The Project Portfolio

Management eBook:
A Practical Guide to PPM
by

2024
Table of contents
The importance of project portfolio management 3
Free project portfolio management templates 4
Project portfolio management (PPM): an overview 5
Project prioritization methods & intake process 9
Program management 15
Cost estimating & cost-benefit analysis 20
Resource management and capacity planning 26
Stakeholder management 30
Practical tips for managing a project portfolio 34
Organizational planning and processes 36
Roadmaps and strategic planning 39
Project portfolio management with ProjectManager 42
The importance of project portfolio
management

Unlike a singular project, which has a defined end goal or

deliverable, a portfolio represents a more strategic planning
commitment to continuously optimizing the allocation, prioritization
and scheduling of resources across projects.

Whether you’re just getting started in portfolio management or

you’re looking to refine and elevate your expertise, you can utilize
the information in this eBook to create and maintain your portfolio to
maximize its value.

This eBook will help you:

✓ Prioritize the most profitable projects to attain business goals

✓ Determine how to coordinate projects and programs with the

company’s strategic plan

✓ Accurately estimate resource requirements to execute projects

with success

✓ Learn how to build roadmaps to effectively plan and hit

deadlines

✓ Understand what PPM tools are integral to success

To immediately start implementing improvements, download our free

project portfolio management templates on the next page.

3
Free project portfolio management templates

At ProjectManager, we offer pre-built templates to get started quickly in various areas of

project portfolio management. Click on each free template below to download it.

Strategic plan Strategic roadmap

template template

Risk management Operating budget

plan template template

Stakeholder map Cost-benefit

template analysis template

Project prioritization Resource plan

matrix template template

4
Project portfolio
management:
an overview
Project portfolio management (PPM) is the analysis and optimization of the costs, resources,
technologies and processes for all the projects and programs within a portfolio. Portfolio
managers or a project management office (PMO) typically execute project portfolio
management.

The key focus of PPM is to ensure that all of the portfolio’s outcomes support the
organization’s strategic goals and business objectives. The portfolio manager or PMO does
this through business analysis, reviewing budgets and forecasting while minimizing risk and
managing stakeholder expectations.

What do portfolio managers do?

Portfolios can be a group of programs or projects or even groups of other portfolios, each
with programs and projects within. Many larger organizations have highly structured vertical
operations; these businesses typically have a portfolio manager, or a PMO, within the
organization.

Smaller organizations might not have a portfolio manager role. Senior managers might be
responsible for handling multiple projects housed under the same strategic initiative,
industry vertical or product line.

From a high-level perspective, portfolio managers:

Already know the
✓ Manage one or more portfolios (groups of projects or
PPM basics?
programs) Click here to skip to chapter
✓ Identify and implement strategic initiatives two to learn about project
✓ Align programs, projects and operations to strategic prioritization methods and
initiatives the intake process.
✓ Measure, rank and prioritize programs and projects

The project portfolio management process

There are five basic project portfolio management steps:

Define business objectives

First, understand the organization’s business objectives and strategic goals.

Check if the project portfolio supports the financial objectives and customer
value. This requires project portfolio managers to agree on strategic goals with
stakeholders before establishing evaluation criteria for project selection.

6
 Collect project ideas

Start collecting projects; these could be in-progress projects or project ideas

similar enough to be managed simultaneously. Gather project management
data and prepare the valuation criteria to choose the best.

Select the best projects for the portfolio

Use a cost-benefit analysis alongside the valuation criteria to determine the

best projects for the portfolio. This criteria measures the amount of value that
each project brings into the portfolio. Some aspects of the project selection
criteria include the payback period, net present value or risk level.

Validate project portfolio feasibility

Now that the projects are selected, conduct a feasibility study that factors in
financial risks, capacity planning and resource management constraints. This
guarantees the project intake process prioritizes the best projects while
factoring in what’s feasible considering the organization’s available resources.

Execute and manage the project portfolio

Now, coordinate the execution of projects and programs in the portfolio by

working with project and program managers.

Here are five major benefits of PPM.

✓ Aligns projects to business goals: A crucial aspect of any project is to

ensure the project fits within the scope of the company’s strategic plan.
✓ Communicates project insights to the executive level: Gather more
advanced data to provide more profound insights that executives crave.
✓ Ensures proper resource allocation: Reallocate resources within the project
portfolio. With a portfolio, there’s a broader view of where resources are
being over- or under-allocated.
✓ Identifies and corrects performance problems: Portfolio analysis can
identify problems and address them quickly.
✓ Identifies and assesses project risks and impacts: What are the risks
inherent in the portfolio of projects? Learn how to identify and resolve them.

Even though the benefits of PPM far outweigh the costs and risks, it’s still important to
understand challenges that may develop throughout the process.

7
Common challenges of managing multiple projects

1 Poor communication

Communication can make or break a project. When teams don’t understand what has
to be done, they’ll spend more time and money than necessary on tasks. Stakeholder
communication is also important. Without communication, they might interrupt the
proper management of the project.

2 Lack of trust

A lack of team trust can be detrimental, especially when delegating tasks. If

responsibilities aren’t shared, team members won’t trust one another. This results in
eroded morale and threatens to veer the project off track.

3 No clear roles or responsibilities

Chaos ensues when teams don’t know who’s working on what. Projects should run
like machines, with each team member doing their part like gears that move the
project forward.

4 Bad planning

Failing to put the work in before project execution means project portfolio managers
are doing so during project execution. This is a recipe for disaster. Each project
needs a thorough project plan and a plan to manage the other projects
simultaneously.

With so many projects happening simultaneously, it can be

difficult to prioritize them. Let’s explore the methods and
processes to help.

8
Project prioritization
methods and intake
process
The significance of prioritizing projects

Although project prioritization benefits companies of all sizes, it’s especially important for
larger organizations with multiple projects and programs in their portfolio. They must execute
multiple projects simultaneously but have limited resources, which makes it necessary to
prioritize potential project ideas.

Program managers, portfolio managers and project management offices (PMOs) are
responsible for prioritizing projects. They do so by establishing project prioritization criteria
that weigh the pros and cons of existing projects and potential projects and make a decision
based on their analysis.

Now that we’ve established key background information on project portfolio management
and the importance of prioritizing projects, let’s delve into various methods that PMOs can
utilize to better prioritize projects.

Methods to prioritize projects

There are many project prioritization methods to manage project portfolios. Each has pros
and cons depending on the portfolio management or PMO needs.

Scoring model

The scoring model is a project prioritization method that relies on subject matter
expertise. This method consists of evaluating different aspects of a project and
assigning a numeric value scale to each criterion.

For example, assign numeric values to a project’s risk level, potential benefits,
feasibility and other variables. The scoring model is defined by the program,
portfolio manager or PMO in collaboration with cross-functional teams.

Project prioritization matrix

A project prioritization matrix allows program and portfolio managers to

prioritize projects by comparing several project prioritization variables on a
single comparison matrix. This matrix is similar to an Eisenhower matrix, a 2×2
table comparing task urgency and importance. A project prioritization matrix
works like an Eisenhower matrix but generally involves more variables.

10
 Payback period

As its name suggests, the payback period project prioritization method focuses
solely on the payback period, which is the time it takes for an organization to
recover the investment made on a project. Based on this method, teams
prioritize projects depending on how quickly they can return the investment.

The process of prioritizing projects in four steps

1 Assess the existing projects

As a team leader, reflect on where the organization is before taking on new projects.
Unfortunately, that doesn’t always happen.

As companies evolve, they’ll always be strapped with limited resources; not enough
time, not enough money or not enough people. This is true in almost every
organization, big or small.

Use the current portfolio of projects as a marker that illustrates how resources are
allocated at that moment. This provides a snapshot of whether projects and
strategies coincide.

Here are a few tips to assess existing projects.:

✓ Do all projects fit under the strategic vision?

✓ Does the new project(s) fit into this strategic framework?
✓ Does the company have the necessary time, people or other resources to make
this successful?

If the answer to these questions is yes, push forward. If the majority of the answers
are no, consider what the team is doing and why.

2 Define the project prioritization criteria

It won’t be enough to identify projects, their fit in the organization’s strategy, and
ensure that they’re all working in the right direction. Teams must focus on setting
clear project prioritization criteria for future projects.

11
 Project prioritization needs vary from one organization to another and so do the
variables that make up the prioritization criteria or scoring model. For example, one
goal of project prioritization is to help with portfolio management by using existing
resources as efficiently as possible.

From that standpoint, prioritize similar projects that use the same resources to make
the most out of resource leveling and resource allocation efforts. This reduces costs
and improves the organization’s operational efficiency. Here are some examples of
things to include in the project prioritization criteria.

✓ Project feasibility
✓ Potential risks
✓ Cost-benefit analysis
✓ Relative need to the organization
✓ Business value
✓ Project length
✓ Resources needed
✓ Strategic alignment

3 Prioritize new and existing projects

Once teams establish the project prioritization criteria that best fit the organization,
prioritize both existing and potential projects. Choose which method works best and
establish a system.

4 Manage projects aggressively

The final key to coordinating business strategy and project management is to

manage projects aggressively. This allows portfolio managers to constantly focus
and refocus on key areas of impact, the long-range strategy of the organization and
resource coordination. In many organizations, the project management muscles
need to be built and the focus on a consistent project management culture is a
consistent point of emphasis for PMOs.

As we’ve mentioned, part of being an effective portfolio manager is constantly

having a pulse of the costs and resources used across the organization.

Once a project is selected, it goes through the project intake process. This
standardizes the steps in requisition, assessing, accepting, declining or deferring
incoming requests or new projects. PMOs use it to manage incoming requests for the
projects they oversee. Other involved parties include business decision-makers and
project portfolio managers.

12
Project intake criteria

Look out for the following when evaluating project requests:

✓ Strategic alignment: The considered request or project must support the organization’s
long-term goals.

✓ Project scope & duration: Review the goals, deliverables, tasks, costs and deadlines.

✓ Resource requirements and effort estimation: Resources are everything needed to

complete the project and the effort will help create an accurate estimate.

✓ Resource capacity and availability: Review available resources and determine the
maximum amount of work that can be accomplished.

✓ Expected project benefits: Forecast the return on investment or estimated revenue

expected.

✓ Project risk analysis: Identify both positive and negative risks that might occur for the
request or project being proposed.

✓ Cost-benefit analysis: Estimate the costs of the request or project against its provided
benefits.

Steps in the project intake process

1 Create an intake form that outlines project requests

This document collects information about the request or project being considered. It
outlines the project objective, stakeholders, budget, date, etc. This helps the PMO
determine if the request fits into the organization’s strategic plans.

2 Use the project intake criteria to evaluate project requests

The above project intake criteria are the metric by which the PMO can measure the
feasibility of the request. The project intake team then reviews this and assesses if
it’s worth pursuing.

13
 3 Approve project proposals and allocate resources

If the proposed project meets the criteria, the next step is approval. Then, resources
for that project will be allocated such as the project team, materials, equipment, etc.,
required to complete the project.

What to include in the project intake form

1 Project description

Define the type of project being proposed to help determine if the project is the right
fit and if there are enough resources.

2 Project scope overview

The scope helps set boundaries and helps achieve project goals without delays or
overspending.

3 Resource requirements

Include both human and nonhuman resources required to complete the project.

4 Estimated project duration

To determine if the project can fit into the organization’s larger operation, it’s
important to know the project duration.

5 Expected project benefits

Determine how the project can increase sales, revenue, market share or another
value.

As more coordinated projects come through the pipeline, they

need to be executed simultaneously; this is where program
management emerges.

14
Program
management
Successful program management requires considering all active
projects and how they make up the portfolio. Programs are related
projects managed in a coordinated manner so they can share project
resources, costs and activities.

The goal of program management is to drive benefits to the program

as a whole, which often requires considering project-to-project
dependencies.

The role of the program manager

Program managers, Program Management Professionals (PgMPs),

oversee the program’s life cycle and work with different teams,
project managers, portfolio managers and stakeholders. This role
works across projects to identify and build on interdependencies
and direct the project managers who work on individual projects and
facilitate communication between cross-functional teams.

The main responsibilities of a program manager include risk

management, quality control, change management, managing
stakeholder communication and reporting. They also collaborate
with program directors and portfolio managers so that their program
corresponds with the organization’s program portfolio management
plan.

Creating program management plans

A program management plan is a document that describes the most

important aspects of a program and establishes the guidelines,
procedures and documentation used to manage it. While there isn’t
a one-size-fits-all outline for this plan, here are some basic elements
to consider:

✓ Program goals and objectives

✓ Program timeline
✓ Program budget
✓ Resource management plan
✓ Change management plan
✓ Program management plan
✓ Risk management plan

16
3
Tips for creating a program management plan

Program management plans tend to be similar to creating a project management plan but
stay aware of the differences between the two. Remember, a project plan is directed toward
its deliverable, but programs have a more strategic goal for PMOs.

List goals & objectives

That said, the first thing anyone making any plan needs to do is define what
they’re trying to achieve. List the goals and objectives to make sure the plan
stays within those parameters. Goals aren’t achievable if they aren’t clear.

Therefore, communication, as in all projects, is paramount. Without a

designated channel, determined frequency and targets, to whom the messages
are aimed, there will be problems.

Plan communication

Communication includes keeping stakeholders updated. In the case of

programs, the stakeholders are those in the organization, usually at an
executive level, who want to see the return on their investment reflected in
program reporting. The program plan needs to outline those communications,
how often and with what materials, including defining their expectations.

Make a timeline

Next comes dealing with the timeline and scope of all the projects in the
program. This means the overall budget and how it reigns in the program’s
scope. Find a balance between those two aspects of the program. While there
isn’t a schedule that ends with a quality deliverable, there’s a series of smaller
deadlines inherent in each project that must be managed.

Include stakeholders

Be sure to plan not only with stakeholders but the team. Transparency is
important. The team is on the front lines of the project, and they will provide
valuable data through their engagement and observation. In turn, they should
know the program plan, so they can make educated choices when forced to act.

17
 Monitor KPIs

Key performance indicators (KPIs) should be both quantitative and qualitative.

Be sure they’re clearly written and shared with stakeholders and the team so
everyone is on the same page. They should meet the organization’s goals and
be both achievable and measurable, when applicable.

Traits of good program management

Consensus building

Strong program management can create uniformity across teams and areas of
business so everyone is working towards the same goal.

Risk assessment

Program managers need to identify, track and resolve risks as they come up,
knowing when to escalate them to avoid issues in the future.

Attention to detail

Program management is always looking at project progress and connects it to

budgets, deadlines and strategic objectives. Documentation plays a key role in
this, whether the program manager is doing it themselves or delegating it to
others.

Benefits of program management

Connect projects to larger strategic initiatives

One important part of program management is coordinating multiple projects

within a program. Program managers link project objectives to the program’s
objectives and ensure they support the company’s long-term goals.

18
 Identifies project interdependencies

As program managers oversee many related projects, they often have a unique
vantage point of how projects are connected. When managing different
projects, dependencies between them may exist that might not be apparent to
project managers. Program management helps coordinate work across related
projects as they progress.

Focus on risks and opportunities

Both risks and opportunities are magnified in a program due to the sheer volume
of projects. However, program managers have a bird’s-eye view of the projects
to help them identify risks and take action on opportunities as they arise.

Streamline resource allocation

Another benefit of program management is the ability to see and understand

how project resources are used and interconnected. This makes it easier to see
which resources are needed such as when an increase in budget is required or
there needs to be new software purchased. If there’s one project team hitting
goals ahead of schedule, program managers can redistribute resources across
the program to help it hit its goals.

Cost and resource management is an essential part of successful

program management. Let’s explore this topic in detail below.

19
Cost estimating
& cost-benefit
analysis
Cost estimation techniques

A cost estimation process allows project and portfolio managers to achieve project goals and
objectives set forth by executives and stakeholders. The budget collects indirect costs and
direct costs as it estimates the overall cost of delivering the project on time and meeting
quality expectations.

Many factors impact project cost estimation, making it difficult to come up with precise
estimates. Luckily, cost estimating techniques can help develop a more accurate cost
estimation.

1 Analogous estimating

Seek the help of experts who have experience in similar projects or use historical
data. If there’s access to relevant historical data, try analogous estimating, which can
show precedents that help define future costs early in the project.

2 Parametric estimating

There’s statistical modeling, or parametric estimating, which also uses historical data
of key cost drivers and then calculates what those costs would be if the duration or
another of the project is changed.

3 Bottom-up estimating

A more granular approach is bottom-up estimating, which uses estimates of

individual tasks and adds them to determine the overall project cost. This method is
even more detailed than parametric estimating and is used in complex projects with
many variables such as software development or construction projects.

4 Three-point estimate

This comes up with three scenarios: most likely, optimistic and pessimistic ranges.
These are then put into an equation to develop an estimation.

21
 5 Reserve analysis

Reserve analysis determines how much contingency reserve must be allocated. This
approach tries to wrangle uncertainty.

6 Cost of quality

Cost of quality uses money spent during the project to avoid failures and money
applied after the project to address failures. This can help fine-tune overall project
cost estimation. Comparing bids from vendors can also help determine costs.

Tips for effective cost management for portfolio managers

Make sure to keep the below tips in mind.

1 Plan for inflation: Pricing isn’t set in stone, and any good budget will take this into
account by allowing for a range of costs.

2 Account for natural disasters or potential events: Expect the unexpected might
sound silly, but have room in the budget for a weather event, personal issue or
another unknown that’ll delay the project.

3 Other unexpected costs: Not all unexpected costs are random. There can be legal
issues, penalties associated with the project or unexpected labor costs that can
inform the budget.

4 Track in real-time: Having software to monitor the budget during project execution
is key for managing costs. However, outdated data makes it difficult to resolve
issues. Be sure to invest in software with real-time data tracking.

5 Respond promptly: Regardless of whether discrepancies in project cost are

discovered, it’s important to act immediately. Waiting longer means more money is
wasted.

6 Size accordingly: Some people think smaller projects don’t need project cost
management. But small or large, it’s important to manage costs.

22
Cost-benefit analyses: is the next project worth it?

While it’s tempting to jump at every project opportunity, it’s important to focus on data to help
decide what comes next in the portfolio. One easy way to do this is through a cost-benefit
analysis (CBA).

This process estimates the costs and benefits of decisions to find the most cost-effective
alternative. A CBA is a versatile method often used for business, project and public policy
decisions. An effective CBA evaluates the following costs and benefits.

Costs Benefits
✓ Direct costs ✓ Direct
✓ Indirect costs ✓ Indirect
✓ Intangible costs ✓ Total benefits
✓ Opportunity costs ✓ Net benefits
✓ Costs of potential risks

A cost-benefit analysis evaluates the cost versus the benefits in the project proposal and
business case. There’s a list of every project expense and the expected benefits after
successfully executing the project. From that, it’s possible to calculate the cost-benefit ratio
(CBR), return on investment (ROI), internal rate of return (IRR), net present value (NPV) and
the payback period (PBP).

Whether the benefits outweigh the costs will determine if action is warranted. In most cases,
if the cost is 50 percent of the benefits and the payback period isn’t more than a year, the
action is worth taking.

There are two main purposes for using CBA:

1 To determine if the project business case is sound, justifiable and feasible by

determining if its benefits outweigh costs.

To offer a baseline for comparing projects by determining which project’s benefits

2
outweigh its costs.

23
How to do a cost-benefit analysis

1 What are the goals and objectives of the project?

Create a business case for the project and state its goals and objectives.

2 Review historical data

Before determining if the project is right, compare it to similar past projects and
determine the best path forward. Check success metrics such as their return on
investment, internal rate of return, payback period and benefit-cost ratio.

3 Determine stakeholders

List all project stakeholders, or those affected by the costs and benefits. Describe
which of them are decision makers.

4 What are the project costs and benefits?

Estimate the future value of project costs and benefits and consider the
non-financial benefits a project proposal could bring.

5 Define the project timeframe

Look over project costs and benefits, assign them a monetary value and map them
over a relevant time period. Be sure to understand the cost-benefit ratio formula
factors in the number of periods in which the project is expected to generate
benefits.

6 Determine the rate of return

The rate of return calculates the present values of project costs and benefits, which
are needed to find the cost-benefit ratio.

24
Cost-benefit ratio and formula

The cost-benefit ratio, or benefit-cost ratio, is the mathematical relation between the project
costs and financial benefits. It compares the present value of the estimated costs and
benefits of a project or investment.

This is a simplified version of the cost-benefit ratio formula.

Cost-Benefit Ratio = Sum of Present Value Benefits / Sum of Present Value Costs

✓ If the result is less than 1: The ratio is negative and the project isn’t a good investment.

✓ If the result is greater than 1: The cost-benefit ratio is positive and it’s a good investment.
The larger the number, the most benefits it’ll generate.

Once there's a chosen cost estimation technique and there's a

better idea of whether the project is worth it, next comes the
specifics of resource management and capacity planning.

25
Resource
management and
capacity planning
Portfolio managers must understand how to measure the utilization rate of resources over
time such as a quarter or a fiscal year.

Resource management techniques

Project and portfolio managers implement the following resource management techniques to
forecast, plan, allocate, level and optimize resources during the execution of a project or
portfolio.

1 Resource forecasting

Portfolio managers must estimate what resources are needed and how those
requirements fit the organization’s current plans. This requires defining the project
scope to identify project tasks and their required resources.

2 Resource allocation

Evaluate available resources, capacity, resource schedule and the tasks that must be
completed to find the team members with the most relevant skills. Ensure they have
the resources they need when they need them.

3 Resource leveling

Resource leveling is re-assigning work to a project team to solve overallocation or

scheduling issues. By understanding what team members can offer, it’s easier to
assign tasks based on their abilities to maximize efficiency.

4 Resource utilization

Careful resource planning is equally as important as resource tracking. Portfolio

managers need to keep track of resources to spot inefficiencies. Then they can
simply reallocate or make changes to the resource management plan.

5 Resource smoothing

This means delaying non-critical tasks to complete a project on time with the
available resources. This is done by using the slack or float on each task to delay
them withouₜ affecting the critical path. By delaying non-critical tasks, portfolio
managers can move their resources to complete critical path tasks and circle back to
the least important activities.

27
Capacity planning

Capacity planning is a process that balances the available resources to meet customer
demand or the project capacity requirements. It ensures a business has what it needs when
it needs it to fulfill demand. It allows for flexibility to help make a wide range of products and,
done properly, it ensures that no extra money is spent on the effort.

Budgeting and scaling are both guided by capacity planning, which helps identify optimal
operational levels. For example, determine what services are offered and the required
timeframe and staffing to cover the operational costs.

Beyond those reasons, capacity planning helps managers make more informed decisions. It
also helps employees by avoiding burnout or boredom on the job. As mentioned, it’s crucial
to help a company grow and assists in making better staffing decisions.

Effective capacity planning can improve resource, time, team and work management.

Tips to schedule multiple people on multiple projects

Team members are active on several projects at once. The ability to actively manage their
tasks on all projects is no small feat. Here are some tips for scheduling resources across
projects.

Minimize overlaps

Schedule team members so they spend as much time as possible focused on

one project. That might mean a few days on one project here, then a bit of time
on another project, then a week back on the first project. This avoids the need
for multitasking.

Schedule for the busy times

Use resource demands to determine peak activity times. It’s typical for demands
to be high during the delivery/build stage and during testing. Establish timelines
across projects and try to stagger busy times and offset schedules. Be mindful
of when projects are going live at the same time to better manage resources.

28
 Know where to focus resources

Look at schedules to ensure everyone is working on what’s important.

Low-priority tasks can wait, especially when there are high-priority tasks
essential for moving other projects forward.

Talk to other project managers

Team members may be working on projects managed by several project

managers. If the project manager is the same, it makes resource leveling that
much easier, but if not, project managers should share their plans. Set up
conversations and resource review meetings to discuss obstacles and
progress.

Use workload scheduling tools

Online workload charts make it easy to see where resources are overloaded.
Who has too much work and who can take on more tasks? Then, adjust
workloads as needed to find the right balance.

Manage absences

Both planned and unexpected absences should be accounted for. If a resource

is scheduled to work on several projects during a time when he or she is away,
it puts multiple projects at risk. Plan and build good relationships with both line
managers and the team so they communicate about schedules effectively.

The availability and management of resources can impact how

programs are evolving. If there are delays or important updates,
be sure to inform stakeholders

29
Stakeholder
management
In portfolio management, stakeholders are the individuals, groups or organizations with a
vested interest in the project or portfolio as they are impacted by the outcome of the
business venture. There’s often a variety of stakeholders and some may even have
competing interests depending on whether they are internal or external.

Examples of portfolio management stakeholders

We’ve outlined some examples of teams or organizations that should be involved in project
portfolio management.

✓ Investors: These can be shareholders or debt holders who have invested capital in the
business and are looking for a return.

✓ The board of management: Helps set the strategy on how to invest the company’s
investments and communicates this with portfolio managers.

✓ Employees: These stakeholders rely on their employment and job security. They have a
direct stake in the organization as it supports them and provides benefits.

✓ Customers: These stakeholders want the product or service that the project delivers and
they expect it to be of quality and contain value.

✓ Corporate finance: The corporate finance team can work with portfolio managers to
ensure that investments are well spent and that the right financial techniques are
implemented.

✓ Human resources: As people carry out the company’s essential functions, the HR
department is often in close contact with portfolio managers to ensure alignment in
achieving success.

✓ Suppliers and vendors: These stakeholders have their revenue tied up with the project
as they sell goods and services to the business managing the project. Project success
means more business for them.

✓ Communities: These stakeholders don’t want the project to negatively impact their
health, safety or economic development. The organizations that are housed in their
communities or working on projects in their communities can impact job creation,
spending and more.

31
✓ Government: These stakeholders get taxes and gross domestic product from a project.
They are major stakeholders as they collect taxes from both the company on a corporate
level and individually from those it employs.

How to manage project stakeholders

Managing stakeholders is easy with the right stakeholder management steps. Here are the
steps that any project or portfolio manager should follow when managing stakeholder
relations.

Stakeholder identification
01

Identifying the stakeholders is key as the portfolio’s success depends on it. If

the stakeholder isn’t happy, the project, and therefore the portfolio cannot be
successful.

A good place to start determining stakeholders is by reviewing the project

charter, which documents the reason for the project and appoints the project
manager. Among the information about objectives, budget, schedule,
assumptions, constraints, project sponsors and top management, it’s possible
to discern the stakeholders.

Make sure to review the contracts as stakeholders might be mentioned in these

documents. Are there environmental factors or other organizations with key ties
to the project? Look those over as they might supply the names of stakeholders.
For example, if there are environmental factors dictated by the government,
then the government is a stakeholder. Review their regulations and standards to
stay on good terms with them.
02

Stakeholder analysis

With stakeholders identified, it’s time for the stakeholder analysis phase. Gather
information and requirements from them and begin estimating their level of
involvement and influence. This helps prepare stakeholder communication
strategies and prioritize them.

32
 Stakeholder prioritization

03 A key question for anyone managing a portfolio of projects is how to manage

and prioritize stakeholders. To complicate matters, there are likely many
stakeholders to consider.

Throughout a project and portfolio, one stakeholder might be more valuable in

terms of objections and some might demand more attention than others. When
building project schedules, define who those people are and at what point in the
project phase they might need more attention.
04
Stakeholder engagement

Now we’ve come to the second part of our question. When we talk of
stakeholder management, what we mean is creating a positive relationship with
stakeholders by meeting their expectations and whatever objectives they
agreed to in the project. This relationship isn’t just granted, however. It must be
earned through proactive communication and listening to their needs.

Consider interviewing the most important project stakeholders. Don’t be afraid

to speak to experts to get background information on particular fields or groups
so one-on-one conversations with stakeholders are informed and productive.

Once there’s been a meeting between stakeholders and the teams responsible
for executing the various projects, there will be both a macro and micro view of
the project. This informs the program plan as it’s finalized.

We’ve covered a lot of information so far. Below, we break down

some tangible tips to improve project portfolio management.

33
Practical tips for
managing a project
portfolio
Here are some tangible tips for managing more than one project.

✓ Establish a project management office (PMO): They will communicate with

stakeholders and clients and define and maintain the company’s project management
standards.

✓ Avoid resource overlapping: Managing many projects requires many resources. Make
sure to avoid resource overlaps as they can impact scheduling and budgets and
jeopardize the project’s success.

✓ Find the critical path: The critical path is the shortest amount of time needed to complete
the project as outlined by the essential tasks. This helps managers prioritize and balance
resources across projects.

✓ Assemble the right team for each project: Each project is different and the team should
reflect its unique needs. Assemble a team that can work together and has the right skills
and experience to complete the project.

✓ Plan and communicate: Both planning and communication are key components of
successful portfolio management. Make weekly plans and communicate with both the
internal team and stakeholders.

✓ Review and adjust: Things happen and plans change. Make sure to regularly monitor and
review progress and performance to make changes as needed.

✓ Delegate work: One person can’t possibly manage multiple projects without a supportive
team. Accept help and delegate work accordingly.

✓ Stay organized: Post-it notes or static Excel sheets won’t cut it. Teams need updated
dates and numbers in real time.

Project portfolio management is part of a larger organization’s

goals, and there may be projects that don’t fall into a specific
portfolio. These projects still need to be accounted for when
considering operational costs and resources which fall into
organizational planning.

35
Organizational
planning and
processes
Organizational planning is how business owners organize the day-to-day operations. This
ranges from simple things, like the company’s reason for existence, to more complex
considerations like setting goals to reach an objective. The organizational plan is a
framework for creating tasks that allow companies to achieve their goals.

Types of organizational planning processes

There are various types of organizational planning goals; from workforce development and
financial planning to products, services and expansion planning.

✓ Strategic planning: The big picture view for the company. Define the company goals that
support the company’s overall mission, vision and values. This step involves upper
management.

✓ Tactical planning: Next, determine how to implement the developed plan. These are
typically short-term goals that are a year or less in duration. Middle management is more
involved in this process.

✓ Operational planning: This involves day-to-day operations needed to execute the

tactical plan. Set up work schedules, policies, rules and regulations for employees.

✓ Contingency planning: Always have a backup plan in case of unforeseen events or

issues. Consider the possible risks and responses such as software malfunctions or a
C-level executive departing from the company.

How to create an organizational plan

The four phases of the organizational planning process create a framework, but there are
different steps when making a plan:

1 Start with company goals and objectives: Where does the company want to be in
the short and long term? Then, assemble a team to lead the execution, tracking and
progress of the plan.

2 Create a chart to illustrate the organizational structure: Share it with the company
and keep them updated on progress as milestones are hit.

3 Create a task list with roles for everyone on the team: Assign them tasks and make
sure the team understands what’s expected of them.

37
4 Review where the company is currently: What processes are in place at this
moment? Reviewing this allows the team to see what they need to do to reach the
company growth targets.

5 Take information collected and put it in a document: Use this to track progress
while executing the organizational plan.

Portfolio managers always need to be looking to the future.

Another facet a PPM must keep in mind when meeting high-level
goals is a strategic roadmap.

38
Roadmaps and
strategic planning
A strategic roadmap is a visual tool similar to a Gantt chart. It communicates the company’s
strategic plan. Organizations will create a strategic plan to cover where they want to be over
the next three to five years. It shows high-level objectives, initiatives and a timeline over
which to obtain those goals that are set by the management team, who direct the effort for
the rest of the organization.

Benefits include:

✓ Ensures projects support the organization’s strategic plan

✓ Defines a timeline for achieving strategic goals
✓ Breaks down strategic goals into actionable steps

The strategic plan also highlights dependencies and potential obstacles that can delay these
goals. This strategy roadmap will evolve with the organization as business conditions
change. It should be easy to edit so these changes can be communicated to the team. This
provides transparency and consistency across departments and from leadership to
individual contributors.

What to include in a strategic roadmap

✓ Strategic objectives: The whole point of the roadmap is to achieve high-level goals. This
is a guide that should be clearly defined.

✓ Initiatives: These are the projects that the organization will initiate to achieve the
strategic goals outlined above.

✓ Action steps: List the tasks needed for each identified initiative. These explain how to
execute the projects and achieve their individual goals.

✓ Timeline: This is the schedule for the tasks and projects, their start dates, end dates and
duration. It helps to monitor progress and manage expectations.

✓ Deliverables: Deliverables are quantifiable goods or services that are provided

throughout the project and after the project.

✓ Milestones: Milestones measure progress by marking a specific point within a project

where a major deliverable is completed, such as moving from the planning to the
execution phase, creating a project plan, etc.

✓ Task dependencies: A task that can’t start or stop until another task has started or
stopped. It’s important to know these as they can cause bottlenecks in the schedule.

40
How to create a strategic roadmap in five steps

1 Create a strategic plan for the next three to five years

First, the leaders of the organization have to meet and create a strategic plan that
defines their vision for the future. This involves identifying the organization’s goals
and objectives and the sequence in which they’ll be achieved. While this is usually a
three-to-five-year plan, it can go longer.

2 Identify tasks or action steps to achieve strategic goals

Now, determine how to achieve the goal. Come up with tasks and use a work
breakdown structure to identify project deliverables and the tasks needed to get
there.

3 Create a strategic roadmap on a Gantt chart

Take the action items and add them to a Gantt chart timeline. Add a start and end
date for each task and link all task dependencies to avoid causing delays.

4 Identify milestones

Reward the team when they hit a milestone as it’s good for morale. At this point in the
process, identify and place those project milestones on the strategic roadmap.

5 Estimate the resources to execute the strategy roadmap

Resources are everything from project team members to the raw materials,
equipment and anything else needed to complete the work. Then estimate the costs
for these resources to fund the strategy roadmap.

Project portfolio management is nearly impossible without the

right tools. Good PPM software can help you access data to
select profitable projects, prioritize work and stay in touch with
stakeholders along the way. Read more about why teams trust
ProjectManager for project, portfolio and program management.

41
Project portfolio
management with
ProjectManager
Project portfolio management software is a tool that’s designed to centralize the
management and maintenance of a project management portfolio. With the increasingly
large amount of data now associated with a single project, let alone a portfolio, the use of
portfolio management software has become a necessity for project managers.

ProjectManager makes it easy to effortlessly manage your project portfolios. You can
group and organize your projects, easily manage your resources and collect valuable
project data and generate reports.

Plan and track portfolios with the roadmap

Use our PPM roadmap to collect all projects in your portfolio and display them on a
Gantt chart. Here, you can add filters, see which projects are open, track task
progress and highlight key metrics for stakeholders. The roadmap visually represents how
your portfolio is progressing and can help you identify issues before they become
detrimental.

43
Group and organize your projects

Keep track of your portfolio and glean insights into all of your projects with a high-level
overview. You can track portfolio dashboards that show six key metrics including health,
tasks, progress, time, cost and workload. This makes it easy to get insights into how your
portfolio is performing in real-time and make data-driven decisions to keep it on track.

44
Customized project portfolio reporting

Easily generate reports on your portfolio’s status, tasks and timelines. You can customize
reports to highlight status, customer, priority and more. Plus, you can print the reports for
formal meetings or share them with stakeholders.

45
Balance workload across a portfolio

With ProjectManager, it’s simple to manage your resources using our project portfolio
roadmap, timesheets, dashboards, workload page and more. Our tools enable you to track
your entire portfolio. With real-time access to your team’s schedules, including time away for
country or global holidays, it’s seamless to understand schedules and make informed
decisions to drive profitability.

46
World-class security

Admins on your team can create permissions based on role to keep data secure. Take
advantage of SAML single sign-on, two-factor authentication, strong password policies and
other features to keep your data secure.

Plus, ProjectManager maintains a SOC 2 Type 2 certification, proving that data security is
core to everything that we do.

47
Ready to try ProjectManager
for yourself?

Start free trial

Want to talk to our expert

sales team?

Contact us