Project portfolio management (PPM) is the centralized management of the processes, methods, and

technologies Technology is the application of knowledge to reach practical goals in a specifiable and reproducible way. The word ''technology'' may also mean the product of such an endeavor. The use of technology is widely prevalent in medicine, science, ...

used by

project manager A project manager is a professional in the field of project management. Project managers have the responsibility of the planning, procurement and execution of a project, in any undertaking that has a defined scope, defined start and a defined ...

s and

project management office A project management office (abbreviated to PMO) is a group or department within a business, government agency, or enterprise that defines and maintains standards for project management within the organization. The PMO strives to standardize and in ...

s (PMOs) to analyze and collectively manage current or proposed projects based on numerous key characteristics. The objectives of PPM are to determine the optimal

resource Resource refers to all the materials available in our environment which are technologically accessible, economically feasible and culturally sustainable and help us to satisfy our needs and wants. Resources can broadly be classified upon thei ...

mix for delivery and to

schedule A schedule or a timetable, as a basic time-management tool, consists of a list of times at which possible tasks, events, or actions are intended to take place, or of a sequence of events in the chronological order in which such things are ...

activities to best achieve an organization’s operational and financial goals, while honouring constraints imposed by customers, strategic objectives, or external real-world factors. Standards for Portfolio Management include

Project Management Institute The Project Management Institute (PMI, legally Project Management Institute, Inc.) is a U.S.-based not-for-profit professional organization for project management. Overview PMI serves more than five million professionals including over 680,0 ...

's framework for project portfolio management, Management of Portfolios by

Office of Government Commerce The Office of Government Commerce (OGC) was a UK Government Office established as part of HM Treasury in 2000. It was moved into the Efficiency and Reform Group of the Cabinet Office in 2010, before being closed in 2011. Overview A ''Review of ...

and the PfM² Portfolio Management Methodology by the PM² Foundation.

Key capabilities

PPM provides program and project managers in large, program/project-driven organizations with the capabilities needed to manage the time, resources, skills, and budgets necessary to accomplish all interrelated tasks. It provides a framework for issue resolution and

risk mitigation Mitigation is the reduction of something harmful or the reduction of its harmful effects. It may refer to measures taken to reduce the harmful effects of hazards that remain ''in potentia'', or to manage harmful incidents that have already occur ...

, as well as the centralized visibility to help planning and scheduling teams to identify the fastest, cheapest, or most suitable approach to deliver projects and programs.

Pipeline management

Pipeline management involves steps to ensure that an adequate number of project proposals are generated and evaluated to determine whether (and how) a set of projects in the portfolio can be executed with finite development resources in a specified time. There are three major sub-components to pipeline management: ideation, work intake processes, and Phase-Gate reviews. Fundamental to pipeline management is the ability to align the decision-making process for

estimating Estimation (or estimating) is the process of finding an estimate or approximation, which is a value that is usable for some purpose even if input data may be incomplete, uncertain, or unstable. The value is nonetheless usable because it is der ...

and selecting new capital investment projects with the strategic plan.

Resource manager

The focus on the efficient and effective deployment of an organization’s resources where and when they are needed. These can include financial resources, inventory,

human resources Human resources (HR) is the set of people who make up the workforce of an organization, business sector, industry, or economy. A narrower concept is human capital, the knowledge and skills which the individuals command. Similar terms includ ...

, technical skills, production, and design. In addition to project-level resource allocation, users can also model ‘ what-if’ resource scenarios, and extend this view across the portfolio.

Change control

The capture and

prioritization Prioritization is the activity that arranges items or activities in order of importance relative to each other. In the context of medical evaluation it is the establishment of the importance or the urgency of actions that are necessary to prese ...

of change requests that can include new

requirements In product development and process optimization, a requirement is a singular documented physical or functional need that a particular design, product or process aims to satisfy. It is commonly used in a formal sense in engineering design, inclu ...

, features, functions, operational constraints, regulatory demands, and technical enhancements. PPM provides a central repository for these change requests and the ability to match available resources to evolving demand within the financial and operational constraints of individual projects.

Financial management

With PPM, the Office of Finance can improve their accuracy for estimating and managing the financial resources of a project or group of projects. In addition, the value of projects can be demonstrated in relation to the strategic objectives and priorities of the organization through financial controls and to assess progress through earned value and other project financial techniques. It is an important part.

Risk management

An analysis of the risk sensitivities residing within each project, as the basis for determining confidence levels across the portfolio. The integration of cost and schedule risk management with techniques for determining contingency and risk response plans, enable organizations to gain an objective view of project uncertainties.

Evolution of PPM

In the early 2000s, many PPM vendors realized that project portfolio reporting services only addressed part of a wider need for PPM in the marketplace. Another more senior audience had emerged, sitting at management and executive levels above detailed work execution and schedule management, who required a greater focus on process improvement and ensuring the viability of the portfolio in line with overall strategic objectives. In addition, as the size,

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, complexity, and geographical spread of organizations’ project portfolios continued to grow, greater visibility was needed of project work across the enterprise, allied to improved resource utilization and capacity planning.

Enterprise project portfolio management

Enterprise project portfolio management (EPPM) is a top-down approach to managing all project-intensive work and resources across the enterprise. This contrasts with the traditional approach of combining manual processes, desktop project tools, and PPM applications for each project portfolio environment.

Business drivers for EPPM

The PPM landscape is evolving rapidly as a result of the growing preference for managing multiple capital investment initiatives from a single, enterprise-wide system. This more centralized approach, and resulting ‘

single version of the truth In computerized business management, single version of the truth (SVOT), is a technical concept describing the data warehousing ideal of having either a single centralised database, or at least a distributed synchronised database, which stores all ...

’ for project and project portfolio information, provides the transparency of performance needed by management to monitor progress versus the strategic plan. The key aims of EPPM can be summarized as follows: *Prioritize the right projects and programs: EPPM can guide decision-makers to strategically prioritize, plan, and control enterprise portfolios. It also ensures the organization continues to increase

productivity Productivity is the efficiency of production of goods or services expressed by some measure. Measurements of productivity are often expressed as a ratio of an aggregate output to a single input or an aggregate input used in a production proces ...

and on-time delivery - adding value, strengthening performance, and improving results. *Eliminate surprises: formal portfolio project oversight provides managers and executives with a process to identify potential problems earlier in the project lifecycle, and the visibility to take corrective action before they impact financial results. *Build contingencies into the overall portfolio: flexibility often exists within individual projects but, by integrating contingency planning across the entire portfolio of investments, organizations can have greater flexibility around how, where, and when they need to allocate resources, alongside the flexibility to adjust those resources in response to a crisis. *Maintain response flexibility: with in-depth visibility into resource allocation, organizations can quickly respond to escalating emergencies by maneuvering resources from other activities, while calculating the impact this will have on the wider business. *Do more with less: For organizations to systematically review project management processes while cutting out inefficiencies and automating those workflows and to ensure a consistent approach to all projects, programs, and portfolios while reducing costs. *Ensure informed decisions and governance: by bringing together all project collaborators, data points, and processes in a single, integrated solution, a unified view of project, program, and portfolio status can be achieved within a framework of rigorous control and governance to ensure all projects consistently adhere to business objectives. *Extend

best practice A best practice is a method or technique that has been generally accepted as superior to other known alternatives because it often produces results that are superior to those achieved by other means or because it has become a standard way of doing ...

enterprise-wide: organizations can continuously vet project management processes and capture best practices, providing efficiency as a result. *Understand future resource needs: by aligning the right resources to the right projects at the right time, organizations can ensure individual resources are fully leveraged and requirements are clearly understood. EPPM software also allows an organization to establish complete project capacity.

Project portfolio optimization

A key result of PPM is to decide which projects to fund in an optimal manner. Project Portfolio Optimization (PPO) is the effort to make the best decisions possible under these conditions.