Tag Archives: Portfolio Management

MoP: Portfolio management organization


To implement en maintain portfolio management in your organization you need to have senior managers who are committed to portfolio management. The first step will be the institutionalization of a portfolio board. In line with the P3O and MoP theory we see the following portfolio bodies and teams (see Figure 1: Portfolio management organization):

  • Portfolio Direction Group or Investment Committee
  • Portfolio Progress Group or Change Delivery Committee
  • Portfolio Office (permanent)
  • Centre of Excellence


This article is divided into the following paragraph:

  • Overview
  • Purpose and responsibilities

To download: MoP (practice Organization, 150422) v0.1

This article will be used in a new book MoP practices in practice, for portfolio managers who want to embed the MoP theory in their organization. In the coming months several blog posts and articles will be published waiting for your feedback. To see all, select the tag MoP_practices_in_practice.


Guest blog from Dr. Harold Kerzner: Value Management and Benefits Realization

valueI received a request to accommodate a guest blog from Dr. Harold Kerzner. Dr. Harold Kerzner is Sr. Executive Director for Project Management, The International Institute for Learning.

He is known among other things as an author of many books in the field of project management. I asked him to write a blog about Benefits Management.

Years ago, in the early days of project management, most project managers came from the technical ranks of the company. Project managers were allowed to make technical decisions, within limits of course, and the majority of the business decisions were made by the project sponsor who normally resided at the upper levels of management. 

Project managers focused heavily on producing a deliverable as outlined in the statement of work or the contractual documents. While this became the norm, there was always the question as to whether or not the final deliverables actually created value. Today, the definition of a project is the creation of sustainable business value.  The definition of success on a project is when the sustainable benefits and business value are achieved within the competing constraints.

Simply stated, the project manager has been converted from a technical manager to a business manager where decisions must be made not only on the technology of the project, but the importance of creating sustainable business value. This means that the traditional metrics of time, cost and scope are no longer sufficient to track the project’s performance. Metrics related to benefits and value must also be included. The establishment of a portfolio project management office will certainly be helpful in this regard.

The attached white paper shows some of the changes that are now taking place. In simple terms, “Why work on a project where the outcome is not to achieve some form of business value and benefits?”


Book review: CIO’s guide to breakthrough project portfolio performance

breakthroughJust read the “CIO’s guide to breakthrough project portfolio performance. Applying the best of Critical Chain, Agile, and Lean” by Michael Hannan, Wolfram Müller and Hilbert Robinson.

The book is divided into 9 chapters and a handsome appendix to understand when to use agile and when not based on answering four simple questions.

When I talk about portfolio management, I always use four key questions, which need to be answered and drives portfolio management:

  • Are we doing the right things?
  • Are we doing things the right way?
  • Are we getting things done well?
  • Are we getting the business benefits?

In this book the authors uses three objectives:

  • Select the right projects;
  • Maximizing the portfolio’s throughput of project completions;
  • Optimizing the portfolio’s reliability of project completions.

These objectives are related to the first three questions and that already give one of my observations regarding this book. I miss the benefits part. Fantastic that we can improve the throughput of our projects but if we don’t get the business benefits from them you could ask yourself what have we done wrong? But that’s not the scope of this book.

Selecting the right projects is based on the following steps: Project identification, project validation, project prioritization, project selection and project politicking (political wheeling and dealing). In the selection process the authors show, using the Theory of Constraints, that we have to look at the throughput per constraint unit and the investment, as well as the relation with the strategy. ROI on itself is not enough.

Maximizing portfolio throughput is about the number of project completions that can be achieved over a given period of time. The authors offer five techniques for maximizing the throughput using elements of Critical Chain, Agile and Lean:

  • Project staggering (build the portfolio around the exposed constraint);
  • Focused, single-task execution. Multi-tasking will slow down execution enormously;
  • Elimination of task- or sprint-level commitments;
  • Lean process value stream analysis;
  • Ultimate Scrum (single piece flow in a pull system, the fewest possible open tasks, the shortest possible flow time and lead-time (thus no sprints).

For optimizing the portfolio reliability you get again five techniques. Three of them are already introduced: Single-task, elimination of lower-level commitments, and software enabled lean processes. Two new techniques are added: portfolio-buffering and buffer balancing. Schedule buffers and or budget buffers are being used in the more traditional incremental and waterfall approaches and scope buffers in the agile approach. Showing each project’s buffer status in a fever chart gives the opportunity to compare all projects (agile, waterfall, incremental).

Fight the zealotry is the next chapter. “one-size-fits-all” will not work. You get five examples to support you in your quest for a deliberate, practical, best-tool-for-the-job approach. E.g. “What if the scope is actually well defined and likely to remain stable? What if the customer has no desirement features?” A scope buffer will not work.

Overcoming obstacles describes eight obstacles and what you can do about them. E.g. convincing stakeholders that staggering their project for a late start will actually result in an earlier finish.

In the last chapter you get a recommended sequence of technique adoption and the characteristics of an ideal large-scale pilot.

Conclusion: The book offers a lot food for thought, brings agile, lean and critical chain project management together and is worthwhile reading. A pity the authors are not using one of the portfolio management frameworks (Axelos or PMI) and integrate their techniques within these frameworks. The lack of benefits management I already mentioned.

Lost in standards

Dia1In the last “projectie, edition 04-2014”, the bi-monthly magazine of ipma-nl, I published a Dutch article about the many methods and frameworks that are available in the field of portfolio, programme and project management. To download: Verdwaald in het standaardenbos IPMA Projectie magazine 04-2014 I created a sort of quick reference card with available standards and frameworks (It’s limited, there are many more). To download: standards-qrc-170129-v1-9

In the middle of the quick reference card you find a generic model with portfolio, programme and project management as horizontal boxes. Behind these boxes you will find vertical boxes with PMO, IT, benefits management, value management and risk management to support project, programme and portfolio management. And as the background I used two triangles representing the people and maturity of project, programme and portfolio management. From this model I made connections with several well-known organizations that develop and own standards. E.g. Axelos as the owner of PRINCE2, MSP, MoP, MoV, MoR, P3M3 and ITIL or PMI as the owner of PMBoK, The standard for Portfolio Management, The standard for Programme Management, OPM3, etc. You will also find AMPG, APM, IPMA and several suppliers of Agile/Scrum as well as some ISO models. dia1 In the Dutch article, I focus on the usage of these standards. It’s not that simple that you only have to select a project management method. Je must be aware that it will not be possible to implement all your ideas and ambitions. You have to select the right initiatives. This will ask for a portfolio management method. To realize your strategic objectives, you need more than only projects. You will run programmes too, asking for a programme management method. Besides temporary project and programme offices you probably need a permanent portfolio office as well as a centre of excellence to communicate, support and train staff to use these standards and best practices.

At a certain moment you want to know were you are from a maturity view, in comparison with others, and based on your own ambition you would like to know the gap you have to bridge. It will be beneficial for an organization if all these models or frameworks are connected to each other. As a rule of thumb, I would advice an organization to choose for either Axelos or PMI as the starting point and combine your choice with the competence baseline from IPMA. If you choose e.g. for PRINCE2, it makes sense to choose for MSP and MoP for your programme and portfolio management. For maturity scans you look at P3M3 because that’s in line with these standards. Your temporary and permanent PMO will be supported by P3O, etc. For supplementary techniques you could make use of the PMBoK from PMI.

Or, when you started with the PMI family, it makes sense to combine this with the project or programme board approaches from PRINCE2 and MSP and the usage of business cases as described in PRINCE2 9789401800068_CoverLR-541x850I am one of the authors of the book Global standards and publications, edition 2014/2015, Van Haren Publishing. You can download a free copy of this book. http://www.vanharen.net/file/PDF/9789401800068.pdf Please let me know if you are aware of new standards that are worthwhile to mention in this QRC.

for a comparison between PRINCE2 and PMBoK see the overview from KnowledgeTrain: Comparison PRINCE2/PMBoK


  • 17/01/29: Added PM2 Project Management Methodology from The European Commission
  • 17/01/29: Added Scrum @ Scale from Srcuminc.com
  • 16/01/23: Added Nexus (Scaled Professional Scrum) from Scrum.org
  • 15/10/04: IPMA ICB3 replaced with ICB4
  • 15/07/07: Added new Axelos framework PRINCE2 Agile
  • 15/05/27: Added Change mgt vertical + CMBoK (Change Management body of Knowledge) + CHAMPS2
  • 15/04/24: Added ISO 21500 project, 21503 programme, 21504 portfolio, 21505 Governance, 21506 Vocabulary
  • 15/02/24: Added CCPM (Goldratt), CMMi, Global Alliance for Project Performance Standards (GAPPS)
  • 14/10/21: Added Exin Agile Scrum from EXIN
  • 14/09/29: Added Agile Programme Management (Agile PgM) from APMG
  • 14/09/29: Added PRiSM™ (Projects integrating Sustainable Methods) from GPM
  • 14/09/29: Added Portfolio, Program & Project Sustainability Model (PSM3) from GPM

Elementary project portfolio management in pictures

I came across an illustrative book published by Ursus Wehrli called the Art of Clean Up. I thought it was great to see how the author rearranged certain situations to create new structures. Now you may ask: “what does that have to do with portfolio management?” Well, I would say a lot. Let us have a look at some of these pictures.

fruitschaalThe first picture shows a bowl with fruit. With this in mind, imagine you looking at all your projects in your organization. Are they all fresh or of recent date? Do you know how many pieces or projects you are looking at? Are there comparable pieces or projects?

To find out, you have to take piece by piece from the bowl and group similar pieces togetherfruitschaal gesorteerd or, in other words, categorize your projects. Which of your projects are there due to regulations, but also, which projects “smell” or, again in other words, which ones are overdue and not contributing to your strategy? Throw those pieces away; kill those projects, they will only draw on your scarce resources.

Assuming we know what projects we have, we can go one step further.

ZwembadDo you know how many people are working on your projects? Are they moving from one project to another?

If there is a problem in one project, some team members from other projects will be trying to help (fire fighting), but at the same time create new problems in their own. Eventually, none of your projects may turn out to be successful. Zwembad gesorteerdWho are the key players in your organization needed on several projects? Do we know how many people are needed for all our projects? Are they all available or do we have a few Supermen who could simply be assigned for at least 200% of their time? So, we need to understand how many resources and what skills are needed for all projects and how many of these skilled people we do have available.

soepbordBased on this information it becomes clear we have to cut in our project portfolio, as we most likely have too many projects going on or planned. So, we need to know which of these projects we can kill or postpone until a later date. What projects will bring the highest benefits to our soepbord gesorteerdorganization, what are the risks in these projects and what will those projects cost? Based on this information we can prioritize our projects. Taking our resource constraints (People & Budget) into account, we can draw a solid line to see which of the projects in portfolio are feasible (“above the line”) and by that which projects need to be killed or postponed (“below the line”).

sterrenhemelAfter we have gone through these steps, we should be looking at a portfolio of projects we are able to finish successfully. But will these all turn out to be a success? Do we know where we stand for each and all? sterrenhemel gesorteerdOr are we only looking at some big bright stars leaving the rest in a dark black hole? To monitor our projects we need progress information and early warnings of a project becoming a risk for all of our projects. A simple dashboard with this kind of information will be helpful in managing the complete project portfolio.

mapWhen looking at the pictures you may conclude that the basics of portfolio management are not that difficult. But in reality it will prove to be much more difficult implementing these basic steps. Use these ingredients, these basic steps, to build your own implementation plan and make sure you communicate this plan to all your map gesorteerdstakeholders. Let them know where you stand today, what route you will follow and where you most likely are to be ending.

Looking forward to your reactions. Feel free to share your own project portfolio management pictures.

The Standard for Portfolio Management, a Quick Reference Card


MoP Quick Reference Card

Many organizations are struggling with their project portfolio. The number of projects is increasing, there are continuously new surprises, overview of projects is lacking, several pet projects exists, the one who called the loudest, gets the priority, required resource insight is missing and we know what we spent, but don’t know what we get.

If you recognize this it’s probably time to get some structure in place. MoP, part of the Best Management Practice portfolio from the Cabinet Office, focuses on an organization’s collection of change initiatives and is based on tried and tested principles, practices and techniques that together help organization’s deliver their transformation agenda and realize strategic objectives.


The portfolio management model contains the five principles, the portfolio definition and portfolio delivery cycles and practices needed to effectively define and deliver the portfolio.

I created a MoP quick reference card to become familiar at a glance with this model. Have a look and please share your comments, remarks, improvements etc. To download: MoP (one pager, 140331)v0.3