What is project portfolio management?

Project Portfolio Management (PPM) is a process of managing the various projects undertaken by a company. PPM is not only limited to managing current projects but also deals with assigning and authorizing new projects. Large business companies have many projects running simultaneously and are constantly looking out for new ideas to capitalize on opportunities; Project Portfolio Management allows a collective oversight over these projects (past, present, and future) and helps in fine-tuning business decisions to maximize the return of investment. If you want to know more about your business and portfolio management, follow Business Architecture and Project Portfolio Management.

Project Management Vs Project Portfolio Management

Both terms – Project Management and Project Portfolio Management – have a difference. Many companies use these terms synonymously but there is a significant contrast; Project Management stands for a single project and its management whereas Project Portfolio Management stands for multiple projects that are running under the company. PPM has a larger scope in businesses, especially large businesses that have many projects. The many projects are undertaken by a company and the upcoming new projects constitute the portfolio of a business company.

Why Project Portfolio Management?

Project Portfolio Management aims to control projects and complete them to drive results. If a company has multiple projects under its authority, there is an equal chance of failure in completing the project, as there is an equal chance of completing it. Project Portfolio Management reduces the chances of failure and increases the completion rate. PPM is an umbrella term that has many other aspects related to the completion of a project and its nuances coming under it.

There are several benefits of PPM

  • Keep everyone involved in an initiative up to date. It creates a space for all the people responsible for carrying out the projects so that they can coordinate and communicate effectively, and share feedback.
  • It provides the stakeholders and the executives with the specifics of and insight into all the current and upcoming projects under the company.
  • It allows focusing on the bigger picture of the business and acts as a blueprint for carrying out the completion of the projects.
  • Eliminates biases and pet projects with the identification of the right investments and right direction for the business company.
  • Accuracy of the project data that allows effective collaboration between various projects that are interlinked or dependent.
  • Higher collaboration between projects and insight into them also creates opportunities to reduce and mitigate risks.
  • Businesses have limited resources; PPM allows optimal use of the available resources to deliver a higher return of investment in projects.

Project Portfolio Management consists of the management of time, resources, demand, projects & programs, finance, and risk. Managing a portfolio requires planning, scheduling, monitoring, and controlling projects because of the available resources and using them optimally to serve the customer demands. Financial planning and time management are key priorities that keep projects on track. Planning of projects also reveals areas that are risk-prone which allows opportunities to mitigate it.