Project portfolio management evaluates and optimizes the resources, costs, processes, and technologies for all the projects in a portfolio. Its primary focus is ensuring all portfolio outcomes support your organization’s strategic business objectives and planning. The project portfolio manager achieves this via business analysis, budget review, and forecasting while managing stakeholder expectations and reducing risk. PPM helps with successful project delivery. Discussed below are five benefits of project portfolio management.
1. Optimizes resource allocation
Projects need many resources, such as equipment, labor, and materials, all of which fall under resource allocation. Resource allocation is a vital step in project management and involves approximating, procuring, allocating, and tracking resources till a project is completed. Proper resource allocation helps:
- Keep project costs down
- Maximize productivity
- Enhance team morale
- Facilitate customer satisfaction by attaining the best possible outcome
- Successful project delivery
Ensuring efficient resource allocation isn’t easy. However, using project portfolio management for resource allocation helps align resource allotment with your business goals and strategic vision. It also makes it easier to balance the allocation of resources among various products. With the help of a reliable PPM solution, you can optimize your business’s resource allocation among various product development stages.
2. Ensures project goals resonate with your business strategy
Every organization’s ultimate mission is to achieve its long-term and short-term objectives. Every project your company embarks on takes it closer to achieving its goals. A project manager must ascertain that every project aligns with company goals and business strategy. Failure to do so can lead to wasting workforce efforts and resources. Thanks to project portfolio management, organizations can analyze, choose, and prioritize the projects that resonate with their objectives.
3. It helps create realistic schedules
Project planning involves a lot of factors, including:
- Resource allocations
- Tasks
- Milestones
- Deadlines
- Cross-project dependencies
- Priorities
- Risk levels and more
Your company’s project planning should always delve into the future. Multi-project planning in a project portfolio management context utilizes available data to realistically and accurately plan for the near future. With the help of a trusted PPM solution, you can easily forecast the future using features like:
- Dashboards (project information graphical view) to make informed decisions
- Ability to visualize predictive resource management’s demand and capacity
- Situation planning to evaluate the effect of possible changes
This enables you, the project manager, to create a realistic timeline or generate a work schedule without extensive planning.
4. Improved portfolio risk management
Risk management is a process that involves identifying, assessing, measuring, and managing risk in a project portfolio. It focuses on events that can affect the attainment of strategic objectives. When your company proactively manages portfolio risk, it becomes better equipped to encounter more risk, raise portfolio worth, and have a higher successful project delivery rate.
Project portfolio management solutions provide risk scores you can leverage to determine the total risk your company is taking. They also give you visibility into all the risks in your portfolio so you can manage them better.
5. Enhanced project selection process
PPM enhances and streamlines the project selection procedure based on the availability of resources, risks, business goals, and more. It integrates qualitative and quantitative strategies to help project managers make informed decisions based on well-defined and relevant criteria.
Endnote
Effective PPM helps ensure successful project completion and delivery, which is crucial for business success. Familiarizing yourself with the benefits of project portfolio management can help determine if a PPM solution is worth considering.
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