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PROJECT PORTFOLIO MANAGEMENT Concepts Généraux. PPM Definitions  The first is a direct quote from the PMI PMBOK – “ the selection and support of projects.

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Presentation on theme: "PROJECT PORTFOLIO MANAGEMENT Concepts Généraux. PPM Definitions  The first is a direct quote from the PMI PMBOK – “ the selection and support of projects."— Presentation transcript:


2 PPM Definitions  The first is a direct quote from the PMI PMBOK – “ the selection and support of projects or program investments guided by the organization’s strategic plan and available resources.”  This involves a decision making process. The concept of being guided by the organization’s strategic plan and the available resources which means being very aware of the organization’s goals and objectives and also all types of resources that are available for projects.”  Second definition comes from the Managing Multiple Projects book published by the Center of Business Practices which defines PPM “as a process for ensuring the consistent selection, prioritization and planning of the right projects for the organization”. This particular definition begins to shed light on the different components of PPM – which include evaluation, selection, prioritization, budgeting and planning once again based on value and strategic fit with the organization.

3 PPM  It uses…  An identification of Projects  An evaluation of Projects  A prioritization of Projects  So as to …  Check if projects meet the Enterprise Strategic Goals and Objectives  Optimize Resource allocation  Provide different analysis (Cost and ROI analysis, Risk Analysis, Strategic value analysis)  Which provides …  Visibility  Standardization  Measurement  Process Improvement

4 PM and PPM Value Ability to Realize Business Value Potential 75%100% 66% 100% 0% Portfolio Management Project Management 50% Value Realized Portfolio Management – to identify and select the investments that will maximize organizational value Project Management - to successfully deliver the selected business value opportunities Optimal integration of portfolio and project level capabilities allow maximization of business value Ability to Identify Organizational Value Potential

5 PPM Steps 1.Construire le Portfolio : Nouveaux Projets ou idées 2. Prioriser / Sélectionner 3. Planifier / Affecter 4. Mettre à jour et Piloter 5. Revues, Priorisation / Sélection 6.En attente ou arrêté ou clos

6 Construire le Portfolio  Standardiser la définition des projets  Définir et mettre en œuvre des modèles de fiches projets / idées (Project Charter)  Définir les propriétés  Définir les business drivers  Définir les processus de collecte des informations

7 Project Registry  Minimum information requirements for the Project Registry include  Project Sponsor name  Project Manager name  Project priority ranking  Target milestone schedule  Resource requirements  Identified domain within the project portfolio

8 Prioriser / Sélectionner  Prioriser  Définir les Business Drivers  Valoriser les Business Drivers (Donner un poid à chaque BD)  Evaluer la valeur stratégique de chaque projet  Sélectionner  Définir les contraintes  Ressources (Compétences)  Budget  Techniques  Optimiser les ressources en respectant les contraintes

9 Business Driver Strategic Goal: Business Driver Name: Retain existing clients Grow Customer Share of Wallet Dedicate our resources to those market areas where we can maintain our existing client base and increase share of market of current clients Business Driver Definition: Sell additional products to existing clients Maintain clients and remain competitive in existing markets KPI’s: Client Satisfaction Rates Client Retention Rates Variance in % Market Share % Increase of Market Share Increase in Revenue Business Driver Name: Business Driver Definition: KPI’s:

10 Tangible Intangible Typical Project Criteria  Strategic  Proprietary Position - how easily copied  Support of Core Competencies  Brand Enhancement  Commercial  Market Impact  Market Need  Market Timing  Technical  Feasibility  Complexity  Financial  Earned Commercial Value (ECV)  Net Present Value (NPV)  Internal Rate of Return (IRR)  Return on Investment (ROI)

11 BD Priorisation Indicates relative importance of Driver A vs. Driver B (row vs. column) Compares the relative importance of Driver B vs. Driver C (row to column) The Pairwise Comparison is a proven technique for deriving relative priorities or weights for Business Drivers through performing one-to-one comparisons.

12 Priorisation High Risk Low Risk Fort Bénéfice Faible bénéfice C B E D G J H K I A F L N M O Q P R Example: Size - Effort Color - Organization

13 1 Cost L - Priority - H Portfolio Analysis/Optimization 23 Optimization techniques allow organizations to select portfolios that will deliver the maximum strategic and financial value Use charting techniques to analyze the portfolio Optimize the portfolio under varying budgetary constraints Break constraints and reach the Efficient Frontier Sélectionner les bons projets

14 Requirements For PPM Success  Well defined enterprise goals and objectives  Established and maturing PM processes  Project reporting and analysis capabilities  Integration of project (enterprise) resources  Executive support of portfolio process  Reevaluate Project Portfolio on a Regular Basis  As Project datas are changing quickly  Market is changing quickly  Enterprise Objectives can change  The Project Portfolio must be reviewed very often

15 Benefits Of Portfolio Management Validate business strategy and align projects Eliminate redundancies Improve resource utilization Improved schedule performance and time-to-market Reduced staff overload and attrition Facilitate the process of adding, sorting, killing projects so as to meet the Enterprise Objectives

16 Consistent Progress Towards Best in Class 2001 2002 2003 25% 50% 75% 100% Efficiency 41% Prioritization Only 62% Prioritization & Optimization 81% Prioritization, Optimization & Adv Analytics Alignment with Best Practice Low Medium High Annual Planning 89% Prioritization, Optimization & Adv Analytics 2004

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