Page 163 - Global Project Management Handbook

PROGRAM MANAGEMENT AND PROJECT PORTFOLIO MANAGEMENT 7-13

PROJECT PORTFOLIO MANAGEMENT: OVERVIEW

The general objective of project portfolio management is optimization of project portfolio
results. From the project-oriented company’s point of view, the goal is not optimization
of the results of individual projects or programs but rather optimization of the results of
the project portfolio. This objective can conflict with optimization of the objectives of
individual projects.
Different objectives are pursued in the various business processes of project portfolio
management. The central objectives of assigning a project or a program are selection of a
favorable investment and definition of an adequate organizational form for initializing the
investment. The objectives of project portfolio coordination are coordination of the objec-
tives of the projects of the portfolio, coordination of the internal and external resources
used in these projects, organization of learning from and between the projects, and deter-
mination of the projects’ priorities. The objective of project networking is the creation of
synergies between the projects of a network of projects.
The assigning of a project or a program, the coordination of a project portfolio, and
the networking of projects are business processes for project portfolio management. The
managing of a chain of projects is to be seen as a specific form of project networking.
The assigning of a project or a program is to be seen as a business process for project
portfolio management because a decision to start a new project or program ought not to
be taken in isolation but rather in the context of the newly created project portfolio.
The methods for the different business processes of project portfolio management are
listed in Table 7.2 and are described in the following.
The tasks involved in integrating projects and programs in project portfolios, net-
works, and chains are fulfilled by specific, permanent organizational units of the project-
oriented organization, that is, the project portfolio group, the PM office, and expert pools
(see Chapter 18).

TABLE 7.2 Methods of Project Portfolio Management

Methods for assigning a project or a program
• Investment proposal Must

• Investment portfolio score card Can
• Business case analysis or cost-benefit analysis Must
• Project definition Must
• Project proposal Must
• Project assignment Must
Methods of project portfolio coordination
• Project portfolio database Must
• Project portfolio score card Must
• Other project portfolio reports Can
• Project proposals Must
• Project progress reports Must
Methods for networking of projects
• Networking workshop Can
• Network of projects graphics Can
• Project portfolio reports Can
• Project progress reports Can