Use portfolios of projects to see revenue, resource assignments, and more.
What is Project Portfolio Management? You should think of project portfolios the same as investment portfolios because projects are your primary means of investing in your company. You fund a selection of projects and expect and return on investment just like in the financial world. Your special mix of projects represents a part of your intellectual property and contributes to the financial outlook of the company. In other words, the projects you choose to fund may mean the difference between success and failure.
Don’t you wish your timesheet collected this intelligence automatically?
But wait… it does.
Each project is assign to a portfolio of your choosing, and entering timesheet hours automatically gathers intelligence for that portfolio. But you have to build the list of portfolios and assign each project to one. Think of this as project portfolio management. Every project belongs to a portfolio; some portfolios have dozens of projects while others have only a few. But you decide which projects you wish to add to enrich and round out each portfolio.
If it helps… visualize a series of chemistry beakers where each beaker has a special mix of ingredients. Every beaker is different. You’re trying to determine which beaker solution performs the best without producing a massive explosion. J Each beaker represents a portfolio, and the mix of ingredients are your project choices.
Now that you’ve mixed each portfolio for maximum performance, you can sit back and monitor results.
The video describes three simple ways to use your portfolio choices.
1. Report on past performance
The pie chart in the video shows historical revenue for each project portfolio. This lets you see which portfolio performed best. In other words, how much money was realized for each mixture of projects? Some performed better than others, and all will compete for future funding and executive support. Obviously, the best performing portfolios will survive longest. You can use this chart to “A/B Test” mixtures of projects for highest return, or simply demonstrate which are your money makers. This makes a perfect board-room illustration for what you’ve been trying to say all along.
2. Report on future revenue
Just as we saw past performance in the revenue pie chart, you can also compare project portfolios for future performance. Which portfolios will yield the highest revenues? The Project Revenue window lets you explore various options to find out. Simply pick a portfolio from the list and you’ll see projected revenue out into the future. Compare portfolios, use this to inspire the Sales team, or warn of lean quarters to come. You can shore up portfolios you feel may lack expected performance.
3. Allocate project hours by portfolio
It turns out that you can use project portfolios for more than just performance charts. Managers can allocate task hours to employees on a portfolio basis. Think of this as the micro-management of project funding. You’ve already decided which projects are funded, but how are the actual hours dealt out to resources for actual work? Portfolios known to perform well are given the hours while poor performing one get what’s left. Those are the harsh realities in the trenches.
Consider using project portfolio management to learn more about your funding requirements, learn more about your past performance, and project future revenues. Remember, you are working at a higher strategic level than down at the individual projects.