This document provides an overview of project portfolio management (PPM). It discusses why organizations implement PPM to align projects with business objectives, establish governance, and maximize investments. A five-step process for successful PPM is outlined, including gathering projects, setting strategic objectives, aligning projects to objectives, scoring and categorizing projects and budgets, and actively managing the portfolio. Benefits of PPM include justifying project cancellation, balancing risk, prioritizing based on strategy, and improving communication. Challenges include gaining executive buy-in, avoiding overcomplication, relying too much on software, and the time commitment required.

1. PROJECT PORTFOLIO MANAGEMENT
PRESENTATION TO KENYA-PMP
By: Lawi Sultan Njeremani

2. CONTENT:
• Why PPM- What is PPM
• The PPM Pyramid
• Operating in the Value Zone
• Defining the Value Zone
• PPM & Resource Management
• 5-Steps to successful PPM
• Benefits & Challenges of PPM

3. • Why PPM
•Align resources with
business objectives
(Strategy)
•Build strong Governance
structure
•Ensure proper executive &
business support of projects
•Maximize investments
•Reduce No. of redundant
projects
•Make it easier to cancel
projects
•Set expectations
•Develop Plans and
Budgets

4. The PPM Pyramid
RulesPower
Culture
Goals

5. Operating in the Value Zone
The Zone
Portfolio
Management
Project
Management
Organizational
Infrastructure
& Culture

6. Defining the Value Zone
• Alignment – Do the projects
contribute to the strategic
goals of the company?
 Innovation – are we
receptive to and do we
invest in something New?
 Fit – is this project doable
with the resources we
have now?
Fit
 Value – is the value received
worth the effort?
Value
Zone

7. PPM Pyramid and the Language of
Resource Management
• The Role of Executive
Management is to Allocate
the money and the people
• The Role of Functional
Management is to Manage
the money and the people
• The Role of Project
Management is to spend
the money and support the
people
PMs and Project Teams
Functional
Management
Executive
Mgmt

8. 5-Steps to Successful Project Portfolio
Management
1. Gather a detailed inventory of
all projects
Some companies using PPM, begin
with taking a complete inventory of
current requested projects.
Other companies benefit from
starting from scratch with the
process and require that all projects
be re-requested and re-assessed
through PPM.

9. 5-Steps to Successful Project Portfolio
Management
2. Set strategic objectives for the company
+ One 3 hour meeting with all company HoDs & CEO
+ Operating Plan structure is set at 3 levels
Objectives (Why?)
Initiatives (What?)
Projects (How?)
+ Objectives are brainstormed and decided upon in this
meeting with all attendees prepared with 3-5
recommended objectives.
+ Discussion serves as kick-off to next year and a
chance to openly, informally discuss company strategies
and challenges.

10. 5-Steps to Successful Project Portfolio
Management
2. Set strategic objectives for the company… Continued
+HoD’s brainstorm initiatives in support of the objectives with direct reports
(Supervisors and Team Leaders) within their department.
+Another 3 hour meeting is held with all HoD's and direct reports to review all
recommended initiatives by department. Initiatives are discussed and agreed
upon in this meeting.
+A good amount of cleanup is required on this list after the meeting (deleting
duplicates, merging similar initiatives, etc.
+Finalized list is distributed to all HoD's and direct reports.
+Involvement of direct reports at this level serves the purpose of generating
early buy-in to the Operating Plan process by senior management.

11. 5-Steps to Successful Project Portfolio
Management
3. Align projects with objectives
1. HoD’s and their direct reports are responsible for recommending projects that will
support each initiative in alignment with the company objectives.
2. Only HoD approved projects are entered into the system, cutting down drastically
on frivolous project requests.
3. Each project entry requires a high level justification including project
description, business benefits, executive sponsor, business manager, estimated
quarter of completion, etc.
4. The projects are then assigned owners and estimate costs are established
5. All proposed projects are then reviewed in individual departmental meetings
chaired by the CEO together with Head of Finance with attendees being the
department VP and their direct reports.
6. Department VP’s and direct reports are given this opportunity to introduce the
project and “sell” it to the chairs for approval.

12. 5- Steps to Successful Project Portfolio
Management
4. Score and categorize projects & Budget
During the project review meetings, each project is assessed based on
strength of support for initiative/objective, estimated business benefits, and
estimated costs.
As a closing to the discussion on each project, the project is assigned a status
and an action level.
The action level is assigned first and drives the status and next steps, as
outlined below:
Action Level: Status: Next Steps:
1. Start Project Accepted Begin projects in order of priority
2. Start after validation* Proposed Begin validation process
3. More research needed Proposed Continue research and propose again
4. Unlikely to start this year Proposed Hold (candidate for Q4 if resources allow)
5. Do not start this year Deferred Hold for next year and propose again

13. 5- Steps to Successful Project Portfolio
Management
4. Score and categorize projects & Budget……continued
+After all projects are reviewed and scored, the HoD’s are tasked with
prioritizing all action level 1 and 2 projects for their department. The priorities
are simply high, medium and low.
+The Operating Plan is then handed over to the respective Head of Portfolio
to schedule all action level 1 and 2 projects that require Portfolio support into
the four quarters of the year with estimated start and complete quarters. This
scheduling is based on priority and action level with the high priority, action
level 1 projects at the top. Resource leveling is done at this time.
+This schedule is the first draft of the respective plan for the coming year. It is
then tweaked as needed when looked at on paper for anomalies, special
considerations, etc. This schedule will also become the basis for the
respective Portoflio budget.

14. 5- Steps to Successful Project Portfolio
Management
5. Actively manage portfolio
Monthly Steering Committee (Executive Committee) chaired by CEO.
Members of committee include CEO, CFO and Head of Investment. All other
HoD’s attend as needed based on agenda of items to be discussed.
Purpose of committee:
Business owners and HoD’s present projects requiring validation before approval.
Steering Committee approves or denies these projects.
Monthly status given on large-scale, strategic projects from the Operating Plan.
Provides forum for strategic spending decisions and updates on critical system
issues/concerns.
Provides forum for reprioritizing projects based on mid-year changes in company
priorities/strategies.

15. 5- Steps to Successful Project Portfolio
Management
5. Actively manage portfolio… continued
Quarterly review of entire Operating Plan at standing Executive Committee
meetings. All HoD’s are required to give status of initiatives and projects
quarterly.
Quarterly review by CEO of high-level Operating Plan at Board of Directors
Meetings.
“Portfolio Management without governance is an empty concept”

16. PPM PROCESS SUMMARY

17. BENEFITS OF PPM
1. Justifies “Killing” projects that don’t support Company strategy
2. Balances Risk across projects
3. Prioritizes project proposals across a common criteria rather than emotions
or politics
4. Allocates resources to projects that align with strategic direction
5. Improves Communication and supports agreement on project goals
6. Builds discipline into project selection process
7. Provides Executive oversight of Company
8. Provides the structure/process for project portfolio Governance and avoids
waste/duplication

18. CHALLENGES OF PPM
Team: Many executives are initially uncomfortable having their decisions
scrutinized. It requires real teamwork at the executive level to support portfolio
management and governance. Executive buy-in is absolutely required up front.
Complexity: The desire to overcomplicate this process with complex scoring
and red tape is overwhelming. Keep it simple at first then improve upon the
process as participants become familiar with the steps.
Software: Do not rely on project portfolio management tools to manage this
process for you. No one tool does everything and many tools complicate the
process. Sage wrote their own tool in an attempt to keep it simple.
Time: This requires an additional time commitment from Executives above and
beyond their usual constraints. Coming to meetings prepared is the key to
keeping this process time sensitive.

19. THANK YOU FOR YOUR PATIENCE
VELOCITY
Project Management
http://www.velocityprojectmanagement.com/