Project Portfolio Management Strategy Guide

In today’s business landscape, project portfolio management (PPM) has become an increasingly crucial practice for project-oriented firms. For those businesses looking into the approach, this Project Portfolio Management Strategy Guide aims to clarify the difference between project and portfolio management, cover PPM basics like methodologies and capabilities, and offer insights into effectively implementing PPM. Serving as a valuable resource for project teams, leaders, PMOs, and executives, it addresses challenges, provides an overview of PPM tools, and introduces the next step — Enterprise Project Portfolio Management.

Common Project Portfolio Management Challenges

While there are infinite benefits to PPM, it also comes with some potential challenges. However, a PMO or project manager can eradicate most of those pain points, especially when supported by an industry-grade PPM software tool like Sciforma.

4 Potential Project Portfolio Management Challenges

PPM is not always a smooth ride; any professional of the discipline can tell you as much. Harnessing the full power of PPM requires overcoming a number of obstacles and challenges.

1. Lack of Data Visibility

Today’s businesses and organizations are flooded with data. What’s more, as organizations grow and evolve, their sources of data tend to multiply. When data is disorganized, hard to access, or unreliable, it becomes an obstacle rather than an asset. This can result in many project portfolio management challenges, ranging from inaccurate or duplicated data to incorrect filing of compliance information.

2. Lack of Prioritization

As visibility improves, organizations sometimes find how projects are selected and prioritized is not optimal for the business. Sometimes projects are approved based on executive order or by what comes in first. While this is common, it isn’t necessarily the best PPM method and can be improved with value-based prioritization.

3. Inadequate Risk Management

It is always tempting to just pretend that PPM risk doesn’t exist. However, allowing for risk is instrumental to the successful management of portfolios of projects. Without some level of risk awareness and management tactics, you may not be setting your work up for success.

4. Lack of Governance

PPM governance refers to the standards and mechanisms that determine decision-making authority and accountability regarding a project portfolio. Good governance is about providing the right information to the right people, at the right time, and empowering them to make the right decisions. It also ensures consistency and replicability in PPM activities.

A lot of project-oriented organizations create dedicated steering groups to provide guidance to their key portfolio of projects. A PPM steering committee is a high-level governance body appointed to oversee and “pilot” the portfolio. It complements the work of project and portfolio managers while providing them guidance.

How to Overcome Common Project Portfolio Management Challenges

Let’s now explore some of the process top performing organizations are using to avoid these roadblocks.

Project Planning

Consistent planning tools and templates ensure that each project has a standard set of tasks. Not only does this ensure all the important details are covered, but it also saves time for project managers and helps teams understand what’s required of them. What’s more, effective project planning leads to more accurate and consistent cost estimation, which naturally increases your likelihood of delivering on budget.

Time and Expense Logging

Most organizations record time via some form of system, spread sheet or app. But have you ever taken time to stop and really understand the benefits this data brings to the organization or to assess whether you are maximizing its use? Top-performing PPM solutions like Sciforma make time management simple, ensuring that project teams can access intuitive ways to log their progress and communicate it to others.

Proactive Risk Management

Organizations should implement a sound process to identify, manage , and mitigate risk before the project begins. Creating a system to assess evolving or new risks during project completion might also be necessary. Key performance metrics combined with open communication with stakeholders can help project managers develop a risk management approach that makes sense for their organizational goals.

Project Status Reporting

All too often organizations rely on numerous different spreadsheets, in different formats, for their PPM reporting. These disconnected files are almost impossible to consolidate at a senior management level, making it difficult to make decisions.

Project managers are required to submit reports on a regular schedule and in a clear and consistent manner. Project management software is key to achieving consistent reports that are accessible to all. With this information, executive teams can compare project progress in order make vital decisions about reallocating resources across the portfolio.

Project Portfolio Management Strategy Guide

Table of Contents

Common Project Portfolio Management Challenges