Making decisions concerning projects: How to facilitate decision-making in project portfolio management

Decisions concerning projects are THE key decisions in project portfolio management. Many companies have difficulty finding a balance between increasingly long lists of new projects, ongoing projects and insufficient financing capacity. What project should be launched? More specifically, which projects should be integrated into the project portfolio? How should projects be prioritised in relation to each other? Without giving away too much, project decision-making will above all be a decision not to go ahead with projects. The projects office or the PMO registers more requests than their company is able to complete. Resources are in shorter supply than ideas…

Therefore, we want to make the best decision concerning the allocation of resources to complete projects. It should be noted that project request management is very often mentioned by our customers as the process which has drastically improved through using the PPM platform.

CONTENTS:

How do I set up project portfolio management?

Project portfolio management requires different skills to project management. Project portfolio management requires strategy management and risk management skills. In order to know, understand and monitor the projects in a company, project portfolio management aims to identify and assess each project in order to subsequently give them each a priority. When it comes to project decision-making and prioritisation, how do you make the right choices to make decisions about the projects in the portfolio? Project portfolio management must be part of a strategy to ask what the reasons are to start a project, put on the brakes or stop it.

What tool should I use to facilitate decision-making in project portfolio management?

A standard Project Portfolio Management tool brings together several decision keys: the bubble chart. It highlights the key issues and the resources to be mobilised. It can also be used to easily compare projects with each other. This graph with three axes (x-axis, y-axis and bubble size) puts the project portfolio and candidate projects into visual form.

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project portfolio management software tool like Project Monitor can be used to automatically construct a graph and change the themes analysed (budget, finance, risk, value, deadline, etc.). It is also a very useful tool to make decisions about projects and group together ongoing projects and project requests.

There is a great deal of data which should inform your decisions about projects, both concerning the existing situation of your portfolio and the prospective data on project requests.

This data is crucial and uncertainties about each aspect may, when taken all together, make your decisions very random.

This is the goal of a PPM (Project Portfolio Management) tool:

Project portfolio management software demo

Make decisions about your projects easily in three steps in a project portfolio tool

1. Define the key indicators for managing your project portfolios (risk, resources, schedule and budget)

2. Manage your portfolios using customised dashboards

3. Coordinate governance meetings in collaborative mode using interactive reports and web slideshows

During your project reviews, you must always be able to track the progress of various monitoring indicators – schedule, budget and resources – using pertinent evaluation tools. Project Monitor allows you to see the context of your projects in PPM dashboards with hard-hitting data: weather, warnings and action plans in progress.

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When making decisions about project portfolio management, what information would be useful to know?

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1. Project requests management: Identify the issues to be resolved

The project challenge: Why is this request up for decision in project portfolio management? The descriptions of “why” and of the goal should take precedence over the way in which to respond. Express a need rather than a “project product” response. The answer may differ quite considerably from what you had initially considered. The submission of a request must allow several project responses.

The purpose of the project will also clarify the usefulness of carrying out a project. A few questions to ask yourself:

“Scoring” grilles can be used to make these criteria objective and thus enable prioritisation according to the “challenge” focus. The MAREVA method provides a guideline to analyse the value of a digital project and thus position projects relative to each other.

The simple fact of asking yourself questions is already very positive. It will make it possible to get out of the “ask/do” cognitive rut which is often biased by the “current” effect, the “authority” effect and the “decibel” effect.

Project requests, a key function in a PPM software solution to channel the portfolio flow

Project Monitor enables you to define project sheets or personalised request sheets according to your needs. You can create all the analysis and prioritisation criteria you need: strategic interest, risk level, ROI, etc.

Each requesting party updates their project before the prioritisation meeting. Updates can be monitored in real-time according to user rights.

Depending on the maturity and size of your organisation and your processes, candidate projects can follow a validation process managed by a workflow.

Our Project Monitor solution enables the creation of personalised forms to describe your project requests and formalise their challenges:

2. Make decisions about the projects bearing in mind the balance of the project portfolio

The balance of the project portfolio is measured on its pillars:

Decision-making must ensure the projects are distributed uniformly. For example: are there enough projects contributing to the sustainable development strategic focus or are there too many? In the case of territorial impact, the issue of the proportionality of project investments from a geographical point of view can also be considered.

3. Decision-making at project level AND project portfolio level

Like an industrial customer, you can also look at the time aspect. This does not mean time measuring the duration of the project but rather the expected impacts of the project:

This reading grille aims to ensure that you prepare for the future. If you have no projects with a long-term benefit in your portfolio, this is a sign of danger. Short-term pressure tends to endlessly push back decisions which will prepare for the future. Long-term projects are those which will create the value of tomorrow. Depending on the activity sectors, innovation and investment are just as crucial as optimisation.

How to make decisions about projects: inform project decision-making in terms of cost and impact

1. Consider the impact of the project according to the level of risk

Here is an initial list of questions to “rough out” the decision and which need to be specified in more detail in case of a favourable decision:

These risk analysis grilles depend on the sector of activity. An approach based on a list of questions is an effective practice. A scoring system can be combined with this approach. Relative project risk scoring is more useful than absolute scoring. This includes comparing projects two by two. Which of the two is riskier? Enriching the risk questioning grilles with project feedback is a useful practice. Finally, in case of doubt, getting an outside opinion about a project is useful, in particular, to consider the benefits of the project.

2. Analyse the feasibility of projects

The arrangements for carrying out the project are the second focus. This is the project feasibility focus. From the point of view of the “project management triangle”, this is the analysis of the “cost/time” peaks.

In practice, this means:

3. Prioritise projects according to budgets

Project decision-making will also be based on economic criteria. Project budgets are not elastic, even if the added value may help to finance unplanned projects. Therefore, choices need to be made (and consequently projects that are too expensive will need to be dropped). Financial information in the prioritisation process will depend on the culture and activity of the structure. For example, in IT and “building” type departments, projects are at the heart of the activity and therefore budgets are built for and around the projects. Project prioritisation will therefore involve two stages:

Budget development is based on an inventory of the upcoming projects, a financial estimate and sometimes several scenarios. The structure or the department will therefore have an initial overall negotiation stage to obtain resources at a project portfolio level. Subsequently, resources will be allocated to the projects. This allocation will be the subject of a second decision on a unit basis and will integrate the progress and financial execution of the projects underway.

This decision-making process taking into account the finances is based on a great deal of data to be structured:

management budgetaire des projets


✔ Prepare your project reviews and view spending for each project

A dashboard offers you a detailed look at each project to understand and analyse the projects underway.
This per-project analysis lets you highlight non-compliant budget situations and quickly identify problems in the current and forecast financial year. Simply open up this project to understand the expenditure items included in this batch.

4. Use the resource workload plan and the ability to perform

If you have processed the elements in the order of the document, you have: a project aligned with the strategy, with identified impacts and possible financing. All that remains is the question of the project team:

Do you have the resources to complete the project? The question is considered from two angles:

The answer in terms of capacity will be all the more accurate if you have established:

Otherwise, you have the “it should be fine” mantra, but that does not give the best guarantee. Project management software gives you calm control of your project resource capacity. Be proactive when planning projects!

Project interdependency: the last key for project prioritisation?

If you still have any doubts at this stage, considering the schedule side will finalise the project decision overview and lead to a project “go/no go”.

A project is never completed in a “bubble”. It is conducted among other projects. If these other projects can come into competition for budgets and resource allocation, they are sometimes direct “predecessors” or “influencers”. This is where the concept of appointment and milestone dependency between projects comes into it.

The decision can therefore be “yes” but not just yet. This postponement will be for reasons of:

“Multi-Gantt” forecasts for the project portfolio will provide interesting information on this subject.

capacity planning

✔ Allocate the right resources at the right time

Project Monitor project portfolio management software enables you to organise your workload plan according to resource capacity for better assignment of recurring activities, management of holidays, and project planning. The Project Monitor resource planning tool offers new-generation automatic scheduling with updates occurring in real-time. This resource management tool constantly alerts you to under-or over-staffing.

All that remains to do now is make decisions about your projects 🙂

We have explored the variables and decision keys for project decision-making. This inventory, therefore, aims to reduce the uncertainty aspect in project prioritisation. It remains a complex process which has something of a gamble about it.

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