Project portfolio management (PPM) is about the management, control and accountability of all programs, projects and related activities of an organisation.
Projects are valued according to a range of criteria. In addition to the financial cost and potential contribution to the company they are also scored according to market attractiveness, leverage of core competences, alignment to strategy, product and competitive advantage offered and the technical feasibility.
The marcus evans Strategic Project and Portfolio Management virtual event, taking place from 2nd-4th February 2022, has invited a range of practitioners to discuss the tools and techniques they are using in their businesses.
Laurent Maceyko, the R&D Efficiency and PMO Manager at Schneider Electric, will be discussing how to build a balanced and profitable portfolio, particularly the use of project selection tools to align projects and programs with the organisational purpose and 3-5 year strategy. These tools assess the project according to multiple criteria – strategic alignment, sustainability, project feasibility and risk.
To avoid demotivating teams, he recommends board level communication to explain both the short term and long-term vision.
He says: “If we need to kill a project, the board has to explain the reason why the project is no longer aligned with the strategy. This could be that the project has been assessed as too risky, the market is decreasing market, or it does not align with the company ethics.
“For some important projects, change management action has to be put in place.”
Paul Beelen is the Global Project Portfolio Manager for international dairy products company FrieslandCampina and also the Chairman of the board of Association for Project Portfolio Managers (BVPPM).
Paul has over 11 years’ experience as a consultant in the field of project management portfolio and its underlying processes using project management tools like Clarity.
Surprisingly he recommends using PowerPoint and Excel to be the best tools for supporting the invest/kill decision on major projects, with the narrative being communicated with PowerPoint. However he explains that the Project Portfolio Management tools can extend the insights: “The relative value of the projects is assessed using strategic pillars as not everything can be valued in monetary terms, other metrics, such as sustainability are also important.”
Florian Friedrich, Director, Head of Enterprise Project Portfolio Management (EPPM), Allianz Global Investors is to talk about ‘Introducing Project Portfolio Benefits Tracking and Financial Reporting to Support Cross- Functional Decision-Making Processes’. He says that over the last two years the company has conducted many “make me better” workshops. These reviewed early stage ideas with the support by experts within the firm.
He says: “The workshops have led to a higher quality in the analysis of the potential project or a decision not to proceed with the idea. This is an approach that has been promoted by John Strelecky in his motivational book “The Big Five for Life”.
He stresses the need to make the kill decision quickly, “By bringing together quantitative and the qualitative assessments that are mapped to a set of benefit types, you can make the project portfolio comparable across multiple functions. Furthermore we have something like a global investment allowance budget, which is used throughout the year to fund new and prioritised initiatives in order not to tie approvals to the annual budgeting processes.
“These measures, in addition to piloting and proofing concepts means that if you are going to fail, then you fail fast.”