly edit resourcing and estimates, allowing teams to scenario plan easily. LiquidPlanner’s tool runs complex Monte Carlo simulations in real-time to deliver timelines you can trust.
Before committing to a PPM tool, do your research. Don’t make the mistake of selecting a PPM tool that requires you to manually update project schedules across the portfolio when change occurs… because the only real constant in planning is change.Simple, static tools increase the potential for human error, multiplying instead of capturing uncertainty that exists in every project. Instead, choose a solution that reduces uncertainty, dynamically updates when changes are made, and predicts outcomes with 90% confidence. Your team, your organization, and your family will thank you.
Make optimal funding & resource decisions
It can be really stressful to decide which projects to prioritize, giving funding and resources to first. LiquidPlanner can make those decisions easier with a little scenario planning. The right PPM tool should help the organization make the best project funding and resource allocation decisions possible.
While funding is a major component of project planning, so is resource allocation. Project resources are likely the biggest part of your project revenue plan and expenditures. PPM tools can quickly show you what resources are the most constrained across the portfolio so you can eliminate bottlenecks and enable your teams to be as efficient as possible. And they should also show you data on opportunities to go faster on projects.
Inform go-no-go decisions on projects
Today’s teams are chronically over-committed. Why? Most of us are natural optimists and prone to taking on more work for ourselves and our teams than is realistic. We fail to properly acknowledge and seriously consider the uncertainty that exists in every project. As project complexity broadens, the scope widens and volume increases, so does the uncertainty surrounding decision-making and resource deployment even more challenging. The result? Imbalance workloads, constant chasing of deadlines, and burnout.
Let’s say you have a client requesting work on a project your team doesn’t typically have experience in completing. In order to serve this client well, an investment will need to be made in developing knowledge to inform the project work and deliver a quality outcome. While taking on new work is tempting, expanding into a niche you aren’t ready for can quickly lead to reputational and financial disaster for the organization if there are not enough aligned resources available to get the job done.
By predicting outcomes and revealing risk, technology like LiquidPlanner allows teams to model the impact of taking on a new project before teams say even say yes to stakeholders or clients. With best case – worst case planning at the core of the product, teams can incorporate uncertainty into the timeline to better account for the unknowns new project work will bring. Decisions will be easier to make and will be made with more confidence with the right PPM tool that enables this type of scenario modeling.
Analyze project performance across the portfolio
Project management teams may tend to overlook the power of intelligent insights. Oftentimes, project managers can be so bogged down with work that they don’t have the bandwidth to see how past projects performed to understand how they can be more efficient in the future. Knowing how each project is performing should be a critical task for project managers who manage projects for the entire organization so lessons learned can be easily accessed and incorporated for efficiency gains.
The right PPM tool makes gathering these insights easy and seamless. PPM tools should strive to make project manager and portfolio project manager’s jobs easier. Having these real-time insights into many projects is critical so you can make the appropriate changes across the organization. Tools like this can show problems you may have otherwise missed.
Report status on individual projects and the portfolio
Have you ever had a leader stop by your desk and ask for a project update? If you’re a project manager who manages projects across the portfolio, you may not have the information on that particular project top of mind. But an effective project portfolio management tool will make it easy to share project health and status details in the moment.
Better yet, the best PPM solutions will also allow those senior leaders to go into the tool themselves to see how projects are progressing without asking you for a status update. How’s that for efficiency? Project leaders can even see when other priorities and projects may affect their particular project outside their department. That’s the power of having a portfolio approach to project planning.
So, now that you know what a good PPM tool should and could do for you, it’s up to your organization to decide if a PPM is the right path. Suppose your organization has multiple departments and a multi-project portfolio that use the same resources. In that case, it’s likely that your company can benefit from a solution that gives insight into the entire portfolio. There are many options and price levels dependent on your needs. If you haven’t already, I urge you to try LiquidPlanner. They even offer a free plan that is a great resource to get started.