Do you have an idea on how to measure the value of your projects? And do you know how to select value-adding projects that fit your strategy? The answer is likely no, not really. In our experience, organizations have difficulties keeping track of all the different initiatives that are going on within the company and could improve their project portfolio management. Sustaining a value-adding project portfolio is an important practice, but we often see organizations struggle with it. The consequence of not streamlining your total project portfolio is that management decisions are not made based on the added value of projects for the organization and might therefore not be optimally using its limited resources. Let me explain some of the common pitfalls in project portfolio management and what you can do to manage your portfolio well.
Putting the pieces together
Organizations often have many different projects going on at the same time. A common pitfall is that projects overlap or conflict, whereas the goal should be to create synergies. In other cases, projects take longer than expected. This takes more resources and leads to results that might be outdated due to a continuously changing market. Organizations are putting all their capacity in ongoing projects to sustain them while new and potentially more beneficial projects are laid aside.
It’s all about size, cost, risk, and timing
In the process of selecting new projects, too much emphasis is sometimes placed on whether it proves to be a successful business case. From a portfolio perspective, this sounds great. However, maybe your organization’s capacity for change shows you will only be able to do one project at a time. This might change the whole debate about managing a portfolio as other departments won’t be able to do their project. A successful business case might be ignored in favor of another project. Hence, only looking at a positive business case is not enough. Similarly, a very strong business case is sometimes ignored because of conflict with more sensitive organizational change. Projects that strongly affect an organization’s employees or cause big changes for clients are high risk. Risk, together with size, cost and implementation time of the project are important to consider when evaluating whether to go ahead with a project or not.
Time to take project portfolio management more seriously
A complex mix of these challenges, which often enhance each other, results in reduced value for your organization. A focused project portfolio approach helps your organization to decrease project costs and increase the focus on real value. Good portfolio management is essential for maximizing the use of your resource capacity by only allocating them to the most beneficial projects in line with your strategy. It provides organizations with a structured approach to continuously reprioritize projects and stop wasting money on time. It enables faster decision making by having a better overview of your organization by presenting critical project information in a very simple way. Focused project portfolio management leads to project acceleration, allowing more time for stakeholder involvement. All together, we can build short-term solutions with the longer-term vision in mind.
Capgemini has built a strong track record in value-based project portfolio management. We evaluate and analyze how your current projects perform and if they still create the value which is desired. In three steps we help you to identify, select, and assess the value of your project portfolio. Contact Eva Lo-van Steenbergen if you want to learn more by clicking here.
This blog is co-written by Suzanne Mooren.