Many organizations today are in the midst of initiatives that are impacted by the availability of people, money, and resources, as well as existing portfolios, planning processes, and work delivery methods. Project portfolio management (PPM) solutions help companies ensure they have the right capabilities to deliver the projects and programs that make a bigger strategic impact and drive faster time-to-market.
2019 Gartner Magic Quadrant for Project and Portfolio Management
Gartner has named Planview a Leader in the May 2019 Gartner “Magic Quadrant for Project and Portfolio Management,” positioned highest for its ability to execute and furthest for completeness of vision for the second consecutive year.Get the Report: 2019 Gartner Magic Quadrant for Project and Portfolio Management
Even though there is a need for solutions that help manage and coordinate delivery of projects and portfolios, many organizations are not fully taking advantage of the benefits that PPM can bring. According to the Project Management Institute (PMI):
- Too much money is being wasted on poor project performance
- The essential importance of project management as the driver of an organization’s strategy isn’t usually fully realized; only 58% of organizations fully understand the value of project management
- Without good project management, organizations are putting delivery of strategy at risk
Project portfolio management isn’t just about managing a project lifecycle, but rather a best practice is for it to help organizations prioritize the projects and programs that hold the most potential value for the enterprise and maximize that value by ensuring that delivery of the work is driving toward objectives of the company strategy.
In a research note for Critical Capabilities for Project Portfolio Management, Gartner notes that program and portfolio management leaders often find that, given the complexity of their organizations’ project, program, resource and portfolio environments, they need software solutions to plan, organize, and control all of this. PPM tools can often address these needs by providing interrelated functions supporting the series of activities in the lifecycle, from prioritization of resource allocations, through the planning and tracking of major projects, to handling follow-on tasks and releases that address users’ continuous requirements.
Using PPM Capabilities to Full Potential
As organizations seek to mature their project and portfolio management practices, impacts will likely arise as the business environment becomes more and more complex and companies seek to deliver the most innovative products, services, and customer experiences in the market (and faster than ever).
Companies are taking on more initiatives to stay competitive in the market and are seeking solutions to address:
- Technology advancements
- The changing world of work across functions
- The need for innovation
- The need to view delivery of strategy with a more enterprise-wide, product-centric viewpoint
In many cases, managing funding, diversity of skillsets and roles, incoming demand, capacity, utilization, and other factors can mean the difference between the PMO’s success and failure.
Here’s a look at three fundamental capabilities to help your organization make the most of project portfolio management software and best practices to set the foundation for your PMO’s success.
Leverage demand management to prioritize the most valuable work
New work is continuously launched within organizations, and the ability to manage incoming demand for planned and unplanned projects is vital to ensuring the success of projects. Streamlining the demand management process can help accelerate the delivery of work by facilitating the ability to plan ahead and balancing current in-flight work with what is to come.
The benefits that come from agility applied to demand management support the entire downstream of work and prioritization, which in turn ensures faster delivery and means the most innovative products and services go to market.
Demand management isn’t typically the most optimized process and can certainly slow down an organization if it’s not well established and agreed upon. According to consulting firm The Hackett Group:
“IT leaders are challenged to assess and vet, prioritize, and schedule projects at the front end of the portfolio funnel. While some have a strong vetting process, the reality is most IT organizations can’t say no to project requests, which perpetuates a cycle of overwhelming demand and under-performing delivery.”
PPM demand management solutions can enable users to request new projects and manage any changes in project status that could impact workload. These tools capture demand and capacity constraints to ensure that a company’s people and resources are working on things that matter most by aligning to corporate goals and objectives. They give managers a better handle on the pipeline of work by capturing requests and new demand intake directly into a centralized location. By scoring and analyzing the value of requests with what-if scenarios, they can prioritize, approve, and schedule work that aligns with strategic goals.
Real-world demand management
A company that develops, manufactures, and sells optical lenses had inaccurate portfolio planning and a lack of visibility into resources. Typically, the PMO manages a $20 million portfolio of programs and projects as well as another $10 million in unplanned projects. This inevitably disrupts resource balance and portfolio planning.
The company was using spreadsheets to manage 150 team members and all of their projects, along with a homegrown project management tool that was labor-intensive and lacked integral functionality. Project managers often couldn’t even consider assigning and working on innovative new projects because the resources didn’t exist to support them.
By deploying a solution that supports demand management, the company realized benefits including:
- Immediate visibility into resource capacity, project demand, and project status
- Ability to perform “what-if” scenarios, particularly with unplanned projects
- Elimination of subjective reporting and error-prone spreadsheets
Use resource management and capacity planning to optimize work delivery with the right people
When juggling multiple projects that require specific expertise and experience, organizations benefit from having the ability to track of employees’ skills and capacities and apply that information to project timelines and budgets. PPM helps ensure that the right people are working on the right work at the right time.
As Gartner has noted, organizations are faced with issues such as how to manage:
- Ever-increasing demand for new, and often dissimilar, investments with finite resources
- Teams pulled in multiple directions by a rapidly changing technology landscape
- Portfolios with different administrative methods and investment types
The best resource management solutions should be dynamic and flexible to take into consideration the new ways that work is being done across the organization as well as how teams, departments, and roles are organized. In order to accelerate delivery, an enterprise-wide shift is happening within companies around how they view people and resources, from traditional project-based teams toward embracing dedicated teams, or even hybrid models with dynamic teams. Resource managers need to be able to forecast easily and accurately with insight into the work that needs to be done.
Capacity planning is a capability within PPM that goes hand-in-hand with knowing what resources will be needed in the future and planning accordingly. It lets managers know where resources are likely to be over- or under-allocated.
In any fast-moving organization, there is constant demand and new requests can create sudden influxes of work. Sometimes projects and initiatives are spun up quickly without regard for other activities underway or whether there are enough people to handle the work, not to mention whether the work will deliver and align to company strategy.
As a result, work in the pipeline may fall behind schedule and market opportunities might be missed, with negative outcomes like:
- Customers and the market not getting what they want
- Frustration on the part of business leadership
- Team members left feeling overworked and without a sense of direction
Some PPM solutions have the ability to forecast potential skill shortages, enabling managers to take necessary action proactively. Automated resource optimization algorithms can help create what-if scenarios for managers to compare options that will deliver the best-optimized plan for work and resources, combined.
Real-world resource management and capacity planning
A health insurer was dealing with not having visibility around the availability or what project teams were working on – where they were spending their time and why. Team members were assigned to projects haphazardly without regard to how much work they could reasonably accomplish or how delays were affecting estimates. After deploying a PPM solution, managers could see what people were working on, so they could understand within a project perspective where workers were spending their time and in what phases. Resource managers were able to forecast better, so their teams could deliver the work.
Another company, a provider of global electronics manufacturing services, was managing work that involved over 2,400 people within teams, across 40 design centers in 16 countries, with a variety of labor cost rates. Their PPM solution delivers resource utilization analysis information and project health data through weekly reports and dashboards. It helps inform management decisions about the business resources and finance, giving managers insight into where their money and resources are at all times and which investments have the highest rate of return.
The electronics manufacturing services company is also applying PPM to capacity planning, giving business leaders the ability to plan ahead and determine where additional resources might be needed or whether existing resources can be reallocated based on priorities.
Since deploying the solution, the company has data across 1,000 projects and 2,000 to 3,000 team members. Executives rely on their dashboards to make informed decisions and predictions about resources.
Get the visibility you need to make the best resource decisions with time-tracking capabilities
Organizations are embracing different ways of working across the business. In order to ensure strategic alignment is maintained, there is an ever-increasing need to understand what work team members are spending their time on, no matter how that work is delivered.
Time-tracking capabilities can be used by PMOs to gather reported time against multiple tasks on numerous projects, as well as non-project time and activities. Effective time tracking enables the PMO to drive capacity planning and resource management as well as track project financials, which in turn increases efficiency across both portfolio projects and unstructured work.
Capturing resource time is vital when organizations have:
- Contract labor, to assess billed hours
- Financial labor reporting and capitalization, especially where Sarbanes-Oxley or other regulatory oversight is present
- Executives who need to know how resources are spending time on strategic vs. run-the-business projects
- The need to track project costs more accurately
- The need to improve estimating by looking at past trends
By leveraging time-tracking capabilities on mobile devices in a user-friendly context, time tracking adoption becomes a more pragmatic part of the team member’s responsibility.
Real-world time tracking
A major public university and research institution is using PPM to track time to support compliance and resource management and gain a comprehensive view of costs around maintenance, unplanned, and strategic projects within the IT department. The university tracks time based on its IT spending, always aware of how much time is being spent on what types of efforts.
At a time when many enterprises are struggling to get more accomplished with fewer resources, PPM solutions can help them make the most efficient use of the capabilities they have to ensure the successful delivery of projects and programs.