Project Portfolio Management

1. Project Portfolio Management

2. Setting the correct priorities in the project environment as well as controlling and mastering the Project Risks

3. Strategic vs. operational Management? Content vs. organisational context? Terms & Definitions „Program-Management“ „Project Portfolio-Management“ „Multiproject-Management“

4. Agenda • Motivation and Targets • The responsibility for the project portfolio • Branches of the portfolio-management • Facilities • Abstract & critical factors for success

5. Incentive based on anticipated definaces • Consistent with the business strategy • Exposure to „sacred cows “ • Assessment and prioritization of projects • Determination of the operational risk • Utilization of key personal

6. Incentive based on operative defiances • „We don‘t want to just react, we want to • approach problems in a proactive manner“ • „We don‘t know the state of the projects“ • „We don‘t know how delays and changes to one project influence other projects “ • „We just want to take care above all about the critical and problematic projects“

7. Agenda • Motivation and Targets • The responsibility for the project portfolio • Branches of the portfolio-management • Facilities • Abstract & critical factors for success

8. Different roles in the company organization structure Company Management Strategy Change Manager ProjectPortfolio Manager Design Authority Portfolio Projects Project Portfolio QA Project Portfolio Support Steeringcommittee Operation ProjectQA Project Support Projectmanager Team

9. „Candidates“ for the Project Portfolio Management • Manager in charge (in project organizations) • Official Program-Executive • Staff position (e.g. Organization development) • Member of the executive board (e.g. CFO)

10. Agenda • Motivation and Targets • The responsibility for the project portfolio • Branches of the portfolio-management • Facilities • Abstract & critical factors for success

11. Branches of the Project Portfolio Management Corporate Strategy OpportunityManagement PriorityManagement Risk & ProblemManagement Quality-Management & Audit ConfigurationManagement StakeholderManagement Managementdisciplins in the Project Portfolio Controlling Planning Projectmanagement Dimensions Time Costs ResultQuality Resources

12. Adjustment of strategic vs. economic importance Total Portfolio consideration Projects Project Portfolio Strategic Importance StrategicImportance p1 p2 Adjustment through „Expansion“ and „Compression“ Economic Importance [€/$] Strategic Importance Total utility p1 Economic Importance [€/$] p2 Economic Importance [€/$]

13. Priority ManagementDoing the correct thing correctly! • Recognize Strategy conformance Target-Prioritization • Recognize deviations of the Actual -Situation  Controlling • Traceability Conflict reduction ProjectImportance • Risk Assumption Opportunity Costs Prioritization Deficiency Project xy Aktual Priority Strategy Conformance Matrix (SCM)

14. Basics for the Assessment of the SCM Strategy Paper Intangible assets Business Plan Project importance Balanced Scorecard Project Business Cases Tangible assets IAOC Actual Priority Project progress on schedule Management Awareness Resource Dedication Appropriated Budget

15. How does a project xy influence the customer business? Inquiry of the strategic importance of projects(1) Balanced Scorecard with targets and measurement categories Customer Perspective Internal Processes • Which part contributes project xy to the reduction of time and costs? Innovation • Which innovation targets are addressed by project xy?

16. # Category Indicator Measurement Categoryv Strategic importance 1 Client Strategy Customer count increase Number of new clients 2 Client Strategy Product density Number of products per clients 3 Client Strategy Intensity of customer relationship Number of transactions per client / year 4 Effectiveness & Efficiency Web-based presence Portion of web-based processes 5 Effectiveness & Efficiency Process improvement external Portion of swaped out process steps 6 Effectiveness & Efficiency Process improvement internal Quality- and time-saving index 7 Effectiveness & Efficiency Leverage from/to other units Leverage Index 8 Accomplishments & Communication Provide leading instruments Platform Enhancement Index Inquiry of the strategic importance of projects (2) Pragmatical chance assessment based on BSC-Indicators Weight 100% 10% 15% 15% 10% 10% 15% 10% 15% Chacteristics per Project and Indicator: No Impact Minor Impact Large Impact Core Target

17. Overview Project Portfolio (1)Projects Project Importance 2 1 3 5 9 8 6 4 7 Actual Priority Declarations: - The size of a circle constitutes the estimated project expenses (Costs and Time) - The color constitutes the affiliation of the project to a certain context.

18. Overview Project Portfolio (2) Factual Dependencies Project Importance 2 1 3 5 9 8 6 4 7 Actual Priority Declarations: Connections between projects: Interdependencies and influences (red = negative, green = positive, black = neutral/not yet clear)

19. Overview Project Portfolio (3) Personnel Dependencies Project Importance 2 1 3 5 9 8 6 4 7 Actual Priority Declarations: Conflict situation between projects based on planned resources

20. Overview Project Portfolio (4)Time Dependencies ProjectImportance 2 1 3 5 9 8 6 4 7 Actual Priority Declarations: Time coherences (e.g. Completion of project 4 is prerequisite for project 5)

21. Overview Project Portfolio (5)“Green Region” = Strategy Conformity Project Importance 2 1 3 5 9 8 6 4 7 Aktual Priority

22. 1&2 3  4’ 8  Overview Project Portfolio (6)Arrangements ProjectImportance 2 1 3 5 10 9 8 6 4 7 Aktual Priority

23. Portfolio Targets Recognize and assess risks Data/ Information Improvement of the Risk Management Risk Management Strategy Risk Management Process Risk Monitoring Risik and Problem ManagementThe Process

24. Risk and Problem ManagementThe necessity of an assessment P R O J E C T M A N A G E M E N T R I S K PROJECT INTEGRATION (PROJECT OFFICE) SCOPE TIME COST QUALITY HUMAN RESOURCE COMMUNICATION RISK PROCUREMENT P R O D U C T L I F E - C Y C L E R I S K DEVELOPMENT PLANNING & INITIATION REQUIREMENTS ANALYSIS DESIGN TESTING IMPLEMENTATION & ROLLOUT POST IMPLEMENTATION P R O J E C T S U P P O R T R I S K PROGRAMME OFFICE INTEGRATION WITH COMMON BUSINESS FUNCTIONS P R O J E C T E N V I R O N M E N T R I S K STRATEGIC ALIGNMENT STAKEHOLDERS CORPORATE CULTURE PORTFOLIO MANAGEMENT BUSINESS ENVIRONMENT (ORG) PROCESS ALIGNMENT

25. Frequent indicators for Project risks... • Artificial pressure of time: „Without pressure of time nothing will proceed anyways ...“ • Planning is based on a perfect world: • „Key person xy was absorbed by another project ...“ „The Project members were rolled over by the day-to-day business...“ • Project Management by Hope: • „There should be nothing to intervene ...“ • „We do not have any time buffer ...“ • „We do not have any time for a detailed planning...“

26. Crisis Management Measure of damages Reduce Accept Insure Ignore Control Probability of occurrence Develop a Risk strategy

27. Significance 3 2 6 4 5 7 1 Likelihood The basis of the Risk Management processes in a complex environment Risk Tracking Risk Mapping Risk Management Report Aktual and adopted Project plans (Aktivities, Deliverables) Observations Interviews Supply object list & Milestone control Effort Controlling Status reports of the Projects Combined open issue lists on the program management level

28. Having the sight on the benefit The active dialog about the project risks improves the creation of awareness of the project members involved The established Risk-Management-Process serves as an early waring system Through the realization of the proposed measures the risks will be reduced in the appropriate manner The risk dialog forces the dealing with unrealistic project defaults( costs, time,resources, technical feasibility) at the management level Basis for the cockpit-function at the project portfolio level

29. The Controlling-CycleContents of the reporting Precense oriented  aktual state of the project Little effort for project and portfolio managers Professional degree of performance (percental) Accumulated Costs (nominal, percental) Combined from single project reports, concentration on the essential Planning deviations with rationals Options for problems, risiks and solutions Planned steps up to the next report

30. Agenda • Motivation and Targets • The responsibility for the project portfolio • Branches of the portfolio-management • Facilities • Abstract & critical factors for success

31. COMPONENTS • Organization • Plans • Controls • Stages • Management of Risk • Quality in a Project Environment • Configuration Management • Cange Control • PROCESSES • Strating Up A Project • Initiating A Project • Directing A Project • Controlling A Stage • Managing Product Delivery • Managing Stage Boundaries • Closing A Project • Planning • TECHNIQUES • Product-Based Planning • Quality Reviews • Change Control Approach • Project Filing • Plus: • Exisiting techniquesalready in use. Business Case for the Project Existing Company Systems & Procedures ? (ISO 9000) ? Literature reference: PRINCE 2 (Project- / Portfoliomgmt.)Central Computer and Telecommunication Agency CCTA

32. Tools Tool characteristics • Project Management Suites • Process Management Software • Schedule Management Software • Cost Management Software • Resource Management Software • Communications Mgmt. Software • Risk Management Software But remeber:„A fool with a tool is still a fool...“

33. Software-supported Portfolio Management:Example : IACO Assessment Easy to generate and handle

34. Software-supported Portfolio Management:Example : IACO Assessment cont‘d Project & process initilization and descriptions at a glance

35. Software-supported Portfolio Management:Example : IACO Assessment cont‘d Single sheets for each subsystem

36. Software-supported Portfolio Management:Example : IACO Assessment cont‘d See the rating and interaction for each system at ones

37. Software-supported Portfolio Management:Example : IACO Assessment cont‘d Set your individual dependencies and see the resulting relations without reassessment

38. Software-supported Portfolio Management:Example : IACO Assessment cont‘d Have an overview on all of your Systems in relation to eachother

39. 1 2 3 4 5 Flow Chart Description Responsibilities Frequency Input Output 6 7 8 1 2 3 4 5 6 7 8 Support Material:Simple Process diagrams – on one page! Flow chart, supplemented with detailed descriptions, definitions of the responsibilities , Frequency, Inputs and Outputs Process Diagram Customer Logo

40. Agenda • Motivation and Targets • The responsibility for the project portfolio • Branches of the portfolio-management • Facilities • Abstract & critical factors for success

41. Critical Success factor # 1:The „Cultur compatibility“ Exaggerated Formalism Paper and Document flood, bureaucracy Little usable content in the documentation How do I bypass the process? Therefore Recognize Quick wins • Align the proceedingon the currentproblem definition

42. Further Success Factors Management Commitment • Exemplify and the will for enforcement Transparent communication as a chance • The project protfolio is of interest to all No imaginary assessment accuracy • Most modells require information, which doesn‘t exist in reality The courage to decide • The transparent portfolio management makes clear that some management decsicions have to be made (e.g. to cancle projects)