Projects, programmes and portfolios, so what is the difference?
Guest speaker, Merys Hopkins, first looked at portfolios, which APM define as a grouping of an organisations projects and programmes. The grouping can be by geographical location, capability, customer type, etc, as determined by the organisation’s circumstances. The portfolio should be designed to maximise return on investment, maintain skills in the workforce, and to aid control of costs and benefits.
Portfolio management includes the selection, prioritisation and control of projects and programmes which are aligned with the organisations strategy and objectives. The portfolio manager decides which projects/programmes to undertake, provides the required resources, makes sure they are being used efficiently, and chases benefits. The portfolio manager is responsible to the executive board for delivery. The portfolio makeup will also be subject to external influences such as customers and the market place.
Programmes are a group of related projects and change management activities that will deliver beneficial change. Grouping allows oversight and prioritisation of resources, economies of scale, minimising duplication, management of interdependencies, co-ordination of stakeholders and communications, and easier sharing of lessons.
The programme manager needs to stay out of the weeds. They are responsible for the overall planning of the programme, co-ordinating the management and control of the projects, prioritising resources, senior stakeholder management, supporting and communicating high level risk, and delivering benefits. Their key role is to support the project managers and unblock issues. They can act as sponsor for the projects.
Projects are a unique transient endeavour intended to deliver planned objectives. They are unique, time bound, have specific costs, clear scope, acceptance criteria, risk and uncertainty, and are run by dynamic, transient teams with specialist roles as and when required.
Projects are influenced by stakeholders, governance and risk all of which can reshape the iron triangle of time, cost and quality.
Project management uses processes, methods and training, together with knowledge and skills of the project manager and team to deliver the required outputs.
Merys summarised the differences:
Portfolios: Strategic Grouping, Focus on maximising return on investment, Balanced mix of projects and programmes, Ongoing, Higher risk.
Programmes: Focus is on outcomes, Higher Complexity than projects, Longer Timescale, Higher Budget, Scope is less defined, Higher Risk.
Projects: Focus is on outputs, Less Complex, Defined start and end dates, Agreed total budget, Defined Scope, Less Risk.
The key to success is the effective governance of projects, with the 4 pillars of governance: Portfolio direction (aligned with organisational strategy), the right Sponsorship, (fighting for support), Project Management Effectiveness, (tools, techniques, trained staff), and Disclosure and Reporting, (being honest about good and bad news, and asking for help when needed).
In summary. Portfolio management is about doing the right projects, to deliver an organisation’s strategy and objectives. Project and programme management is about doing projects right!
As usual, the presentation is available below and on the APM Web Site SlideShare page.
SWWE Branch Chairman