Not so long ago, Project and Portfolio Managers were using pencils and sheets of paper to plan and manage their projects. The rise of Information Technology and the spread of desktop software suites have made calculations much easier and introduced some degree of task automation into Project Management practices. As technology marched on, dedicated Project Management software programs came into existence to help Project Managers plan, organize and manage their resources and projects.
The culmination of the evolution of technology tools for Project Management professionals takes the form of Project Portfolio Management software. Such solutions take the management discipline to the next level by enabling consolidated and consistent management of large quantities of interdependent projects, programs, plans, tasks and resources. They help Project Management Offices and Portfolio Managers plan and run projects in an organized, accurate, and profitable manner in order for their organization to stay competitive, to improve customer and stakeholder satisfaction, and to position itself for the future. Here is an overview of the ways PM and PPM software work, and how you can leverage such tools to your advantage.
Project Management Software: Enabling Technology for Project Managers
Project Management software tools are technology products that enable Project Managers and project teams to perform an array of management activities on individual projects. They facilitate project planning, tracking, and monitoring by increasing visibility into project activity, letting Project Managers know who should be working on what, at and by what time.
Built-in Gantt charts, calendars, timesheets, and budget plans assist Project Managers in their work throughout the project life cycle and facilitate the day-to-day management and delivery of projects.
Among the core benefits of Project Management software tools is the intelligent automation of planning, scheduling and tracking tasks. Automatic tools and features help scope and map out project milestones and deliverables at the planning stage. Then, automated tracking functionality measures project progress against the plan in real time, helping Project Managers make sure that everything is up to date and going according to expectations. Some of these PM tools will also feature resource management capabilities to optimize the allocation of resources automatically, or functionality for time tracking, budget management, collaboration, and reporting.
Remark: The term Enterprise Project Management (EPM) software generally describes PM software products with greater capacity and the ability to handle larger numbers of individual projects.
Key Functions and Benefits of Project Management Software
One of the primary purposes of dedicated Project Management software is to help Project Managers build a sound foundation for their projects by taking the guesswork out of creating project planning, schedules, estimates and forecasts. Intelligent planning features take into account the work schedule of resources as well as previous project track records (some PM tools provide pre-filled project models reusing knowledge from past initiatives) in order to help Project Managers establish accurate, reliable road maps for completing their projects successfully.
Those Project Managers in charge of handling multiple projects in parallel get visibility on their whole pipeline, as the software gives an overview of all completed, active and planned projects. This way, they can address issues and bottlenecks before they occur.
Many Project Management tools come with functions dedicated to the optimization of project resource allocation, helping Project Managers make sure that everyone is working on the right tasks at the right time. Resource planning is of paramount importance in Project Management. Project Managers need to ensure that the right resources can be mobilized for each phase of each project. Software features such as resource heat maps provide visibility into the inbound work demand and capacity of the resource pool, detecting issues and bottlenecks and helping strike the best balance. In addition to facilitating and speeding up the resource allocation process, such resource visibility helps Project Managers anticipate resource shortage and staffing decisions.
PM tools also improve Project Managers’ ability to deliver projects successfully within the allotted budget. Project Management software helps control and manage project budgets from the initial quote to the final invoice. Budget planning capabilities enable project managers to forecast and estimate future costs and perform various ROI calculations, while real-time budget management and time tracking features help keep check of the cost of human and technical resources throughout the execution stages.
Monitoring and Reporting
Dedicated Project Management software plays a key role in monitoring the progress of work across the various stages of projects, offering valuable insights into project health and status.
Thanks to accurate time and budget tracking, with data consolidated in real time, Project Managers are able to monitor the evolution of project times and costs, assess whether initiatives are on track to succeed, and take action if needed. Tools also provide automatic up-to-the-minute reports and dashboards to report on that progress to senior management.
Project Management software will provide communication channels and funnels for project teams. Shared files documenting the requirements and specs for tasks and projects will enable everyone concerned to access comprehensive information, with built-in messaging and commenting systems to facilitate instant team communication.
Project Management software can also improve external communication with clients, suppliers or other stakeholders. This is because the latter can be given access to the system in order to review the specific project information that is relevant to them and provide direct comments.
As they increase visibility and communication, Project Management applications also promote collaboration among project teams. They will support breaking down projects into smaller, individual tasks for designated team members. For instance, project Kanban views or boards help keep everyone updated on project progress and activity breakdown. This way, each team member knows clearly what the others are working on and can get an at-a-glance understanding of their own place and role in the life of the project.
All in all, tools provide a forum and framework for project workers to interact, collaborate, and discuss the best ways to achieve what the whole team is trying to complete — fostering project team alignment.
When Project Management is No Longer Enough
Unquestionably, basic Project Management software can improve the handling of single projects significantly. It will help streamline the workflow for Project Managers and establish a good framework for planning and tracking projects. However, as your organization and your Project Management process grow in experience and maturity, your Project Management Office or structure will likely take on more projects, and larger projects. At that point, tools primarily dedicated to managing individual endeavors may not allow you to oversee large numbers of simultaneous projects with the same success and effectiveness.
At scale, managing programs or a portfolio of projects requires an understanding of the relations, links and dependencies between multiple projects across various areas of the business. When running a full array of projects, Portfolio Managers and PMOs need to know which initiatives should be prioritized. In other words, where the organization should invest time, resources, and budget in order to maximize value. They need the ability to assess the business value of multiple projects and their strategy alignment. A granular understanding of all the aspects of projects is necessary to maximize their chances of success. Additionally, the larger the projects, the more complex and challenging they are.
As a result, project-driven organizations eventually reach a point in their development where ensuring the success of many important projects demands more than a basic Project Management tool.
From Project Management Software to Project Portfolio Management Software
That’s where Project Portfolio Management software comes into play. PPM software is a business solution designed to help handle a collection of projects as a whole. Project Portfolio Management products enable users to manage a pool of projects, programs, products, and portfolios, taking in consideration their relationships with one another and with the business objectives. They provide users with a central platform to see and manage the overall effort. They allow PMO and PPM leaders to take a step back from traditional project management in order to gain comprehensive visibility and improved understanding of the project timelines, resources, and business goals from a higher-level perspective.
Benefits of PPM Software
Such platforms improve visibility into the performance, health and progress of current projects. They show resource demands in real time, with ability to compare against estimates. They consolidate the information regarding both in-flight and forthcoming projects, showing the dependencies between the various initiatives and with the rest of the business and providing project management executives with a global view.
In addition to this top-down oversight, PPM software provides tools designed to help PMOs manage the coordination of projects and resources across the enterprise. In short, PPM software tools aim to ensure the completion of all projects at the enterprise level, on time and within budget, and the achievement of targeted business goals. They provide the factual information that is needed to help senior management decide where to invest the firm’s time, budget and resources in order to maximize return.
Whereas managing projects using a collection of multiple tools and desktop software or applications increases the risk of duplicates, redundancies and inadequacies, centralizing all PPM-related activities and data into a single, enterprise-wide system provides a single version of the truth for all project portfolios. Project Portfolio Management software can usually be interfaced with other enterprise systems, such as ERPs, in order to collect and aggregate relevant project data.
Thanks to the clarity they provide to PMOs and decision-makers, PPM tools are increasingly sought-after in a troubled, ever changing business climate. In fact, a ReportLinker study shows that the global Project Portfolio Management (PPM) market is expected to grow from USD 4.2 billion in 2020 to USD 5.6 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 6%.
Key PPM Software Functionalities
From risk assessment to resource allocation, industry-grade Project Portfolio Management software can offer a wide array of features and capabilities covering the whole life of project portfolios. Here are a few of the key management capabilities that PPM software will usually provide.
Resource management features enable Project and Resource Managers to distribute and allocate financial, technical, and human resources in order to maximize the overall value at portfolio-level and increase the efficiency of resource utilization. They assist in ensuring that all resources are working at optimum capacity and that the most valuable critical resources are assigned to the highest-yield initiatives.
Project Portfolio Management software will help detect potential project risk early on in order to mitigate it. Automation-assisted risk identification and analysis make it possible to determine confidence levels across project portfolios. These scorings will in turn inform resource allocation decisions. Based on this knowledge, Portfolio Managers can enforce best practices and are empowered to take steps to diversify risk across project portfolios.
Financial and budget management features show the projected payback and financial value of projects and portfolios against the firm’s objectives. They make it possible to anticipate incoming and outgoing cash flow and to track the progress of costs and revenue across projects, in real time. They will also provide a range of metrics and analytics to help predict and manage financial value at the level of the portfolio.
Executive-level business insights from Project Portfolio Management software assist senior decision-makers in the selection and prioritization of the investments that align best with the company’s goals and strategy.
Since PPM systems provide information about the performance and resource needs of active projects and about the impact of future projects, showing links and dependencies, they enable Portfolio Managers and PMOs to compare the actual progress against their strategic plans and objectives in real time.
All these features may include capabilities for building ‘what-if’ scenarios across the portfolio.
How to Select the Right Project Portfolio Management Software Tool
Today, businesses large and small can find a wide selection of PM and PPM software solutions to choose from. The abundance of options can actually feel overwhelming for companies or PMOs looking for a tool. Some industry-specific PPM vendors even offer niche solutions customized to particular market verticals — for example healthcare, manufacturing, education, government, construction, and so on.
The best software for your business will depend on your company’s size, your business objectives, and your specific PPM requirements. Analyzing these will let you determine what are the core functionality and the specific integrations that will be necessary in order for your PPM system to satisfy your goals.
Additionally, when comparing Project Portfolio Management software, you can consider the following to help you differentiating between platforms:
Ease of use
Software should be perceived as an enabler and not as a hindrance. It is essential to select a tool with a user-friendly interface and clear, engaging screens, offering the ability to perform operations at the push of a button. Having an intuitive, user-oriented solution should significantly facilitate and accelerate user adoption. Ideally, a PPM solution should also be easy to maintain for admins, and fast to implement to achieve quick ROI.
While traditional, linear delivery methods inherited from the industrial world have prevailed in PPM in the past, they are now increasingly challenged. Growing numbers of companies are embracing Agile models or devising their own hybrid methodologies. Today’s businesses should make sure they have the ability to change or adjust their Project Management process in the future. For this reason it is key that your tool doesn’t confine you to a specific methodology. Prefer a solution that is flexible enough to support a variety of methods and processes.
Cloud-based Project Portfolio Management software solutions have been gaining traction over the past decade and are now the most popular option. They offer a more flexible experience to users as they enable virtual teams to access information anytime, from any location or any device, and they do not necessitate the purchase of servers, databases or firewalls.
Yet SaaS (software-as-a-service) vendors should provide evidence of their commitment to information security, including the protection of personal and sensitive data. It is a good idea to select a provider boasting an Information Security certificate — such as ISO 27001 — from a globally recognized institution.
The rise of SaaS project management tools, combined with the spread of new usage patterns, has fuelled demand for PPM mobile apps. With the entrance of newer generations into the workplace, this trend is expected to continue.
The first-time introduction of a PPM tool into a company, or the switch to a new system, can raise a number of technical and organizational questions and challenges. Make sure you can rely on the support of an experienced vendor with a track record of successful implementations.
Your technology partner should commit to offering professional services and deployment support, as well as responsive ongoing support in case of queries or issues down the road. Also consider the options for admin and end-user training and the schedule for new features releases.
Project Management tools centralize data and automate activity at project level, augmenting the abilities of Project Managers and project teams. Some of these solutions cover the whole chain of Project Management activities — planning and scheduling, time management, cost and budget management, resource allocation, communication and collaboration, demand management, quality management, and so on — and are ultimately yielding all sorts of benefits for the execution and delivery of individual projects.
However, when the time comes to move up to the next level, organizations should consider Project Portfolio Management software. With the consolidated visibility and the range of advanced management capabilities it provides, a solid PPM software tool will enable your PMO to take in more initiatives and run them in parallel, helping your organization grow more competitive and profitable.
- Any project-driven company stands to benefit from the deployment of a Project Management tool, which will help Project Managers improve the efficiency of delivery for individual projects.
- As project activity scales up, it becomes warranted to adopt a Project Portfolio Management solution providing cross-organization visibility and insights in order to enable integrated Portfolio Management.
- The choice of the piece of software that is right for you should be made based on a number of considerations, including the size and line of activity of your business, your specific PPM objectives and requirements, and the expectations of your end-users and admins.