Clear Loop

Project Portfolio Management: Close the Loop!

Project Portfolio Management takes place in between strategy formulation and implementation of the actual projects. Projects are supposed to arise out of Organizational strategy is intended to set the general direction and lay out the guidance for determining the types and which projects to implement. Project Management resides in the realm of implementation and comes onto the scene after the strategic direction has been set, and after the project portfolio has been determined and prioritized. The challenge is that there can be disconnects at the transitions among these phases, and the most important thing is to develop a feedback loop.

Typically at the highest levels within an organization, there is much study and debate over strategy, and eventually the direction is set. Hopefully this process includes an organized effort to gather information from throughout the organization, and to determine direction for the organization. That direction includes a set of guiding principles and generalized initiatives that provide the input for the project portfolio management, or PPM, process. This is a matter of organizing a large set of projects into a portfolio, then developing a system for managing and prioritizing the list of projects, with primary input from the strategic planning process. The final result at this stage of the project portfolio management process is input to the project management processes, in the form of the list of final projects to be implemented.

The question is, “How can the intentions developed in the strategic planning process continue to live in the project implementation phase?” The answer, I believe, is very practical and simply involves creating a clear feedback loop to the project portfolio management process, which should then be empowered to provide the relevant information back to upper management at the strategic level. This provides an opportunity to monitor projects against intentions, and not just against performance parameters within the project itself. It also allows for mid-stream adjustments to actions taken early in the cycle, based on changing external conditions, or based upon project execution assumptions that might now look incorrect.

Looking at this as a purest, one could reduce all of this down to what a single individual would do, and perhaps identify some disconnects in the process. Let’s say that and individual had decided to build a playhouse for the back yard. Presumably, this individual is not only party but also central to every decision that has been or will be made about the play house – at the strategic, portfolio, and project management level. It will not be difficult for this individual to carry through on project management level decisions with the perspective of the strategic and portfolio management levels, since it is all in his/her head. He/she will have the opportunity to made mid-course correction based upon new knowledge gained as the project proceeds, and this could include items such as increased cost, change of priorities, more time than expected, and more.

By designing the feedback loop into the project portfolio management process, we are designing in the advantage that the individual has on a smaller project. That advantage is something that is practiced effectively in many organizations, and is also unfortunately not practiced in some that suffer from disconnects between high-level decisions based on strategy and implementation level-actions and resulting experience. Since the only certainty is uncertainty, conditions will change, and it is important to build effective feedback loops into our project portfolio management processes.

About the Author

For online Project Portfolio Management training courses – PMI standards-aligned and qualifying for PDUs), see Project Portfolio Management Online Training at Project Management Training Online. For more ideas and insights on project portfolio management, strategy,. and enterprise architecture, see PMcrunch.com.

Clear Loop

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