Why Using a Portfolio Approach Makes the Most Sense
An effective project portfolio process starts long before projects are initiated, actively continues during projects, and even continues long after each project is closed. Too many project portfolios function only as pre-project approval processes and stop supporting effective project resource decision-making after each approved project actually begins.
Imagine if your own stock portfolio only functioned to help you pick which stocks to buy, and then stopped guiding your on-going buy-sell choices, while some of your newly purchased stock picks plummeted in value! Effective project portfolios help organizations - plan and approve future projects, allocate/reallocate resources, manage active projects collectively and hopefully synergistically, and provide closed-project repositories and historical data about project and portfolio performance over last few years
Project Success is Great – Portfolio Optimization is Actually Better!
Only defining single project success criteria without measuring a project’s impact on other projects is short-sighted for organizations. A single project can meet its goals of on-time and on-budget yet wreak havoc on shared resources with other projects - all in the name of achieving one project’s success. Conversely, one project can “take a bullet for the team” and miss its goals by surrendering some of its critical resources to support other important organizational projects to be successful.
Finally, an organization cannot make optimal resource allocation and reallocation decisions without seeing all of the impacts of each resource reallocation decision on all of the other organizational activities and/or projects affected. Effective project portfolios should support a monthly organizational reassessment of all project resource commitments - to help ensure that these commitments still represent the best use of available resources.
Look Out for Those “Undocumented” Project Icebergs
Documented (and undocumented) projects and activities in each organization can vary significantly in their mission, duration, type, size, complexity, difficulty, and even behavior. When diverse organization projects and activities rely on commonly shared human, financial, technological, logistical, and even sponsorship resource pools, then there is significant potential for cross-project and cross-effort impact both positive and negative.
To try to manage project resource risks more effectively for all organization projects and activities that share important resources – one project management size does not fit all – but one project portfolio size could and probably should fit all! How do you view your projects and portfolios?.