Project Portfolio Management (PPM) Microsoft Office Project Portfolio Server Ann-Charlotte Arrhenius...

Project Portfolio Management (PPM)Project Portfolio Management (PPM)

Microsoft Office

Project Portfolio Server

Ann-Charlotte Arrhenius

[email protected]

Microsoft Office

Project Portfolio Server

Ann-Charlotte Arrhenius

[email protected]

April 18, 2023Portfolio Management Overview 2

UMT have a Proven Track RecordUMT have a Proven Track Record

We have implemented PPM solutions in over 50 clients within Fortune 1000 type companies. Our solution enables companies to Create, Select, Plan and Manage their project portfolios at all levels.

As the pioneers and thought leaders of this area we believe we are genuinely the best at what we do, which is making your strategy work effectively.

UMT, established in 1989, specializes in project portfolio management, and deploys the most sophisticated software tools available today.

With offices in New York and London, UMT’s consulting services enable companies to manage their project portfolios throughout their lifecycle. Our software was recently sold to Microsoft to be added onto the Enterprise Project Management Solution.

Voted World #1 in the 2004 MetaSpectrum Review of PPM


Project Portfolio Management

Alignment Alignment with Business with Business Objectives Objectives

Integrated Integrated Delivery Delivery Framework Framework

Real-time Executive Real-time Executive Decision SupportDecision Support

Portfolio Portfolio ManagementManagement

Investment, Resource and Investment, Resource and Prioritization DecisionsPrioritization Decisions

Integrated Portfolio of Integrated Portfolio of Managed ProjectsManaged Projects

Consistent, Repeatable Consistent, Repeatable Project DeliveryProject Delivery

PMO / EnterprisePMO / EnterpriseResource Resource ManagementManagement

CorporateStrategy

Programs andInitiatives

Projects

Project Project ManagementManagement


Select & Deliver the Right Investments… Select & Deliver the Right Investments… S

ele

ct

the R

igh

t P

roje

cts

Deliver the Projects Successfully75% 100%

66%

100%

0%

Portfolio Management

Project Management

50%Value Realized

50 % Value Lost

Portfolio Management enables organizations identify and select the investments that will maximise

Business Value

Project Management ensures organizations to successfully deliver the investments and realise the Business Value


To Be Successful Organizations Require Both Disciplines

Portfolio ReportingBenefits Realization

PROJECT MGT.Project PlanningCost ManagementResource ManagementTime ReportingChange ManagementIssue ManagementStatus ReportingEarned Value Analysis

PORTFOLIO MGT,Process DefinitionGovernanceBenefits ForecastingPrioritization / ValuationPortfolio OptimizationAdv Portfolio AnalyticsCapacity Planning

Have I selected the right investments?

Do the investments align with the strategic objectives?

Do I have sufficient resources to deliver the selected investments?

Will the investments be delivered on time and within budget?

Are my investments delivering the forecasted benefits?

PPM answers the following

questions:


What is Project Portfolio Management (PPM)? What is Project Portfolio Management (PPM)?

Management Discipline – improves alignment between strategy

planning and business/IT; strengthens governance; improves project

definition, portfolio selection, resource planning and executive reporting

Comprehensive Project Inventory – develops and captures

new, ongoing and carryover work centrally to provide transparency around

how key Business Drivers are supported and how resources ($/FTE) are

dispersed

Transparent & Actionable Decisioning Framework – provides ongoing and actionable portfolio analysis and reports to the

decision-makers to enable improved investment viability and accountability

PPM is: a management

discipline that helps organizations achieve

maximum project portfolio value

through the continuous process of

evaluating and managing projects

against key performance metrics

and strategic business objectives.

PPM is: a management

discipline that helps organizations achieve

maximum project portfolio value

through the continuous process of

evaluating and managing projects

against key performance metrics

and strategic business objectives.

Workflow With Roles & Responsibilities – provides clearly

defined roles and responsibilities throughout the process and Governance

framework

Analytical software toolset – leverages toolsets to capture project

inventory and to ensure optimal, consistent and fact-based portfolio selection and

planning decisions by simultaneously evaluating and comparing competing

project ideas and resource needs (e.g., what-if, sensitivity analysis, optimization,

etc.)

“Alignment is the essence of management” Fred Smith, Chairman Federal Express


•Reasons for project failure are plentiful; emphasis on execution failure and / or lack of project management capabilities

• Is this the only - or even the primary - dimension to reduce value of the project portfolio?

OverviewOverview

•This presentation suggests that when selecting projects, it is essential to take a portfolio view, rather than a project by project view

• It will discuss how effective selection techniques can be applied in practice


Benefits of a Portfolio Management Approach:Confidence, Transparency and FlexibilityBenefits of a Portfolio Management Approach:Confidence, Transparency and Flexibility

Key BenefitsCreates a common currency for comparing investments and making better-informed decisionsEnsures decisions made according to supportable data, not politics or ‘noise’Reduces senior management time spent on decision-makingReduces overall spend by eliminating low value investments Uses a benefits-led approach to delivering strategic projectsEnables greater focus on high-value initiativesPromotes organisational agility through modelling of ‘what-ifs’ and other detailed scenario analysis

Specific Examples“..we saved $5 to 10mm (out of a budget of £50mm) in the first year alone, on projects that would have gone through automatically before” – Paul Bateman, Director of Enterprise Governance, Axa Financial

“UMT’s solution led our Senior Executive Team to increase the 2004 budget to allow additional projects to be funded, based on their proven strategic value” – Frank LaRocca, CIO Keyspan Energy

“Capable of solving exceptional business problems” – MIT Sloan Review, May 2004


Stages of ExcellenceBasic World-Class

PPM Maturity Stages

Val

ue

to O

rga

niz

atio

n

Ad hoc

No Portfolio Inventory or Process

-“Just Do It/FIFO”-Success is random-Poor transparency

Project

Inventory

Processes are defined & documented, and most

projects are aligned to Business Driver

All projects are consistently captured in a project

inventory

Project

Portfolio

Portfolio analysis is repeatable, predictable, and consistently used to evaluate and optimize project portfolio

selection

Portfolio Management teams are able to understand, analyze, & recommend

optimal portfolio bundles and schedules to technology

and business partners

CrossPortfolio

PPM is adopted and used consistently across multiple organizations and portfolios

Portfolio Analysts can compare and leverage

portfolio analysis information across multiple departments

Consistent measures enable cross portfolio analysis, selection, planning and

management that supports predictive modeling and

internal / external benchmarking

Enterprise

PPM is optimized across the enterprise with a focus on continuous risk mitigation

and value creation

Project portfolio performance and risk data is understood

and can be compared at the individual, cross-LOB, and

enterprise levels

Senior leadership is able to leverage PPM analysis when

allocating funds to various portfolios

Ability to measure and benchmark entire portfolio

lifecycle

Portfolio Value = Value Potential x Ability

to Realize

Crawl Walk Run

Success Comes With Iteration & Increasing SophisticationMoving Up The Portfolio Maturity CurveSuccess Comes With Iteration & Increasing SophisticationMoving Up The Portfolio Maturity Curve


Application Analysis &Renewal Strategy

ApplicationOperations &Maintenance

Application Portfolio

Management

PortfolioValuation &

Selection

PortfolioExecution

Project Portfolio

Management

New Project Requests

New / Enhanced ApplicationsNew / Enhanced Applications

Business StrategyBusiness Strategy

IT StrategyIT StrategyCurrent Investments

NewInvestments

The Task of Continuously Renewing the Company Assets Capabilities is the Greatest Challenge Facing any CEO and CIO

Portfolio Mgmt: Synergies Between APM & PPM Portfolio Mgmt: Synergies Between APM & PPM


CreateCreate SelectSelect PlanPlan ManageManage

Portfolio Prioritization & OptimizationPortfolio Prioritization & Optimization

The next slides provide an overview of the Business Alignment Framework embedded in the Portfolio Optimizer

Ensure the selected project portfolio aligns with the organization’s strategic priorities


Business Alignment Framework:

Business Driver DefinitionBusiness Alignment Framework:

Business Driver Definition

Define Business Drivers & Impact

Statements


Carry-Over Requests

Prioritize Business Drivers

Prioritize Requests

Optimize Project Requests

• Strategic Value

• Financial Value

• Risk

• Assess the Portfolio

• Constraint Analysis

• Advanced Analysis

Select Portfolio


DefineDefine PrioritizePrioritize OptimizeOptimize SelectSelect

‘‘The Business Alignment Framework ensures a The Business Alignment Framework ensures a RationalRational rather than rather than Emotional Emotional approach to project selection’approach to project selection’

11 22

33

44 55


Pre-defined workflows ensure the projects are subjected to the appropriate governance controls throughout their

lifecycle (i.e. proposal to post-implementation).

Capture all project requests within a central repository and define business case templates to standardize the

data collection across the organization.

Portfolio BuilderCreate: Business Case DevelopmentPortfolio BuilderCreate: Business Case Development

Capture Project Requests / Ideas

1

2

Governance Workflow


Business Alignment Framework:Business Driver Definition (Theory)Business Alignment Framework:Business Driver Definition (Theory)

Business Drivers are a series of short, sharp statements that express the shared focus of the organization in actionable terms

Strategic Goal 1

Strategic Goal 2

Business Driver 1

Business Driver 2Business Driver 3

Business Driver 4

Business Driver Criteria:

They Address a Strategic Goal They Are Actionable They Are Measurable

They Are Attainable They Are Unique They Are Clear to Decision Makers



Business Driver Definition (Example)Business Alignment Framework:

Business Driver Definition (Example)

Strategic Goal:

Business Driver Name: Business Driver Name:

Retain existing clients Grow Customer Share of Wallet

Dedicate our resources to those market areas where we can maintain our existing client base and increase share of market of current clients

Business Driver Definition: Business Driver Definition:

Sell additional products to existing clients

Maintain clients and remain competitive in existing markets

KPI’s:

• Client Satisfaction Rates• Client Retention Rates• Variance in % Market Share

KPI’s:

• % Increase of Market Share• Increase in Revenue


The Role of Impact Measures:

• Impact Statements are defined by the Executive team

• Impact Statements provide a quantifiable link between the measurable Business Drivers and the project requests.


Impact Statement Definition (Theory)Business Alignment Framework:

Impact Statement Definition (Theory)

Impact Statements are derived from KPI’s and used to quantify the impact of each project request against each of the Business Drivers

Business Driver 1

Business Driver 2

Extreme

Strong

Moderate

Low

No Impact

Extreme

Strong

Moderate

Low

No Impact

Project

The Impact Statements should clearly communicate the metrics that define the level of impact a project request may have on Business Drivers.

Note: Existing KPI's / Balanced Scorecard/ Other metrics may be used

Impact Statements ensure that each project requests impact on the Business Drivers are evaluated consistently using the same metrics.


Thresholds

Extreme

Strong

Moderate

Low

Impact StatementsAssociated KPI’s


Impact Statement Definition (Example)Business Alignment Framework:

Impact Statement Definition (Example)

Driver Name: Grow Customer Share of Wallet

Definition: Sell additional products to existing clients

• % Increase of Market Share

• Increase in Revenue

Increases Revenue per client by more than 15% and increases Market Share by 5%

Increases Revenue per client by between 8% -14.99% and increases Market Share by 2% - 4.99%

Increases Revenue per client by between 3% - 7.99% and increases Market Share by up to 1.99%

Increases Revenue per client up to 2.99% and increases Market Share up to 1.99%


Business Alignment FrameworkPrioritization & OptimizationBusiness Alignment FrameworkPrioritization & Optimization

‘‘The Business Alignment Framework ensures a The Business Alignment Framework ensures a RationalRational rather than rather than EmotionalEmotional approach to project selection’approach to project selection’


Statements


Carry-Over Requests


Prioritize Requests


• Strategic Value

• Financial Value

• Risk




Select Portfolio


DefineDefine PrioritizePrioritize OptimizeOptimize SelectSelect11 22

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44 55



Business Driver PrioritizationBusiness Alignment Framework:

Business Driver Prioritization

The Pairwise Comparison is a proven technique for deriving relative priorities or weights for Business Drivers through performing one-to-one comparisons.

Indicates relative

importance of Driver A vs.

Driver B (row vs. column)

The same stakeholders who defined the Business Drivers should prioritize them. This ensures consistent understanding and better buy-in to the priority assessment conclusions.

Steps to Success:

Assess Divergence of Opinion: Each Stakeholder involved in the Business Driver Definition should prioritize the drivers independently

Build Consensus: Invite all stakeholders to a Prioritization Workshop and collaboratively complete the Pairwise Comparison Matrix. Encourage the group to openly discuss the importance of each Business Driver pairing for the upcoming planning period.

Compares the relative importance of Driver B

vs. Driver C (row to

column)





Statements


Carry-Over Requests


Prioritize Requests


• Strategic Value

• Financial Value

• Risk




Select Portfolio



33

44 55


Portfolio Optimizer

Select: Portfolio Prioritization

Portfolio Optimizer

Select: Portfolio Prioritization

Use proven techniques to define and prioritize

business drivers

Derive a priority score to evaluate each project request (i.e. Strategic Value, Financial Value, Risk)


Prioritize Projects

3

Assess the impact of each project request against the prioritized business drivers

Strategic Impact Assessment

Business Drivers

Pro

ject

s

4

5

Analyze the project portfolio before attempting to make funding decisions

6

Cost

L -

Pri

ori

ty -

H

Investment Maps





Statements


Carry-Over Requests


Prioritize Requests


• Strategic Value

• Financial Value

• Risk




Select Portfolio



33

44 55


7

9

8Utilize sophisticated optimization algorithms to maximize the

portfolio’s strategic value under varying budget constraints (i.e. cost, resource etc.)

‘What If’ Analysis

Efficient Frontier Modeling

Business Alignment Analysis

Portfolio Optimizer

Select: Portfolio Optimization & Analytics

Portfolio Optimizer

Select: Portfolio Optimization & Analytics

Benchmark the selected portfolio against the Efficient Frontier

Calculate and communicate the selected portfolio’s alignment with the organization’s strategic priorities


11

12

Identify resource surpluses and deficits across the planning horizon and maximize resource utilization by proactively scheduling the project portfolio to best fit the available resources.

Create real-time project and portfolio performance scorecards to ensure Executives and PMO’s gain visibility, insight and control across project portfolios within the organization.

Portfolio Scheduling

Portfolio Dashboard

Portfolio Planner & DashboardPlan & Manage: Schedule and Track the Portfolio

Portfolio Planner & DashboardPlan & Manage: Schedule and Track the Portfolio

Resource Surplus & Deficits

10


The UMT Portfolio Management architectureThe UMT Portfolio Management architectureModular, proven, leading-edge softwareModular, proven, leading-edge softwareThe UMT Portfolio Management architectureThe UMT Portfolio Management architectureModular, proven, leading-edge softwareModular, proven, leading-edge software

Central RepositoryTM

• SQL or Oracle Db• IIS Web Server• Thin Client

Financial (GL) Time ReportingEnterprise Integration:

Process:

Tools:

Portfolio Portfolio BuilderBuilderTMTM

Portfolio Portfolio OptimizerOptimizerTMTM

Portfolio Portfolio PlannerPlannerTMTM

Portfolio Portfolio DashboardDashboardTMTM

CreateDefine projects to deliver strategy

SelectPrioritize & optimize portfolio on rational

grounds using common currency

Phase: Plan‘Roadmap’ start & end

dates according to resource availability

ManageWorld-class PMO, track

benefits, report progress, mitigate risk

Define Drivers

Develop Project

Inventory

PrioritizeProjects

PrioritizeDrivers

Define Impact

Statements

Optimize Portfolio

Se

lec

t P

ort

foli

o

Optimize Project Schedules

Define Competencies

Project Requirements

CompetencyAvailability

Analyze Supply

vs. Demand

Reporting

Implement

Initiation

Design

Construct

Test

Gates

Sta

tus

Re

po

rtin

g Issues

Risks

CR’s

Resource

Milestone


MS Project Server Integration MS Project Server Integration Synchronising Project Update with Portfolio AnalysisSynchronising Project Update with Portfolio AnalysisMS Project Server Integration MS Project Server Integration Synchronising Project Update with Portfolio AnalysisSynchronising Project Update with Portfolio Analysis

Note: Workflow is configurable and customizable per client specification.

UMTPortfolio Manager

Microsoft Project Server

UMT Portfolio Manager™ and MS Project Server integration points:

Project ideas are entered and analyzed before being selected in the UMT Portfolio Manager and exported to MS Project

Server to enable detailed project planning (e.g., task level). Detailed project plans can be synchronized with the projects in UMT Portfolio Manager in terms of schedule data (i.e. at

the phase and milestone level only) and resource data (i.e. by competency or skill type) Resource availability data can be uploaded to the UMT Portfolio Manager from the MS Project Server, and used for

scheduling analysis UMT’s Microsoft Gateway can be used on a periodic basis to synchronize Baseline, Actual & Forecast data with UMT

Portfolio Manager for portfolio reporting and portfolio re-prioritization and optimization.


Seamless Integration with Microsoft's EPM SolutionSeamless Integration with Microsoft's EPM Solution

UMT Project Portfolio Server integrates with the EPM Solution to allow organizations to quickly deploy ‘Top Down’ portfolio analytical techniques on top of the leading enterprise

project management platform.

Executives Portfolio AnalystsProject Managers

Application Managers Project Managers

PMOsResource Managers

Team Members

Line of Business Systems

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