Example of implementation of an ISD project portfolio | Interview with the PMO

In this interview, Michel Operto, PMO & PPM expert, recounts his experience. Michel had the opportunity to implement the prioritisation and management of an IT project portfolio. If you are a PMO, Project Manager or CIO, this content will be useful if you undertake a similar adventure! Here are the highlights of this experience implementing an ISD project portfolio.

What’s coming up in this article:

gestion plan actions project monitor

Project portfolio management: what is the difference between project, programme and portfolio?

What were the aims of implementing the project portfolio?

“I had the opportunity (the luck and the privilege, I should add) to implement the prioritisation and management for an IT project portfolio. I am going to talk about the highlights of this experience here, as I think they may be useful to you if you are undertaking an experience that is even the slightest bit similar.

We have four main objectives when creating and implementing the IT Project Portfolio management process. Here they are, together with a few of the specific issues each one raised.

Maximise project return on investment

Align projects with the company’s strategy

Limit the number of projects

Ensure the coherence of the project portfolio

The roles and responsibilities of the main stakeholders in this experience

I will stress here the role of portfolio management, which supplies the data enabling the decision-makers to make their decisions. In my case, the CEO, the IT, Marketing and Sales and Operational Support departments. The portfolio manager does not make the decisions. They act as a facilitator. They facilitate decision-making through the information they provide.

The main steps in implementing the project portfolio

Lay good foundations

To start with, the basis for the work is of course to produce an inventory of the existing situation:

Then establish the project evaluation criteria

This point is particularly crucial, given that the aim is above all to move from a subjective model to a decision model, based on relevant, indisputable facts and information.

So, I have learnt from this personal experience that the criteria must be as follows:

For example, in this precise case, here are the criteria used:

  1. Total amount of the investment: Machines, software, support costs, external services (consultants), resources (internal and subcontractors), travel.
  2. Strategic alignment: Impact on the revenue, impact on the costs, operational efficiency, customer satisfaction.
  3. Return on Investment: “Payback Period” = The time needed to fully recover the investment through the benefits brought by the project.
  4. Likelihood of success: Well-defined, stable needs; ability to absorb the change and re-engineering, process redefinition needs; size of the project; risk of budget or timeframe overruns; risks linked to security.
  5. Technical alignment: Alignment on the technical architecture; no conflicts with the convergence plans; simplicity and modularity; dependencies of other projects on this one; availability of adequate resources; availability and stability of the technology.

Design the crossed priorities grilles

Then we designed simple priority grilles which enable the criteria to be crossed two by two.

In this precise example, the overall investment budget was imposed.

We, therefore, crossed all the other criteria with this one to position each project in the grilles.

Take a step back to estimate the portfolio balance

Make sure you are not misled by the colour codes. You should be aware that a portfolio in which all the projects are in the green may not necessarily be optimal. Indeed, with the settings of this portfolio, the green quadrant only favoured the projects for which the returns on investment were very short-term and the least risky. In business, this strategy rarely pays off in the medium- or long-term.

Try to find three-dimensional visualisation models

Another table which was useful to us is the crossed table of risks and benefits in relation to the level of investment required.

This graph positions the projects in relation to each other according to their benefits and chances of success, whilst at the same time visually representing the investments required to undertake them through the size of the bubbles.

What should you take from this experience for your own project portfolio?

Of course, there are efforts to be made on the part of the portfolio manager and the management to initiate the movement, collect all the data and create the right level of attention among the company’s executive management. They will give impetus to your initiative to implement the project portfolio.

Moreover, the Portfolio Manager will also have to roll up their sleeves to:

The risks you will probably have to tackle

The benefits of implementing the project portfolio

What about the tool? Implement project portfolio management software

How do you find the collaborative tool which will enable you to manage a vast project portfolio?

To do so, review the challenges encountered in your company, whether in the management of project requests, risks, budgets or resource management. The PPM tool is an answer to the business needs and must be facilitating for decision-making in project governance.” 

To take things further… How have they improved their project management? CIOs, PMOs and project managers share their experiences!

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This article was co-written with Michel Operto, an expert on project management, PMO and IT portfolio prioritisation. Michel Operto also writes the specialised project and portfolio management blog https://dantotsupm.com/