So what are the benefits?
Effective project portfolio management should not only show unnecessary duplications in current projects, the historic information stored can be used to help analyse just how past projects failed. Once that information has been analysed it can be used to define a set of performance indicators that can help show if a project is slipping towards failure.
Project portfolio management tools give programme managers access to a level of business intelligence that hasn't been possible with the old silo-based development process, where the information about the project management process is lost at the end of each project.
You shouldn't expect to be up and running with a project portfolio management solution overnight. Not only do you have to set up a large software implementation (along with its associated infrastructure) and the processes you need to get the most from your tools, you'll have to handle any political fallout from what is at heart a very big change to the way IT is delivered.
Results won't appear overnight, either. You'll need to collate a lot of information before you can analyse your project portfolio in depth. Primavera's ProSight has a set of Fast Track tools to help speed up implementations – though there's still a wait, with most implementations taking 45 to 90 days.
You don't need to implement all the elements of a project portfolio management solution at once. Business Engine (recently acquired by Planview) uses a component based approach. You can start with its financial component to handle financial reporting, and then add alignment tools to improve portfolio management, alongside delivery tools and methodology management. By taking a staged approach to implementing a system you can demonstrate ROI as you roll out a system, hopefully increasing buy-in from the rest of the business.
There's another upside to project portfolio management. Once your systems are in place information can be delivered a lot more quickly, so businesses can have a much closer to real time view of project spend. In the past this may have taken weeks or even months to propagate through manual systems and across the boundaries between project management and financial systems.
Tesco has been using Business Engine's tools, and has been able to reduce the amount of time taken producing reports for each of its project managers by four days a month, and it's been able to assemble budget figures three weeks earlier. With project portfolio management tools changes in anticipated spend can be seen quickly, and can be used to make decisions as soon as possible, rather than weeks after the fact.
Project portfolio management can't exist in isolation. As a methodology it demands a deeper and closer relationship between IT departments and business stakeholders. Businesses that want to use it will also need to find ways of bringing IT and business closer, using approaches like the Enterprise Architecture Council, where infrastructure, application, and operational architects meet with business architects on a regular basis.
Meetings like this help build a common understanding of the business needs, and of the IT capabilities, and can help provide the prioritisation information that effective project portfolio management needs. It's an approach that can also speed up the delivery of service-oriented architectures. ®