This is something one of my clients regularly repeats about portfolio management. It is important to execute projects correctly, but it is equally important to undertake the right projects, at the right time, with the right stakeholders for the company. What are the prerequisites for portfolio management? What is its purpose? Why do we do it?
I won’t be talking about a miracle recipe because there isn’t one. Establishing a portfolio management practice is a long-term process that requires effort and strong involvement from employees and managers. However, there are key elements to ensure its success.
Do the things right! The importance of first implementing a project management methodology:
A uniform project management methodology is essential to ensure consistency and transparency in portfolio management. This can include adopting recognized frameworks like PMI (Project Management Institute) or PRINCE2, tailored to the company’s specific needs. It might also be a custom method for the company, but the important thing is that it is shared and that employees are trained (we can assist you with our Digital Academy).
With our clients: Even though the broad definition of a project has been widely shared, many questions arise about the exact definition. When is a request considered a project? Is it defined by budget, human resources, or time spent?
We believe it is necessary to define at a minimum for the organization/team:
- What is a project? Key elements for defining a project.
- Project phases: What happens in each phase and the criteria for moving from one phase to another.
- Metrics/KPIs: How do we know if a project is going well or not?
- Roles in the project: Who does what and when?
- Deliverables: What should be delivered and how?
- Monitoring and control instances: Ensuring project success.
- Roadmap: How do we get there?
- Value creation: What do we bring to our client? The project’s purpose.
- Interdependencies: What do I need to complete this project?
- Resource management and capacity to execute
Developing a project management culture at all levels involves:
- Training teams and supporting them in project management
To ensure long-term success in portfolio management, it is necessary to develop a company culture focused on project management. This involves training teams, promoting good practices, and recognizing the strategic value of project management. Managers and the PMO propose and support these project management practices within teams.
Implementing a project management methodology is akin to implementing a new process, new templates, and new benchmarks for teams. It means leading a change project and transforming team practices.
To ensure employees understand and adopt the proposed tools, we support them in adopting the methodology through training, workshops, individual follow-ups, and simply being available to answer their questions. We aim to gradually build the skills of employees and managers, not through a big bang approach. We explain each step, provide context, revisit the stakes, repeat, and take time with employees and managers.
With our clients: We have implemented new project reporting models, initially working with them through regular rituals. After several weeks, we let them fill in these project reports and now provide occasional support as needed.
- Supporting managers through their frustrations
Managers may have a vision of what project management should look like within their team: they see the top, the final brick. To prevent clients from feeling frustrated when their teams do not meet their expectations, we collaborate with them to identify the steps necessary for gradually improving their teams’ skills.
We encourage them to define clear expectations and provide appropriate support. By doing so, our clients can play a crucial role in the effective adoption and application of project methodologies by their teams. We work with managers to help them recognize their teams’ achievements and progress. It’s sometimes important to reaffirm where we started from.
With our clients: In a recent project, we assessed current practices to show both the gap with the ambition and to get inspired by the best practices already in place.
We don’t leave project managers out. Managers can also be frustrated by the varying levels of team maturity within the same department. Therefore, it is important to ensure that the team responsible for the portfolio/projects offers tailored support to each team, perhaps even proposing pairings between project managers from different teams or other systems to facilitate direct knowledge and practice transfer among peers.
Do the right things! What is the purpose of portfolio management
Portfolio management is not revolutionary, and despite that, it is often an immature practice among our clients. However, when implemented correctly, it brings:
- Clear prioritization: A project portfolio allows for prioritizing initiatives based on their strategic importance and expected contribution, aiding executives in making informed resource allocation decisions.
- Alignment with strategy and value creation: Well-managed portfolios ensure close alignment with the company’s strategic objectives, guaranteeing that projects significantly contribute to achieving the organization’s overall goals.
- Unified direction: Portfolio management goes beyond just listing projects, especially at project initiation. A well-prepared project in the right conditions helps agree on project types, selection criteria, and serves as a common basis for project arbitration discussions.
- Improved visibility and transparency: Centralized portfolio management provides increased visibility across all projects, enabling stakeholders to easily track progress, make informed decisions, and identify areas needing special attention.
- Engaging employees: Including a project in the portfolio also means embedding it in a global approach, easily demonstrating the employee’s contribution to the company’s strategy (questions like: what external elements support this project; what will it be used for/what will its impacts be; what is the interest for the employee to participate in this project).
Finally, a project is not an isolated bubble
It is important to remember that “a project is not an isolated bubble.” Implementing practices on these topics allows employees to develop numerous other skills:
- Taking a broader view and integrating their work into the company’s vision
- Strengthening relationships with other departments through demand management
- Managing resources and capacities needed for successful project execution
- Understanding adjacent or dependent topics through dependency management
