5 Reasons You Need Project Portfolio Management Software
5 Reasons You Need Project Portfolio Management Software
Management is doing things right; leadership is doing the right things.
….. Peter Drucker
As business grows, team size increases in organizations, it aims for higher maturity level in terms of processes to manage business growth, manage people. Same is true when organizations starts taking up plenty of different projects. Merely having project managers will not drive all these projects in right direction. That’s where project portfolio management techniques comes into play.
What is Project Portfolio Management?
Let me share introductory quotes about project portfolio management (PPM), from Wikipedia page.
Project Portfolio Management (PPM) is the way of managing processes, methods, tools and technologies used by project managers, project management office to monitor, analyze and manage current, proposed projects by evaluating various key indicators.
To put it simply, project portfolio management is higher-up step in the value chain of managing projects on greater scale, wherein projects are grouped into portfolios and current, new projects are analyzed for better alignment with organization’s goals. This analysis further is used to prioritize right projects & project activities, monitor progress of projects and support project managers.
One can imagine, as number of projects grows, number of portfolio increases, it becomes overwhelming for project portfolio management (PPM) team to track project timeline, whether resources are assigned optimally, project cost is still within budget, value-earned/delivered by projects and other parameter. Without using a right tool, it becomes quite laborious job for project managers as well as PPM team to track or manage projects and portfolio information. (we are not talking about PMO team – which is broadly about doing project things in right way – i.e. project management processes)
If organization is collecting project data like project progress in terms of schedule, cost, resource hours, issues, risks, earned value, etc manually, it is certainly a painfully difficult task. This difficulty gets further compounded by manual errors in analyzing, forecasting this information. It will lead to erroneous evaluation, benchmarking and of course possibility of wrong decision based on not-so-correct-project-data.
Let’s look at the typical difficulties and complexities associated with project portfolio management.
The Challenges Faced By Project Portfolio Management Team
The project portfolio management efforts are undertaken by organization to prioritize, monitor and control process for managing multiple projects in an organization. Since it is an overarching team or process over project management, it has its own challenges such as
- Different stakeholders have varied interest in pushing their own projects, prioritizing projects, allocation of budget and resources is challenging
- As number of concurrent project requests starts piling up, and resources remain scarce, it leads to resource conflicts. The inability to resolve resource conflict and inability to optionally allocate resources project delays, cost-overrun
- Portfolio managers and team struggle to prioritize project proposals if they do not have clearly outlined risk-benefit evaluation parameters before accepting new project proposal
- Performing an ongoing evaluation of currently running projects whether they are meeting organization’s business goals
As one would realize that people related conflicts have to be resolved by talking to them, communicating with them. However for other challenges, where portfolio manager needs to take a decision, will be handled better based on data-driven approach by experienced portfolio manager.
- Knowing what sort of resources are required in order to deliver a project
- Finding right resources to allocate to a given project
- Tracking project cost to stay within budget,
- Tracking billing and in turn revenue to maximize RoI
- Forecasting resource need, budget requirements and benchmarking project performance
Use of project portfolio management software (PPM Tool) will make it easy to get right information, set right resources for projects and tracking project performance against benchmark. Not only it will make easier to get these information, it also reduces risks associated with erroneous data collected manually. Basically using right project portfolio management software helps organization to address challenges associated with project portfolio management.
This is where the right tool can come in to help ensure the needed efficiency of the company.
Benefits of Using Project Portfolio Management Software
The biggest benefit of using project portfolio management software (PPM Tool) is improved efficiency. The improvement in efficiency is characterized by transparent project communication, ease of updating and collecting project information, making priorities, trade-off decisions based on available information that is collected ground-up manner.
The entire point of PPM is to improve the bottom line by prioritizing the project portfolios that add value and contribute to the health of the organization. And when you use the right software for the job, you can do this at a much faster pace.
Clear Visibility of Project Organization Health at Your Fingertip
Gone are the days where senior manager would ask for status update and all of his subordinates start running around to collect status information, spend hours in create/update spreadsheet reports. With project portfolio management software, high-level status of portfolio of projects is available to senior managers at a click, at any time. You don’t have to rely on spreadsheet prepared by managers; you get access to information shared by resources working on the ground.
Clear Visibility Means Efficient Resource Management
Organizations struggle to deploy right resources to right projects, simply because they do not know who right resource is and which one is the right project. With PPM software you get clear visibility that can drive efficient resource management. You have a clear visibility into who is working on what, how much s/he is occupied or available, which project needs what sort of resources (skills, roles, workload, etc.). You can perform what if analysis around resource allocation, assignment; track project cost implication it may have.
You will certainly be making better decision using project portfolio management software rather than making resource allocation on random basis or based on a gut feeling.
Greater Transparency Leads To Greater Trust
Project portfolio management software offers greater transparency not only for senior management but also for team members and customers. Project portfolio management software (PPM Tool) becomes a central platform where project managers creates project request/proposal, PMO team can review it and once approved, project team members can start collaborating on the project. As project manager update project schedule, Gantt chart, issues, risks, meetings – all team members get informed of these update. This removes communication gap or confusion that may arise because of multiple copies of project documents, project plan, project charter, etc.
Such transparency automatically brings more trust factor in team communication or even stakeholder communication. You don’t have to worry about I-missed-to-mark-you-Mr.-stakeholder.
Refined Tracking Cost and Revenue Contributions, Paves Way for Optimization
The right project portfolio management software provides a real-time access to refined cost elements at task level, project level as well as portfolio level. You can track billing or revenue contributions for each project. The real advantage of such software is you can clearly understand which one of resource cost, fixed cost or other cost, are the main driver/contributors of cost estimation; who are contributing towards higher billing of project. You can use this information to optimize cost or maximize revenue/billing of the project.
Should You Use PPM software?
If your organization has moved up in the value chain to project portfolio management in order to support multi-project management, you will be able to use much efficient approach using project portfolio management software. You can keep track of project resources, project cost, and project delivery and evaluate whether those are meeting organization’s goals.
Not having a PPM tool means you will have difficult time in streamlining your PPM practices. Also, if you would like to converge and make the best out of the worlds of PPM and PMO, technology will support this convergence greatly.
Your life can be become easier with the right project management system. ZilicusPM is the right PM tool for you and your team. Get started now.
Additional readings about project management, leadership
- Case Study: What Happens When Project Team Has Dual Reporting
- Avoid These 10 Most Common Mistakes That Leads to Project Failure
- Back2Basics: Ultimate Project Management Guide: Project Planning
- 8 Reasons to Decide Whether Your Organization Needs Project Management Office
- Compare the best project management software
- All in one project management software
- Guide to selecting best project management software
- Gantt Chart
- Time Tracking
- Budgeting and Cost Management
- Resource Planning and Management
- Issue Tracking
- Risk Management
- Change Management
- Meeting Management
- Stakeholder Management
- Project Portfolio Management
- Project Reporting
- Document Management to help you manage and deliver projects better?
Know more about project portfolio management, Gantt chart, best project management tool, project management office, project management tips, project planning guide, project risk management, project scope management, effective project management, project manager guides and know more about Project Portfolio Management Software, Project Management Software Guide.