There are three P’s of project management: Projects, Programs, and Portfolios. Individual projects fit within larger programs, which themselves fit within portfolios. Though related, tasks associated with project, program, and portfolio management are by nature very different.
What Is a “Project” in Project Management?
So, what exactly does “project” mean in the world of project management? Generally, a project is a temporary endeavor, with a finite start and end, that is focused on creating a unique product, service, or result. Nothing in the definition describes size or content—there are projects and project managers everywhere.
What Does a Project Manager Do?
As project managers, the key parts of the job are to balance the scope of work—also known as “deliverables”—to meet the project objectives with the resources that are available within the schedule and allotted budget. They must do this all while working to ensure the project meets the quality guidelines required by its customers, which is not an easy task.
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Project management is about applying the right tools, techniques, and processes, in a value-added way, to complete the project successfully. As we know, the body of project management knowledge is huge, and there are a number of skills, tools, and techniques available to support project managers in the delivery of these initiatives. What’s important is to understand the project, its goals and objectives, and what its challenges are, and to pick, choose, and use those right parts of project management accordingly.
What Is a “Program” in Project Management?
In some cases, it’s important that a group of projects are managed in a coordinated way to ensure that value is achieved. In project management terms, this collection of projects becomes a program. Like a project, a program is a temporary organization, so when those collection of projects are complete, the program is complete.
The Project Management Institute (PMI) describes program management in its PMBOK Guide as:
The application of knowledge and skills to achieve program objectives and to obtain benefits and control not available by managing related program components individually.
What Does a Program Manager Do?
Program management is not simply managing multiple projects—it’s a bit more strategic than that. The program manager also doesn’t micromanage those projects; he or she is helping ensure that the right work is moving between the right projects at the right points in time.
The program manager focuses, throughout the program, on the business benefits, starting very early at its inception by looking at what benefits can be realized and then making that happen.
Each project still has a project manager completing the work described above. The role of the program manager is to ensure that the benefits intended are met by validating that the correct projects are included in the program. Any project not providing value to the benefits is then realigned or removed from the program.
The program manager is responsible for overseeing the dependencies between projects and creating program-level plans to accomplish this.
For example, a master schedule is created to manage the dependencies between projects; a program risk management plan is created to manage program-level risks; and a program communication plan establishes how information will flow in the program. The program manager is then not managing the projects, but rather providing the oversight needed to ensure that the pieces of each project are completed effectively and efficiently in order to meet the needs of the other projects.
The program manager is focused on benefits realization—rather, knowing the benefits that can be accomplished from this collection of projects and focusing on achieving them. The program manager is also working to manage organizational change and ensure that the benefits are not only transitioned to operations, but that processes are in place to sustain these benefits.
Since the role of program management is to ensure that projects are aligned to the business strategy, as the strategy changes, the program manager also needs to communicate with the project teams so that they are aware of the changes and what needs to be done about them.
Like projects, you’ll realize programs are all around us, once you start looking at things from this framework. A program I recently worked on was the roll-out of a new concentration within our Master of Science in Project Management: Program and Portfolio Management.
It consisted of six new courses, and the development of each course was a project—complete with a project manager and operational work that needed to be done to implement this new concentration. These needed to be organized in a coordinated way, particularly around content and schedule. Additionally, until all were implemented, the full value of the program—awarding the concentration to our students—could not be realized.
Project vs. Program Managers
While the project manager is managing multiple tasks within a project, the program manager is coordinating between all the projects and looking at interrelated projects that may have the same goal and objective and some dependencies between each other.
With the program, it’s all about strategic alignment and benefits realization, while the project manager is working to deliver the project efficiently and reliably. The program manager should be able to understand what the project managers are doing to enable effective communication between them and work to understand where things are and support actions to improve its delivery.
Projects and programs live within organizations and are the organization’s investments to ensure that its strategic goals are met. This demands that any project or program selected is strategically aligned to top-level goals and delivers value to the organization. What’s critical is making sure that the organization is working to meet its strategies via its projects and programs, which are the tactics used to realize these benefits.
What Is a “Portfolio” in Project Management?
Portfolios are the third part of our conversation. A project portfolio is a collection of projects and programs that are managed as a group to achieve strategic objectives. An organization may have one portfolio, which would then consist of all projects, programs, and operational work within the company. It may also establish several portfolios for project selection and ongoing investment decisions.
According to PMI and its PMBOK Guide, a portfolio includes, “Projects, programs, other portfolios, and operations managed as a group to achieve strategic objectives.”
Organizations need to decide which projects are the right ones to focus on. Often times, they are limited by how many projects can be done based on the capacity within an organization, begging the question, “Are we doing the right projects?”
What Does a Portfolio Manager Do?
Portfolio management is the centralized management of one or more portfolios to achieve an organization’s strategic objectives.
Within organizations, the reality is often that resources are limited, whether it’s dollars, people, space, or equipment. Based on the organization’s strategy, there are several projects and programs that could be done; it just needs to be decided which are the right ones and in what order they should be completed in.
It’s critical to look not only at programs and projects at the individual level, but also holistically to know how these align with the organization’s overarching goals.
At the same time, it’s important to consider a level of balance in the portfolio. The organization “needs to keep the lights on,” while also developing new opportunities. Some risk needs to be taken, but the portfolio should not be so risky that everything could be lost within a period of time.
Beyond prioritizing and selecting projects and programs, portfolio management is balancing the portfolio so that the right projects and programs are selected and implemented. Monitoring and controlling is key to the process, since portfolio composition is not a one-time decision. Evaluations should be conducted in some regular cadence. It may be decided that a project’s priority becomes lower and others move into its place. A project could be temporarily moved out of the portfolio or permanently moved out of what that portfolio entails.
This is done to ensure projects align with an organization’s strategies, goals, and objectives. It may also be the case that, as we get into performing a project or program, we find it no longer aligns, causing a reprioritization of all projects and programs in the portfolio.
How Project, Program, and Portfolio Management All Work Together
Project, program, and portfolio management aren’t the same. It’s key that they work together, however. To be effective, for example, a portfolio manager should understand what project management is. This allows the portfolio manager to ask the right questions of the program and project managers and interpret the information in the most effective way, so that the portfolio strategy is well thought out.
With portfolio management, the organization is making sure that projects align to business strategies so it’s clear why particular work being done. To remain objective, it’s key that standards are developed for how projects are moved into and out of the portfolio.
From the project and program management perspective, it’s key that the plans are correct and communicated clearly to enable effective decision-making within the portfolio.
From a high level, projects are part of programs and portfolios, and programs are part of portfolios. Each are different, but most effective when managed as one.