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when a business manages many projects it is critical to keep track of its project portfolio this assists the organization in categorizing initiatives and ensuring that they are aligned with the organization's goals the project portfolio is a word that refers to an organization's collection of projects as well as the process of selecting and managing them the project portfolio is carefully chosen to help the company achieve its objectives so let's talk about the project portfolio today hello everyone this is george from invensis learning welcome to our youtube channel click on the bell icon to get regular updates let us now look into the agenda first we shall discuss what is project portfolio soon after that we shall talk about what is project portfolio management then we shall see the difference between project portfolio management and project management later we shall talk about few project portfolio management ppm key terms then we shall look into the reason for why project portfolio management is important next we shall discuss project portfolio management process and end the discussion by talking project portfolio tools and techniques sounds interesting right now we shall begin the session by knowing what is a project project portfolio is a collection of projects programs and procedures that are managed and optimized together for an organization's financial and strategic goals at the functional or organizational level a portfolio can be managed unlike a project with a clear and objective or deliverable a portfolio is a more strategic commitment to continuously optimize resource allocation prioritizing and scheduling across multiple initiatives companies will generally have considerably more project opportunities than financing can support therefore the selection process must select a subset of projects that will optimize the company's profit goals while staying within budgetary constraints at the same time executives want to keep an eye on the portfolio's total risk while ensuring that cash flow and other essentials are not jeopardized projects are categorized into programs ing to their significance and similarity those programs and associated projects should be included in a portfolio strategy developed by the project management office tmo to accomplish overall company objectives a project portfolio does more than just connect projects with corporate strategy it also allows an organization's project management style including all project policies and processes to be aligned with its objectives now that you guys are aware of the term project portfolio let us understand what is project portfolio management the study and optimization of costs resources technology and processes for all projects and programs within a portfolio are known as project portfolio management ppm portfolio managers or a project management office are usually in charge of project portfolio management pmo in simple terms the centralized management of one or more project portfolios to fulfill strategic objectives is called project portfolio management it's a method of bridging the gap between strategy and execution ensuring that an organization's project selection and execution are successful here are a few examples of ppm's applications a project is a short-term activity with a set start end date scope and resources to plan resource and manage work organizations frequently employ a portfolio which is a collection of projects the centralized management of one or more project portfolios to meet strategic objectives is what project portfolio management entails budgets resources and deliverables are frequently linked amongst projects therefore project portfolio management considers all projects across all divisions rather than managing individual projects ppm guarantees that all approved and continuing projects are managed to achieve agreed upon goals and provide outcomes it's all about completing the appropriate projects at the right time in a consistent manner the core of ppm is strategy which is a plan for the organization's future the plan lays forth the objectives and measures that will be followed to achieve the new intended condition to achieve these objectives you'll need to manage your resources respond quickly to opportunities and improve performance organizations can forecast project results and control risks by answering these questions a portfolio unlike a project does not have a beginning or endpoint instead completed projects are replaced with new ones an organization can have a single overall portfolio or multiple portfolios for different business sectors such as it or marketing ppm improves insight into progress and brings historical performance data to the surface this data enables senior management to make informed decisions ppm's main purpose is to ensure that all of the portfolio's outcomes contribute to the organization's strategic goals and business objectives the portfolio manager often known as the pmo accomplishes this by conducting business analysis evaluating budgets and forecasting while limiting risk and managing stakeholder expectations after understanding project portfolio management we shall discuss project portfolio management vs project management although both are similar sounding names project and portfolio management require some general skills to understand the differences between project portfolio and project management we must first define each and investigate the areas where they differ simply said project management is the management of a project a project is a short-term undertaking that produces a product or service it has a start and a finish the project's objectives are specified and tasks are organized into a timeline budgets and costs are established resources are allotted and stakeholders are informed as you may know project management applies information skills tools and strategies to project activities to fulfill project objectives its significance cannot be overstated project portfolio management on the other hand is a higher level method that orchestrates prioritizes and analyzes the potential value of a portfolio's various projects and programs in order to manage them all at the same time while maximizing resource management the portfolio management process aims to manage and use the life cycle of investments initiatives programs projects and outcomes in order best to achieve an organization's overall goals and objectives in simple words it is the link between project management and enterprise management which is responsible for the organization's overarching vision mission and strategic planning project portfolio management starts with selecting project ideas then an assessment of their feasibility and contribution to strategic business goals as well as a review of the entire project landscape as a result one significant variation is the number of projects involved project portfolio management is a method that project managers and project management offices pmos use to assess a project's financial potential it enables businesses and executives to see the larger picture ppm is not primarily concerned with project management rather it is concerned with determining which projects to participate in and how to fund them based on whether or not they support the company's goals and objectives projects that do not fit within the company's goals are eliminated from consideration suppose you were in charge of a technology company's portfolio in that case you'd probably turn down a proposed construction project because it doesn't fit the company's stated goal of focusing on a specific type of technological project project management as a result is a subset of project portfolio management it leads to the ultimate goal of achieving the organization's strategic goals project management is concerned with the real progress from inception to conclusion therefore project and portfolio management are incalculably valuable to an organization when used together now that you have understood the differences between project and project portfolio management let us discuss some of the project portfolio management key terms project portfolio management ppm is a method used by project managers and project management organizations pmos to assess the possibility of a project success project portfolio managers provide forecasting and business analysis for companies intending to invest in new projects by organizing and combining all data related to proposed and current projects as a result organizations and managers can see the full picture using project portfolio management first we have portfolio a portfolio is a collection of programs projects and other pieces of work that are all aligned with strategic goals and objectives next portfolio management portfolio management is the process of overseeing a project portfolio to ensure that it is aligned with an organization's broader strategic goals and objectives then portfolio balancing once the components have been prioritized they can be organized into a component mix that will help achieve strategic objectives next we have executives know who to contact in terms of project managers the next is program management managing a portfolio of projects with the same goal as portfolio management but with the exception that the projects in the portfolio are all connected or comparable coming to the next one we have benefit a benefit is an outcome of an initiative that is considered to be useful next project managers access to team members is easy for project managers then team members better connection with the leadership and other teams next we have stakeholders kept informed with continuous and credible comments then project management from start to completion project management entails planning executing monitoring and reporting on a single project as well as controlling scope expenses and schedule coming to the next we have business case a essential document prepared early in the project's life cycle that explains the project's execution based on numerous key elements such as estimated costs probable risks and expected rewards next in our list we have pmo the project management office pmo is a group entrusted with maintaining project management standards within the organization and it frequently oversells portfolio and program management the next term is benefits realization management the practice of properly managing change initiatives and projects to achieve desired outcomes next we have change control management ccm it is a process for detecting and responding to change in a project or portfolio next category a description for grouping possible and validated portfolio components to aid in decision making components are typically tied to a shared set of strategic goals 10. portfolio reporting creating charts graphs and other reporting documentation to communicate portfolio metrics and progress next key performance indicators kpis are a set of metrics that can be used to measure and report on the performance of a portfolio or one of its components risk management it is the process of identifying and resolving risk both before and after it occurs the next key term is deliverables it is a physical item or measurable outputs that are identified as part of the project's product or objectives next we have resource management the process of distributing resources throughout the portfolio's lifecycle is known as resource management pipeline management making estimates and decisions about which projects to fund that are in line with an organization strategy value proposition a one-page document that details the benefits of a possible project sometimes known as a simplified business case it is frequently utilized at the project's very early screening stage next financial management recognizing the particular risks associated with each project and applying this information to portfolio-wide decisions capacity capacity refers to all of an organization's resources for portfolio management including human resources financial assets and physical assets then selection the process of selecting components for inclusion in the portfolio based on their evaluation scores next scoring model a scoring model is a method of calculating and rating components using weighted criteria and key indicators lastly steering committee a group of stakeholders charged with giving strategic direction for the portfolio and then monitoring it throughout the year all of these considerations as well as others demonstrate the importance of project portfolio management after getting to know a few of the basic project portfolio terms let us see why is project portfolio management important once the strategy has been decided upon organizations use projects to deliver on essential requirements and milestones choosing the right project is critical to long-term success every accepted initiative must contribute to larger goals and give value project portfolio management can help organizations answer questions like are we making wise project decisions is it accurate to say that we're working on the right projects what should our teams concentrate on instead what are the current project statuses what can we do to improve our resource management is it feasible to work on multiple projects at once is there anything similar in the projects that the teams are working on will our projects be able to meet critical strategic goals portfolio management is a technique to bridge the gap between strategy and implementation ing to the project management institute the portfolio manager's role is to make sure that the right projects are completed at the right time in order to optimize the company's investment this is especially critical in a company with a lot of internal projects project ideas can emerge from anywhere at any moment and it's not uncommon for a company to have a big list of future projects to work on however there is rarely enough time money or resources to complete them all at once therefore portfolio management must determine which projects will have the greatest positive influence on the business and prioritize them appropriately by describing how the business controls project ranking resource distribution planning development and other critical parts the correct project portfolio management strategy keeps projects aligned with strategic corporate goals in a well-organized efficient manner project portfolio management aims to eliminate inefficiencies when working on a project and potential dangers that can arise due to a lack of information or systems it assists the organization and aligning its project activities to satisfy the project's requirements while maximizing resource utilization as a result every one of the organization's project managers must be aware of organizational project portfolio management in order to contribute to the organization's goals when executing their projects project portfolio management ensures that projects have a set of goals that when met produce the desired outcomes furthermore ppm can be utilized to bring about changes in the organization resulting in a more flexible structure in terms of project execution in this way the organization will not be threatened by the change effective project portfolio management provides the following advantages greater flexibility in the face of change integrates project management with governance and oversight a higher return is achieved by constant assessment and thorough monitoring it ensures that the company's goals and projects are in sync the management's viewpoint on project portfolio management is viewed as an effort toward a higher return as a result this will not be regarded a work related element it is easier to identify dependencies as a result some inefficiencies will be avoided enables the project management office or portfolio manager to reject projects that aren't in line with the company's goals competitive edge over other businesses competitive advantage removes personal bias from project planning ensuring that no pet projects are created rather than focusing on the project itself it allows you to concentrate on the tactics that will help you reach your goals makes it easier to make decisions in the face of project conflicts it's responsibilities are concentrated in one business area rather than dispersed across numerous both it and business projects contribute to achieving the organization's goals it underlines the significance of taking a long-term big-picture approach now we shall look into the project portfolio management process with a 3.2 billion dollar market for project portfolio management solutions expected in 2021 it's apparent that many agile teams are embracing ppm in their enterprises however these five steps are essential for successful centralized management regardless of which ppm platform you use define business objectives you'll need to know your company's business objectives and strategic goals before you can start thinking about portfolio management the idea is that your project portfolio will connect with your company's strategic planning so you'll need to see if its financial goals and consumer value are appropriate for your company as a project portfolio manager you'll need to work with stakeholders to agree on the project portfolio strategic goals and setup valuation criteria for project selection identifying organizational goals and clearly defining a business plan to accomplish those goals should be the first step toward effective ppm companies will be able to build an action plan as a result of this each project in a portfolio should align with the company's strategic goals when companies define their corporate strategies but lose sight of individual initiatives they fall into a typical trap to avoid this businesses should take the time to define their business strategy and assess where their initiatives stand regarding their goals teams must be on the same page in order to choose initiatives that will benefit your company one of the most common methods for achieving this is to build a strategy map that describes the business objectives and how team members should prioritize them this entails compiling a list of all current projects and resources evaluating current projects in the pipeline for redundancies stalled projects and other cost-cutting opportunities and identifying skilled employees and their current and future availability to determine who is available work on high-value projects establish a project prioritizing methodology after that next decide what actions you'll take to see if a project is a good fit for your objectives some businesses for example may utilize a scoring model in which they assign numerical scores to projects in important categories until they reach the highest averages others may simply analyze the costs and benefits of each project in light of the company's overall goals gather information and research potential initiatives make a list of prospective project ideas and do some research on them for example ideas from co-workers client feedback or specific regulatory requirements could all be sources of inspiration then put some high level information on those concepts together such as probable resource requirements take inventory of your current projects as well as projects you've been considering to begin optimizing your project portfolio keep track of project statuses categories and other details that will help you determine how relevant each project is to your business objectives you may also estimate how much time and money each project will take to complete this estimate can also assist you in determining costs and feasibility allowing you to manage resources properly ideas for projects can come from everywhere and at any moment so it's critical to have a systematic intake procedure to gather these ideas and track and assess them this might be as simple as a portfolio manager's spreadsheet or it could be an online database that anybody in the firm can access examine your portfolio of projects after you finish generating your list you may start evaluating projects using your project prioritizing process don't forget to think about practicality while evaluating if each project is useful to your company it's a no-go for your team if a project isn't doable you should have a list of projects that are aligned with your goals and deliver the most value to your company by the end of your evaluation your portfolio should ideally comprise a mix of tasks that help you achieve both short and long-term goals this way you'll be able to secure the returns you need to maintain your present growth rate while also making room for future innovation that will lead to exponential development the portfolio of initiatives must then be validated against their feasibility and available resources expand on the high-level data already gathered to paint a more realistic picture of the resources required to execute a project and any potential roadblocks you can invest resources and proceed forward if the project still appears realistic it's time to conduct a feasibility analysis that considers the projects that are the best fit for your portfolio it's critical to validate the portfolio as a whole after a decision has been made on which projects to pursue this may entail ensuring that the project mix chosen is not excessively large dangerous expensive or interconnected the portfolio should be well balanced and linked with the company's objectives this is an issue if three of your projects forecast testing in january and you only have one test lab also if two projects are interconnected and a delay in one will cause a delay in the other you might want to contemplate starting them both at the same time project managers can be assigned and projects can begin once the portfolio has been validated allocate resources that are available begin resource allocation as soon as you've narrowed down the number of projects you wish to take on then distribute your budget team members and other resources among your top priorities you'll also need to make a timeline for your project portfolio which includes the deadlines for each project you may also add major milestones to your timelines to make them more descriptive risk management is also an important aspect of this process if you find that you don't have enough resources to execute all of the projects you've chosen rethink your priorities until you've built a portfolio that doesn't overwork your team tracking your projects throughout their life cycles is important for project portfolio management as you begin to execute the projects you selected keep a tight check on your performance including your roi project failure rate and other kpis if your project portfolio isn't performing as well as you'd like you may alter your resource allocation in real time rather than waiting until it's too late tracking key metrics can also aid in the continuous improvement of your ppm process if your project prioritization methods for example aren't assisting you in meeting your financial objectives consider brainstorming more effective approaches to analyze each of your projects manage and monitor the portfolio you and your team will need to manage projects once they start keeping an eye on performance and recalibrating as needed this could entail things like re-scoping reallocating resources and examining the portfolio as a whole regularly working alongside project and program managers you'll now need to coordinate the execution of all of the projects and programs in your portfolio simultaneously over time projects alter and evolve and new ideas may be added to the list of possible projects this is why it's critical to keep track of both the portfolio execution and the intake process at all times the following are some examples of portfolio management and monitoring working with project managers to keep track of project progress identifying and resolving inter project disputes making portfolio modifications as needed such as putting projects on hold terminating projects and adding new projects assuring that projects are still aligned with the company's goals now let us move into our next topic that is project portfolio tools and techniques a robust ppm tool with an intuitive user interface offers a quick way to evaluate these questions and more not only does the correct ppm solution provide you with visibility into every detail of your portfolio as a whole but it also supports and enhances the people and processes involved it achieves this by integrating project selection with your organization's budgeting processes ensuring that initiatives align with priorities support fiscal budgets and are feasible with the personnel available project portfolio management can be done with a variety of tools the following are the key characteristics of those tools an approach for evaluating projects that is systematic it is necessary to plan resources it is necessary to keep costs and benefits on track a cost-benefit analysis is being carried out from time to time you'll receive progress reports information is available when and where it is needed the relevant information will be passed through a communication mechanism though there are numerous project portfolio management systems available the following are the most effective at the enterprise level accommodate project portfolio management provide user-friendly interfaces and features enhance online collaboration and communication capabilities for remote workers reporting and analytics that are comprehensive techniques used to measure ppm various strategies are used to measure or support the ppm process regularly there are many sorts of procedures that are widely employed however a model with heuristics technique for calculating points techniques that are visual or map-based the application of such strategies should consider the project and organizational objectives and resource skills and project management infrastructure ppm software must have the following attributes and functions planning for the future opportunity management capital planning creating a project management of resources reporting and portfolio analysis automated workflows and stage gates these functions data provides you with real-time objective insights into what's going on across projects it enables you to make educated decisions by analyzing what if scenarios such as what would happen if a specific project were to be cancelled what impact would a three-week delay in this project have on resources for a different project what impact would share a resource between projects have how will the 10 increase in the budget this year affect the roadmap for next year now we have come to an end by now you guys would have understood that project portfolio management is a great tool that can assist your agile team in making decisions that are based on the broad picture instead of focusing solely on individual projects the ppm method allows you to eliminate bottlenecks and larger workflows and utilize resources across an entire portfolio in this manner you can stay on track to achieve your business objectives the large picture of course isn't everything you must zoom in on the details now and then to be a well-rounded agile team you may gain additional perspective on your projects with easy agile programs allowing you to continue maximizing your organization's growth to know more about project portfolio management you can take up project related courses from us we at invensis learning will provide you with a course with rich domain experience for more details check out the description below also if you guys have any doubts please drop them in the comments section thank you you