PM ADVISORY:

Project Portfolio Management – The Art of Saying “No”
Part 4 of 6: Keeping Your Portfolio Balanced

By Jeff Oltmann

Synergy Professional Services, LLC
Portland, Oregon, USA

Construction Job

Effective project organizations say “no,” declining to do some worthy projects so they can focus their limited resources on a portfolio that contains only the best projects. The three previous articles in this series examined the first steps of constructing such a portfolio.

• Identify strategic drivers of the portfolio.

• Agree on valuation criteria that can differentiate between proposed projects.

• Research the costs and benefits of candidate projects.

• Construct a tentative portfolio of projects, then maximize its value.

At this point, the portfolio team has constructed a portfolio that is theoretically maximized in the face of resource constraints. However, it may be out of balance or not feasible for project teams to actually carry out. Solving those problems is the topic of this article.

As a quick review, the portfolio management process has five steps.

1. Clarify business objectives so the portfolio will align with the business’s strategy.

2. Capture ideas and requests for projects. This includes enough research to be able to make a rough forecast of probable costs and benefits.

3. Select the best projects out of the pool of candidates by using valuation criteria to differentiate the best from the merely “good enough.”

4. Validate that the resulting portfolio is feasible, then initiate or continue the selected projects.

5. Monitor the portfolio as the program and project management system executes the projects.

   
   
   

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About the Author Jeff Oltmann, PMP Author Jeff Oltmann is principal consultant at Synergy Professional Services, LLC in Portland, Oregon (www.spspro.com). He is also on the graduate faculty of the Division of Management at Oregon Health and Science University. His specialties include strategy deployment, operational excellence, and project portfolio management. Jeff is a seasoned leader with over 20 years of experience managing successful technology programs. He ran the Program Management Office (PMO) and a $60M project portfolio for IBM’s xSeries development facility in Oregon. Jeff’s hands-on program management experience includes program budgets over $100M and worldwide cross-functional teams of over 100 members. Jeff welcomes your questions and ideas. You can contact him at jeff@spspro.com or read previous articles at www.spspro.com/resources.htm.