Project Portfolio Management and Overview of Best Practice Guidance (MoP™)

Presented by:
Melanie Franklin, CEO, Maven Training
Polly Murphy, MoP™ Lead Trainer, Maven Training

April 27th at 1.30pm – 5.30pm at the Maven Centre, London

For the April BPUG London regional event Maven Training sponsored a portfolio management workshop.

The participants had a chance to hear about the MoP™ best practice guidance recently published by the Office of Government Commerce (OGC). Go to our MoP Quick Guide for a short slide presentation on the key aspects of MoP™.

Key points included:

• MoP™ includes five principles that deliver the basis for managing projects, programmes and change initiatives as a unit of work, including strategic alignment and senior management commitment
• MoP™ addresses the establishment and the day to day management of the portfolio via two complementary cycles of work:

Portfolio definition cycle, which has five processes including identifying all existing initiatives, categorising them and creating the portfolio plan

Portfolio delivery cycle that has seven processes outlining how the risks, benefits, resources and finances relating to the portfolio will be managed, and how those involved will be governed and communicated with to maintain commitment to successful delivery

• MoP™ includes a number of techniques to support the collation, analysis and prioritisation of multiple projects, programmes and change initiatives including:

Risk Potential Assessment
Delivery Confidence matrix
DICE – Duration, Performance Integrity, Commitment to change, Additional Effort
Analytical Hierarchy Process

Following this overview, the attendees took part in a discussion on how portfolio management is being applied by organisations, which covered a number of topics including:

Context

We examined how the financial crisis of the last couple of years had forced many organisations to identify their total spend on projects and programmes of change in an effort to better map their ambitions to their available resources. This has pushed many organisations into creating an organisation wide picture of the initiatives already underway and/or planned.

This initiated a discussion on the criteria for deciding which projects should be included in this list and the practical difficulties of developing this initial list including:

Many projects are initiated bottom up by individual departments and business units, with the funding coming from departmental budgets rather than a central pool, so those sponsoring the projects are not motivated to provide information to a central collection pool.  Deciding what information to ask for, as many of those working on these initiatives do not understand the precise definitions that we use for categorizing projects and programmes, so we need to be clear about the type of work we are asking for details about.

Establishing criteria to ensure we are sent the right information - do we set a floor limit for the cost or number of resources involved, or do we collect data about everything with the risk that this provides too much data? If we do set a floor limit then we need to decide what is an appropriate level? If we set the level too high we will fail to understand the volume of initiatives Being undertaken which could add up to a significant expenditure in terms of cash and resources.

Strategic alignment

Our discussion included the position of portfolio management as a strategic planning tool, and how this impacts those already working in project and Programme management who are too often seen as working on optional activities that are not core to the business.

Portfolio management is the mechanism for delivering the strategic plan so it makes sense to work alongside those responsible for creating the strategic objectives and key performance indicators that the organisation is pledging to deliver.

It was recognised that portfolio management offers an opportunity to re-position project and programme management as the way in which these objectives are achieved but that this brings PPM professionals into closer alignment with the business. Whilst we all recognised that this was important we also saw the dangers in moving into a space already occupied by business and strategic planning functions and the need for close cooperation between portfolio managers and these functions.

Conclusion

We finished the afternoon by identifying what is driving the demand for portfolio management and how we would pitch the need for portfolio management to a new CEO. The most popular explanation for adopting portfolio management was ‘as a delivery mechanism for the strategic objectives’ which neatly placed portfolio management as a contribution to the business effort rather than as an analysis mechanism which oversees but does not contribute to getting things done.