Portfolio management


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It is a brief overview presentation on portfolio management. It gives a brief idea of what Portfolio Management is and also specifies the processes as mentioned in OGC's Management of Portfolio and PMI's PfMP.

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Portfolio management

  1. 1. PM Footprints – Project Portfolio Management Niladri Mallick Choudhuri 16 January 2014 1
  2. 2. Agenda Project Portfolio Management Definition Portfolio – Program - Project Portfolio Management and Corporate Governance Portfolio Management, Strategy and Operations Portfolio Management Strategy Portfolio Management Model Portfolio Management Process Presentation Title 2
  3. 3. SPPM Workshop - Definition What is Portfolio? As per PMI – A Portfolio is a collection of Projects or Programs and other work that are grouped together to facilitate effective management of that work to meet strategic business objectives. The Projects or Programs of the Portfolio may not necessarily be interdependent or directly related. These components of a Portfolio are quantifiable; that is, they can be measured, ranked and prioritized. As per OGC – An organization’s portfolio is the totality of its investment (or segment thereof) in the changes required to achieve its strategic objectives. What is a Portfolio Management As per PMI – Portfolio Management is the coordinated management of Portfolio Components to achieve specific organizational objectives. As per OGC – Portfolio Management is a coordinated collection of strategic processes and decisions that together enable the most effective balance of organizational change and BAU. 3
  4. 4. Portfolio – Program – Project Business Strategy: The approach or line to take, designed to achieve a longterm aim. Strategies can exist at different levels in an organization Strategy Portfolio: Overall collection of the organization’s grouping of high-level initiatives and their respective projects. Portfolio Program 1 Project A Project B Source: Gartner Program 2 Project C Project D Project E Project: A project is a temporary endeavour undertaken to create a unique product or service. Projects are temporary (characterized by a definite beginning and a definite end) and unique (the product or service is different in some distinguishing way from all other products or services). Program: A set of projects that have a common objective and interdependencies that need to be managed. A set of interrelated and interdependent projects. Source: Project Management Institute Source: Project Management Institute 4
  5. 5. Portfolio Management and Corporate Governance Relationships among Portfolio Management and Organizational Governance: Organizational Governance Strategic Planning Management by Projects Portfolio Management Program Management Management of Operations Project Management Process Tools and Metrics 5
  6. 6. Portfolio Management, Strategy and Operations Relationships among Portfolio and Strategy The ultimate goal of linking Portfolio management with organizational strategy is to establish a balanced, executable plan that will help the organization to achieve its goals. The impact of the portfolio plan upon strategy is attained by the five areas:  Maintain Portfolio Alignment  Allocating Financial Resources  Allocating Human Resources  Measuring component contributions  Strategic Risk Management Relationship between Portfolio Management and Operations The day to day functioning of the organization will continue. Portfolio management will impact multiple functional units in the organization. There may be operational budget constraints affected by portfolio or vice versa. 6
  7. 7. Portfolio Management, Strategy The framework supports the execution of strategy and drives the alignment between strategy, operations, and risks Governance & Risk Management L e a r e r s h i p 2. Translate the Strategy 1. Develop the Strategy Strategic Plan 3. Align the Organization 6 Test & Adapt f o r E x e c u t i o n Risk 4 Plan Operations 5 Monitor & Learn Operating/Financial Plan C h a n g e M a n a g e m e n t Process Execution Project & Portfolio Management 7
  8. 8. Project Portfolio Management Detailed Model Strategic Planning Business Unit Planning Pre-Assessment A N Project N Portfolio Management U A L Unapproved Quarterly Unapproved Out of Capacity New Projects Screened In-Progress Projects On-Hold Projects Portfolio Screening Project Scoring Portfolio Ranking Portfolio Simulation Approved and not Resourced Approved Project Management Portfolio Monitor Monthly Cancelled In-Progress Projects On-Hold Projects Post Audit Complete 8
  9. 9. Portfolio Management Process Portfolio Management Process can be divided in two parts: As per OGC  Portfolio Definition Processes  Portfolio Delivery Processes As per PMI  Aligning Process Group  Monitoring and Controlling Process Group 9
  10. 10. Portfolio Management Process  Portfolio Definition Processes  Understand  Categorize  Prioritize  Balance  Plan  Portfolio Delivery Processes  Management Control  Benefits Management  Financial Management  Risk Management  Stakeholder Engagement  Organizational Governance  Resource Management 10
  11. 11. Portfolio Management Process  Aligning Process Group  Identify Components  Categorize Components  Evaluate Components  Select Components  Identify Portfolio Risk  Analyze Portfolio Risk  Prioritize Components  Develop Portfolio Risk Response  Balance Portfolio  Communicate Portfolio Adjustments  Authorize Components 11
  12. 12. Portfolio Management Process  Monitoring and Controlling Process Group Management Control  Monitor and Control Portfolio Risks  Review and Report Portfolio Performance  Monitor Business Strategy Changes 12