In ancient warfare, the difference between winning and losing a battle was sometimes as simple as not breaking rank. A unit out of alignment could not protect itself or direct its energy in the right direction. The same survival principle applies to project portfolio management’s ability to align the organization. In an article for CFO.com, Mark A. Langley, President and CEO of the Project Management Institute, discusses how to better manage a project portfolio.
Strategy in Action
Project portfolio management is “evaluating, selecting, balancing, and resourcing projects and programs that are aligned with strategy.” It is a CFO’s best friend when they want to make an impact. Organizations that have mature portfolio management practices are twice as successful as their peers. Incidentally, 18 percent of organizations that practice portfolio management do it from their CFO’s office.
Portfolio management is more than the mere context of programs and projects. Portfolio management goes beyond this to connect these projects to the business strategy. Organizations who fail to do this are truly missing out on all the benefits portfolio management has to offer. Deciphering this is extremely important to CFOs, because the decision might fall on them to decide what initiatives will make the most sense for the organization.
Before actions and decisions can take place, there needs to be the right knowledge, or “sufficiently detailed strategy with clear criteria.” Putting the right metrics in place allows for micro-monitoring, which is not to be confused with micro-managing:
[Micro-managing] is tempting, because it can provide a sense of involvement and control, but really it’s a distraction and a misuse of resources. By contrast, micro-monitoring is paying attention to the right things with the appropriate level of involvement, understanding the difference between vigilance and meddling, and being prepared to take action only when needed.
In order to make all this work, a CFO should coordinate with the PMO.
“Success” and “failure” are subjective terms that do not always indicate what needs to be said. What really needs to be looked at is the implication on the overall strategy. Good portfolio management means knowing when to delay or cancel a project because it is the best thing for the organization overall. Imagine a project that no longer aligns with the organization’s strategy; why would they keep it going?
CFOs, along of course with CIOs, have the unique opportunity to help the company align portfolio management and business strategy. Do this successfully, and the organization will reap rewards. You can read the original article here: http://ww2.cfo.com/business-planning/2016/02/optimize-project-portfolio-management/