In order to stay competitive, today’s top management is confronted with the critical task of analyzing and improving the ability of an organization to change, survive, and grow in this complex and changing global economy.
Organizations have thus been moving from operations and business as usual, to implementing change through project management as part of their competitive strategy. The ability to successfully execute projects is what drives the realization of intended benefits and the achievement of business objectives.
Organizations that execute projects successfully employ effective Project Portfolio Management (PPM) practices as a tool to manage and drive change. Given the strategic impact that projects have on business, organizations must follow effective PPM processes that capitalize on innovation; measure progress, value, and risks; and confirm that the right projects can be delivered in alignment with organizational strategy
We at Daptiv conducted a survey to examine the challenges faced by today’s businesses now that increased scrutiny over budgets (aka “doing more with less”), efficiency and effectiveness are key factors of successful organizations. The survey’s main objective was to identify current trends in PPM, and pinpoint the characteristics of PPM that are applied in higher-performing organizations. This survey was conducted among 300 project managers and senior executives attending the PMXPO Conference. Some of the key inferences from the survey were:
Why do product managers and senior executives take on PPM and implement software to support it? According to our survey, their top reasons (in order) are prioritizing projects, gaining visibility into live projects, planning and preparing for future projects, and managing cost and resources. A whopping 62% answered “all of the above”. This makes obvious that PPM is providing a lot more value than simply improving project execution.
Assessing the current adoption of Project Portfolio Management across sectors, the survey revealed that 64 percent of the respondents use PPM tools to manage their general IT projects while the remaining respondents deployed PPM solutions for compliance, product development, training and mobile related projects.
While establishing and communicating projects goals to the project management team can assist in the identification of project risks and constraints that may impede the achievement of those departmental goals, limiting the scope of project portfolio management tools within an organization can have rippling side-effects in the overall achievement of organizational goals. According to PMI’s 2012 Pulse of the Profession In-Depth Report: Portfolio Management Report, the majority of portfolio managers in highly effective organizations spend 75 percent or more of their time on portfolio management. The report further indicates that in organizations where managers focus on strategic as well as departmental goals, 70 percent of projects meet or exceed their forecasted ROI, compared to 50 percent at organizations where managers rarely focus on strategic goals.
Another interesting fact that came from the survey was that 76 percent of the respondents still use homegrown spreadsheets internally to manage projects in some capacity. Since 55 percent of respondents have more than 1,000 employees, this can easily lead to PPM data integrity issues and ponderously slow feedback loops. Definitely not a path that enables firms to pivot with rapidly changing business conditions. Moreover, from our experience this manual approach significantly impacts project performance. Today’s organizations need to see and trust information as it develops to make decisions that will help them outpace their competition.
While the BYOD movement is taking corporations by storm, our survey found that nearly 75 percent of respondents are not applying PPM techniques or software to their rollouts of smartphones and tablets. IDC recently forecasted that by 2017, total PCs are expected to drop to 13 percent, while tablets and smartphones will contribute 16.5 percent and 70.5 percent respectively. Considering the BYOD trend is only going to gain momentum in the near future, IT needs to get on the bandwagon and start actively managing this effort. Such forward-thinking strategic project planning transforms organizations from defensive and reactive to proactive and dynamic.
One of the key qualifications of a project is that it has a definite start and a definite end, though “ending” a project with a proper close-out process would appear to be an after-thought. Our survey revealed that 24 percent of the respondents do not conduct project reviews at all. That is a big number considering that of those who do, only 15 percent find they are meeting their project targets. The very last part of the project life-cycle it is often ignored even by large organizations, especially when they operate in multi-project environments. When the project is delivered, the closeout phase must be executed as planned. It plays a crucial role in sponsor satisfaction since it can create a lasting impression.
These findings are consistent with what we’ve experienced in our PPM consulting engagements. For many businesses, elements of PPM may already exist, but in non-linear and disjointed fragments. The most important factor in the success of PPM is aligning the portfolio with organizational strategy. The positive effects of strategic alignment lead to higher levels of project and portfolio performance, and increases stakeholder satisfaction with their organization’s project portfolio management practices at all levels of portfolio scale and complexity.
To know about the survey results, click here.