PROJECT PORTFOLIO

MANAGEMENT
UNIT 4 CONSTRUCTION PROJECT MANAGEMENT
M.ARCH (BUILDING MANAGEMENT)

Ar.N.KIRUTHIGA LAKSHMI
B.Arch, M.Arch (Building Management)
ASSOCIATE PROFESSOR
DEPARTMENT OF ARCHITECTURE
SATHYABAMA UNIVERSITY

CONTENTS

PROJECT PORTFOLIO MANAGEMENT

OBJECTIVES OF PROJECT PORTFOLIO MANAGEMENT
BENEFITS OF PROJECT PORTFOLIO MANAGEMENT
BRIDGING THE GAP BETWEEN PORTFOLIO MANAGEMENT AND OPERATIONS
MANAGEMENT

PROJECT PORTFOLIO MANAGEMENT

PROJECT: According to the PMBOK Guide 5th edition, A project is a

temporary endeavour undertaken to create a unique product, service or
result.

once the project achieves its objective its existence comes to an end

project team members will be separated once the project is

completed

Project team may include members outside the geographic location.

PROJECT PORTFOLIO MANAGEMENT

PROJECT MANAGEMENT: Project management is the process that

helps projects achieve their objectives

processes include initiation, develop a plan, executing according to

approved plan, controlling over its lifetime and handing over

It is the application of knowledge, skills, tools, and techniques to

project activities to meet the project requirements.

PROJECT PORTFOLIO MANAGEMENT

PROGRAM: A program is a group of related or similar projects managed

in a coordinated way to get the benefits and control not available from
managing them individually.

This means that in a program you will have multiple projects which are
either similar or related to each other.

Eg: one project is to construct a school building and another to construct an

office building

PROJECT PORTFOLIO MANAGEMENT

PROGRAM MANAGEMENT: Program management is defined as the

centralized coordinated management of a program to achieve its
strategic objectives.

only manage the interrelated or interdependent projects as a group

to achieve the desired result.

The objective of program management is to optimize the utilization

of resources among projects and reduce the friction or constraints so
as to increase the organizations performance.

PROJECT PORTFOLIO MANAGEMENT

PORTFOLIO: Portfolio refers to a group of related or non-related projects

or programs.

A portfolio can consist of multiple programs or multiple projects

without having a single program.

Eg: one project is to construct a building, next is to conduct research on the

impact of motor pollution on the environment and another to set up a call
center
You will manage these projects by keeping them under a portfolio,
because all three projects are neither related nor similar to each

PROJECT PORTFOLIO MANAGEMENT

PORTFOLIO MANAGEMENT: Portfolio management has a bigger scope

and objective than program management.

In portfolio management, there is a centralized management whose

job is to identify, prioritize, and authorize the projects or business
objectives.

Although portfolio management sets the priority of the projects or

programs in a group, it does not oversee any individual project or
program.

PROJECT PORTFOLIO MANAGEMENT

PROJECT
MANAGEMENT

PROGRAM
MANAGEMENT

PORTFOLIO
MANAGEMENT

TYPE OF PROJECT One individual

project

Multiple similar or Non-similar

related projects
projects or
different
programs

SCOPE

Project oriented
scope

Program
objective
oriented scope

Organization
wide scope

RESPOSIBLE
PARTY

Project manager

Program
manager

Portfolio manager

SUCCESS
CRITERIA

Timely
Degree to which
completion within it satisfies the
budget and
objective

Combined
performance of
the components

PROJECT PORTFOLIO MANAGEMENT

PORTFOLIO MANAGEMENT: Project Portfolio Management (PPM) is the

centralized management of the processes, methods, and technologies
used by project managers and project management offices (PMOs) to
analyze and collectively manage current or proposed projects based on
numerous key characteristics.

OBJECTIVES OF PPM

The objectives of PPM are

to determine the optimal resource mix for delivery

to schedule activities to best achieve an organizations operational

and financial goals,

while honouring constraints imposed by customers, strategic objectives, or

external real-world factors.

OBJECTIVES OF PPM

Provides program and project managers in large, program/project-driven

organizations with the capabilities needed to manage the time,
resources, skills, and budgets necessary to accomplish all interrelated
tasks.

Provides a framework for issue resolution and risk mitigation,

Provides the centralized visibility to help planning and scheduling teams

to identify the fastest, cheapest, or most suitable approach to deliver
projects and programs.

BENEFITS OF PPM

Greater adaptability towards change.

Constant review and close monitoring brings about a higher return.

Management's perspectives with regards to project portfolio

management is seen as an 'initiative towards higher return'. Therefore,
this will not be considered to be a detrimental factor to work.

Identification of dependencies is easier to identify. This will eliminate

some inefficiency from occurring.

Advantage over other competitors (competitive advantage).

Helps to concentrate on the strategies, which will help to achieve the

targets rather than focusing on the project itself.

BRIDGING THE GAP PM & OM

Before the emergence of Project Portfolio Management, as a defined

discipline, these elements were the responsibility of two distinct groups;

Operations Management and

Projects Management.

BRIDGING THE GAP PM & OM

TRADITIONAL MANAGEMENT
PROCESS
OPERATIONS
PROJECTS MANAGEMENT
MANAGEMENT
Objectives

Schedule / time

Goals

Project cost

Strategies

Performance

Project selection & mix

Stakeholder satisfaction

Cash flow
Scope / change control
No connection between the OM and PM
No structured, consistent and meaningful flow of information between
these two groups

BRIDGING THE GAP PM & OM

TRADITIONAL MANAGEMENT PROCESS operations
management
How would OM know,

Are the projects being worked on still best ones to support the
organizations objectives?
How well are they supporting the objectives?
Are there performance issues associated with meeting the objectives?

BRIDGING THE GAP PM & OM

TRADITIONAL MANAGEMENT PROCESS project
management

How would PM know, when evaluating the project performance data,

What knowledge is available to influence the corrective action
decisions?
If the individual project are in danger, what should the project
manager know to work on balancing schedule, cost, scope and quality
parameters?
Can this be effectively done in the absence of operations inputs?

BRIDGING THE GAP PM & OM

Project Portfolio Management is a bridge between traditional operations

management and project management.

Both the Projects and Operations side of the enterprise must be

represented via some type of structure.

For projects, a common structure is the Project Management Office

(PMO).

A similar structure is needed to represent the interests of the operations

side of the business.

BRIDGING THE GAP PM & OM

In PPM, this has taken the form of the Governance Council (GC) or
something similar in nature.

The GC consists of senior-level representatives of the COO, CFO, CIO,

etc.

It is the GC that makes the final decisions on content of the portfolio,

usually acting on recommendations and data furnished by the PMO.

The bridge, which we talked about earlier, is essentially a bridge

between the PMO and the GC.

This consists of processes and relationships that facilitate their joint

participation in the prioritization and selection (and de-selection) of

PPM AS THE HUB

we should view PPM as the nucleus of a system

that brings projects and operations together.

It is the core of an integrated collection of

processes that represent both operations and
projects functions.

It is also the engine that drives the production of

project deliverables to enhance the total health of
the enterprise.

PPM AS THE HUB

Building a bridge between these two functions

will not do the job.

A bridge acknowledges that a gap exists, and

does little to eliminate the gap.

A connection between these two entities is not

enough.

They must be brought together in unity.

PPM AS THE HUB

PPM ties these distinct functions into an efficient

business machine, one that increases the value
and purpose of projects so as to contribute to the
overall health and success of the enterprise.

It does much more that bridge a gap.

It eliminates the gap by bringing these diverse

functions together.

PPM AS THE HUB

If embraced and supported by senior

management, PPM becomes the core of a set of
combined business and projects processes,
leading to much improved effectiveness in the
use of limited cash and human resources.

THANK YOU!