Project Portfolio Management: Prioritizing and Balancing Multiple Projects

Posted on Sep 25, 2023 at 12:09 AM

Project portfolio management is a critical component of best practices, but it can also be one of the most challenging. As organisations grow and new projects are added to the mix, prioritising and balancing multiple projects becomes increasingly important. 

In this article, you will learn about the importance of project portfolio management and how it can help you make better decisions. 

What is portfolio management in project management?

We all know how it goes in every business company: a business idea turns into a project, a manager is trusted to manage it, and then voila! We just have to sit and wait for the magic to happen. 

Not entirely,  because there's a lot more to it than just that, and this is where portfolio project management comes into play; it allows us to manage all the projects we have going on at any given time. Moreover, it's one of the most essential Personal Skills for Project Management that every manager needs in the 21st century.

Project portfolio management is simply the process of managing projects (through portfolios) in a strategic, comprehensive way that helps managers approach several projects simultaneously.

P.S. Portfolios are groups of programs, processes, objectives, and operations aligned strategically according to their importance to the company's goals.

But what goes on in project portfolio management? 

The goal of project portfolio management is to manage multiple projects and programs to maximise business value and return on investment, so it involves making decisions on:

• How to select projects and investments to undertake

• How much effort should be allocated to each project?

• What metrics will be most efficient when evaluating project performance?

• how much risk can be tolerated (and by whom)

• how projects will be staffed

• How to identify the costs, potential, goals, and outcomes of each program
  
  

What is an example of project portfolio management? 

Let's say there's an airport in London with many technical issues: suitcases are missing, flights are delayed due to technical errors, etc. This airport is losing a lot of resources and has recently opted for a change to a new software that will upgrade its technologies and improve workflows. 

So, this airport invites teams of experts for the execution of this significant change; they first start with the essential needs, changing the flight management software to a more effective one (That's one project portfolio), then another expert suggests that using the same software to connect each flight with their passengers' suitcases information would offer a more practical system that would reduce the amount of error that happens during flights - it would be easier to link the baggage to the plane because these two are interrelated (another portfolio) 

Another expert offers a new tracking model to ensure the delivery of suitcases and avoid any mix by providing a bar code for each bag. (yet another portfolio). 

The role of project portfolio management in this example is to look at the bigger picture, examine each portfolio and develop methods and solutions that can help align those projects together to create an overall systematic operation that ensures the success of each of those portfolios without any constraints.

What is the difference between PMO and PPM?

As previously mentioned, PPM brings together all the projects and initiatives in an organisation, creating a big-picture view of everything that needs to be done. It helps the enterprise prioritise its work to align with the goals and achieve optimal business results. 

It does that through analysing a collection of projects and ensuring that all programmes involved deliver the best results across all departments; this way, the company's entire set of tasks is aligned through all its elements. And it's all done through project portfolio management. 

On the other hand, a PMO, or project management office, is where a company would coordinate and control all the master plans. It's a committee (or place) responsible for planning and selecting which projects to do and how to manage them. 

What are the benefits of project portfolio management? 

As a manager or a CEO, you might be wondering how this project management skill might help you excel in your business life; we’re here to make that question easier; here’s how:

• For starters, it's one of the most essential Engineering Project Management Skills companies look for in any employee.
  Let’s consider that this skill is in such high demand is straightforward, a manager who manages multiple projects at once, deals with problems and offers immediate creative solutions is basically on another level!

• It also enables you to effectively allocate company resources, prioritise projects and adhere to the company’s budget.

• Moreover, project portfolio management provides an overview of all projects without the need for constant individual monitoring.

• It helps remove waste and increases efficiency: Each project is managed with clear objectives and goals, so your team doesn’t get off track.

• With PPM, you can delegate tasks more efficiently and effectively by knowing exactly what needs to be done, how long it should take and how much it will cost. 

• If you decide to participate in a Project management diploma in London, you will learn to plan better to create schedules with as much detail as possible.

• It's a great project management tool that will be helpful during all your project management phases.

Ultimately, it's important to remember that project portfolio management is about creating a path towards a desired outcome.  The more detailed the plan, the better it will be able to guide you through the project and keep you on track.