Organizational Capability to Manage Portfolios Programs and Projects
The organization's Executive Management teams are responsible for all aspects of project, program and portfolio management and should ensure the organization develops the capabilities needed to support effective project governance. These are the systems, processes and procedures that deliver effective outcomes and provide assurances to the organizations governing body that the work being undertaken is aligned with the organization's strategy, is being accomplished efficiently and is generating the best value for the organization as a whole.
This facet of Executive Management may be assigned to a "Chief Project Officer" (CPO) and directly supports the governance functions undertaken by the "Board". The management capabilities to be developed, enhanced, and continually improved include:
- Systems to develop and maintain an effective strategic plan for the whole organization and extract the relevant sections that require projects and programs.[5]
- Robust and rigorous opportunity identification and assessment processes.
- Effective project and program support mechanisms including methodologies, staff development, oversight and risk management processes.
- Processes to effectively engage with other parts of the overall organization and generate the maximum value from the selected the project and programs.[6]
- Effective oversight and reporting processes to accurately assess the status of all current projects and programs.
- The framework for this and the "questions" the "governing board" needs to ask, and the organization's Senior Executives needs to be capable of answering effectively, are defined in Directing Change.[7] This Guide to Governance of project management is published by the Association for Project Management (UK).
Portfolio Management
Portfolio management is the Executive Management function that focuses on selecting the right projects and programs (components) for the organization to undertake.[8] The objective is to optimize the implementation of the strategic plan within the organization's current capacity and capability constraints, followed by monitoring and reviewing the on-going work of the selected components. The purpose here is to maximize their value to the organization in the long, medium and shorter term. Components that no longer contribute to value should be terminated to free up resources for more valuable work.
Some of the inputs and processes used in Portfolio management may include:
- The organizations strategic plan and risk tolerance
- Business Cases:[9] To establish the business need for the project
- The organization's capabilities
- The organization's resource constraints (including funding)
- Project/Program selection processes:[10] To determine which projects/programs to start or continue and which to reject or terminate
- Project Charter:[11] Created to formally initiate a project
5. For more
on the processes involved in organizational change management see: www.mosaicprojects.com.au/WhitePapers/WP1078_Change_Management.pdf
6. For more on the processes involved in organizational change
management see: www.mosaicprojects.com.au/WhitePapers/WP1078_Change_Management.pdf
7. To download Directing Change, a guide to governance of project
management:
www.mosaicprojects.com.au/PDF/APM%20GoPM%20booklet.pdf
8. For more on Portfolio Management see: www.mosaicprojects.com.au/WhitePapers/WP1017_Portfolios.pdf
9. For more on Business Cases see: www.mosaicprojects.com.au/WhitePapers/WP1018_Business_Case.pdf
10. For more on "selection" see: www.mosaicprojects.com.au/WhitePapers/WP1062_Ranking-Requirements.pdf
11. For more on the Project Charter see: www.mosaicprojects.com.au/WhitePapers/WP1019_Charter.pdf
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Organizational Governance
