Description: Project Portfolio Management (PPM) is the centralized management of the processes, methods, and technologies used by project managers and the PMO to analyze and collectively manage current or proposed projects based on numerous key characteristics. The objectives of PPM are to determine the optimal resource mix for delivery and to schedule activities to best achieve an organization’s operational and financial goals, while honoring constraints imposed by customers, strategic objectives, or external real-world factors.
It provides a framework for issue resolution and risk mitigation, as well as the centralized visibility to help planning and scheduling teams to identify the fastest, cheapest, or most suitable approach to deliver projects and programs. PPM can be broken down into a few different key factors.
- Demand Management
This is the determination of whether (and how) a set of projects in the portfolio can be executed by a company with finite resources in a specified time. Fundamental to demand management is the ability to align the decision-making process for estimating and selecting new capital investment projects with the strategic plan.
- Resource Management
The focus on efficient and effective deployment of an organization’s resources where and when they are needed. These can include financial resources, inventory, human resources, technical skills, production and design.
- Change Control
The capture and prioritization of change requests that can include new requirements, features, functions, operational constraints, regulatory demands, and technical enhancements. PPM provides a central repository for these change requests and the ability to match available resources to evolving demand.
- Financial Management
With PPM, one can improve their accuracy for estimating and managing the financial resources of a project or group of projects. In addition, the value of projects can be demonstrated in relation to the strategic objectives and priorities of the organization through financial controls and to assess progress through earned value and other project financial techniques.
- Risk Management
An analysis of the risk sensitivities residing within each project, as the basis for determining confidence levels across the portfolio. The integration of cost and schedule risk management with techniques for determining contingency and risk response plans, enable organizations to gain an objective view of a project's uncertainties.