5 Arguments for Your Project Portfolio Management

WHY YOU SHOULD USE PROJECT PORTFOLIO
MANAGEMENT AT YOUR COMPANY
The aim of Project Portfolio Management (PPM) is that you
are working on the right projects at your company. Usually,
various projects are competing for resources such as bud-
gets and staff. Plus, projects have an impact on each other.
Often, they are interdependent or even rule each other out.
The challenge for PPM is finding the optimal combination of
projects to implement for the portfolio. At the same time,
other factors require consideration. These are strategic rel-
evance, cost, staff requirements, and deadlines that have to
be taken into account by the stakeholders.
Convince your decision-makers to adopt integrated project
portfolio management. Use the following five arguments.

Note on PPM Terminology: Often, the acronym PPM is used for the term project portfolio management. In the context of Microsoft solutions, this can lead
to misunderstandings. After all, Microsoft uses the identical acronym “PPM” for its solution “Project & Portfolio Management”, which is based on Microsoft
Project Server. This platform’s primary use is operational project management. As of Version 2010, it also includes portfolio management capabilities. This
document uses “PPM” as an acronym for project portfolio management.
1. DECIDING ON THE RIGHT PROJECTS
An integrated PPM has a decided advantage. It supports
you in selecting the “right” projects out of a portfolio of col-
lected ideas. The challenge is to evaluate these ideas as well
as select and implement feasible and economically viable
projects.
You will find the projects promising the best results per Euro
spent. At the same time, you ensure all selected projects
are aligned to business strategy.
With arbitrary project selection, you certainly risk imple-
menting the wrong projects.
The Benefit for Your Decision-Makers: They will al-
ways have the best possible decision-making basis
available. It will allow them to determine which addi-
tional projects can be started and actually carried out.
The likelihood of successful project completion will in-
crease considerably.
FIGURE 1: MOST RESOURCES TO THE MOST IMPORTANT PROJECTS
2. COMPLETE OVERVIEW OF PROJECT PORTFOLIO
PPM enables you to find quick answers to your questions:
1. Which projects are currently in what phase?
2. Which new projects are up for decision?
3. What is the resource utilization?
4. How high is the budget depletion?
5. What dependencies are there between projects?
In addition, you will have an overview of the states and re-
sponsibilities. And you will get an insight into the “health”
of your portfolio and its projects.
The Benefit for Your Decision-Makers: A complete
overview of all planned and running projects ensures
decision-makers are always up to date on the portfo-
lio. They recognize budget and resource bottlenecks in
good time. By changing the priorities and the portfolio,
they can react according to corporate strategy.
3. STANDARDIZED PROJECT INITIATION
You want to ensure all project ideas and orders are prop-
erly considered in the portfolio selection. Nothing should
be forgotten. Thus, you are best off with a central and
standardized method of registering ideas and projects.
The best way to guarantee completeness is by:
1. A methodical approach with processes and workflows
2. Permissions and criteria for the steps of approval
3. Ensuring the planning quality of new projects
The Benefit for Your Decision-Makers: They get a
sound preparation for selecting the projects.
4. OPTIMAL INVESTMENT DECISIONS
Portfolio decisions are controlled by priorities. Project pri-
oritization can occur in various ways, for example by:
1. A direct statement of the importance and urgency or
the strategic contribution per project and calculation
of the priority
2. Defining prioritized strategic criteria and determining
the strategic contribution by weighting those criteria
and assigning them to the projects accordingly
3. Personal selection of the projects by decision-makers
SOLUTION PARTNER
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To be able to prioritize investment decisions objective-
ly, you should make sure the project portfolio really is
aligned to corporate strategy. By setting clear priorities,
you should show all stakeholders what is important as
well as urgent.
The Benefit for Your Decision-Makers: They decide on
the right projects. And they have an optimal and well-
founded budget use.
5. STRATEGIC CAPACITY PLANNING
An integrated PPM enables you to identify the actual avail-
ability of resources for projects. You can see the resource
requirements for running and new projects. Scenarios can
help you to optimize the temporal sequence of projects.
This allows planning for optimal resource utilization.
Moreover, PPM permits the long-term adaptation of ca-
pacities to future requirements. You can deliberately reg-
ulate the provision of capacities. Depending on the fore-
cast, different steps could be wise. You might need to
build additional capacities and skills, move them to other
projects, or reduce them.
The Benefit for Your Decision-Makers: Through
predictive provision, they ensure the due availability
of appropriate resources. This helps them to avoid
resource conflicts when implementing projects.
CLIENT
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