The practice of Project Portfolio Management (PPM) is long established and proven to create business value. Over time, it has evolved to yield greater results from the efforts of the PMO and continues to adapt with the market and needs of the business. PPM best practices have been battle tested to show what works in the field. This guide outlines some of the best practices that have long benefitted PPM leaders and why it is important to apply them to a strategy-driven approach for greater business value contribution.

Regardless of where you are on your PPM journey, incorporating PPM best practices can improve how you deliver on business goals. Implementing a strategy-first approach ensures your organization is aligned from the top-down while also ensuring bottom-up support to deliver what needs to be done. PPM best practices are designed to drive measurable impact for the business and builds credibility for the PMO to continue on its journey.

Portfolio management has many different aspects, but mastering the key components sets the PMO up for long term success. Keeping in mind how each function of portfolio management fits together and works together to create a cohesive unit, developing each area helps the other and drives toward the greater mission of the PMO, and business overall.

Hear from industry leaders on PPM best practices and take a look at how using P3M to structure a value-driven organization can help support your journey – whether your goal is PPM excellence, business transformation, or customer success.

Designing a PPM Framework

A Project Portfolio Management (PPM) framework enables organizations to select, prioritize, approve and execute projects in such a way to cost-effectively meet business objectives. Organizations that consistently balance the portfolio with the right mix of short, medium and long-term projects can execute on strategy as well as identify and take corrective actions on non-compliant projects.

But does this really help deliver real value to the business? Absolutely. Done right, a PPM framework ensures the organization is executing on the right projects for the business in the most efficient way. Measuring project success accurately with strategic KPIs that mean something to functional leaders is quite easy to sell to the executive team. If you are guilty of only measuring success on costs and deadlines, you’re selling yourself short.

To align projects with corporate objectives and business strategy, and to ensure you’ve selected and prioritized based on resource capability and financial constraints, you must have a solid PPM Framework.

A PPM framework is designed to empower the PMO to deliver at the full extent of its capabilities. Portfolio investments become balanced to include long-term, short-term and medium-term projects as well as high and low risk projects.

Strategic Vision

A PPM framework starts with strategic vision. Aligning PPM to the strategic vision of the organization ensures all projects and investments are coordinated to meet an overall objective. While project performance is important, even the best executed projects will not make an impact if they don’t help to achieve a larger goal. As projects and requests come in, it is important to evaluate them individually and determine which ones support the strategic vision. This should flow throughout the portfolio management framework and be supported by all work and resources.

Governance and Process Design

A critical piece of any PPM framework is the governance and process design of the PMO. This design should be strong yet malleable, and consistently revisited to ensure it is adequately supporting the organization as it grows and evolves. For example, a team that is small and lean might need minimal governance and process because not many project types have been done before. But an established team might be process driven because many of the projects they work on have been executed before and there is a template for that to help streamline the process. In either case, reviewing existing processes and how much process is needed is always a good best practice. Governance ensures the organization is in compliance, maintains a standard of quality, and ultimately delivers on their promises. It is never good practice to be taking on more than your team is able to deliver or conversely, to have underutilized or benched resources because a lack of governance or oversight. While governance might seem like an administrative burden, it provides an exceptional level of efficiency because there is a pattern and a playbook rather than spending effort recreating something that has been done before.

Work Execution

Managing the portfolio has a big impact on the business but that still means that work execution needs to be aligned with the projects, portfolio, and strategic vision. This means mapping out project deliverables and tasks that support them, understanding dependencies and scope, and reducing time to value with resource management. Managing work and execution level project details requires detailed planning and a high level of coordination to ensure project that get started are able to be finished. Work execution also requires a lot of on-the-fly planning and ad-hoc changes to keep the projects on track and driving toward their desired outcomes.

Systems and Tools

Many of the functions performed by the PMO are accomplished through strategic planning and careful execution. But none of this is possible without the support of systems and tools to provide team members and leaders visibility and data to make those plans. Systems provide information to those that need it while keeping data centralized and up to date for easy retrieval. Integration of systems is also common because teams are accustomed to specific tools and training can be a difficult task. It also helps to adopt a best-of-breed approach to systems so that the teams can use the tools that are best suited for their needs but also getting the value of shared information where needed. Tools help teams work faster and spend less time on administrative tasks or looking for information. A core element of a PPM framework is the systems and tools that support PPM best practices to ensure visibility and efficiency.

Business Benefits of a PPM Framework

Portfolio Management consists of each of these elements and requires proper application for intended results. Let’s look at some of the key benefits from following a solid framework.

Prioritization

A prioritized portfolio means you’re not only doing projects right but you are doing the right projects. By keeping a value-based scoring model, you have a strategy-driven portfolio with execution-based planning to back it up.

Efficiency

Systems and tools can go a long way to support efficiency but process and governance will do the rest. Keeping people assigned to the right work, making pivotal changes as you go along, and providing the visibility from the top down (and bottom up) will ensure you are putting your precious resources toward the work that matters most.

Decision making

Improved decision making is reason enough to implement best practices, but for portfolio level decisions, it is crucial for business success. Having accurate data will not only provide executives the information they need, it builds credibility for project managers and the PMO.

Agility

Providing visibility and the means to roll out quick decisions creates agility at the business level. If strategic direction changes, the PMO is equipped to handle changes and re-align efforts with the needs of the business. Rolling out new products, ramping up new business units, or transferring focus from one area to another do not need to hinder the organization, rather it can get ahead because they can act – and react – much faster to changing conditions.

Expand Your Knowledge

With a new, optimized PPM framework, you equip your teams with the fundamental tools needed to perform at maximum capacity. To measure performance ensuring all projects/programs are collectively meeting the portfolio strategy while continuously improving your efforts. To get aligned and stay aligned with organization needs and drive value from investments. A PPM framework is not just a best practice, but an essential aspect of a high performing PMO.

Discover how Applying Strategy to Your PPM Maturity helps leading PMOs mature their PPM practices to deliver stronger results.

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