There is a second gap with which to contend. Our traditional approach is to separate the function of project selection from that of managing the project pipeline. The traditional assumption is that once a project is approved, it is separated from the parental umbilical cord. The criteria on which the selection was based are lost. The only criteria remaining for monitoring project performance are specific to the individual project goals rather than the portfolio as a whole.
And how shall we deal with project and portfolio assessment? Is a project a static item or a dynamic system? If a project is dynamic in nature (its scope, timing, and cost are subject to change), then what effect does this have on the project portfolio? The typical project has a range of possible outcomes and costs. There is the base case and potential upside and downside. If the project was selected on the basis of a set of assumptions (stated in the base case), does that project still belong in the portfolio when its attributes change? Periodically we need to review the project to test assumptions, update givens, and monitor progress; examine alternatives; and consider remodeling the portfolio.
Thus, we can see that there are potential weaknesses in the typical project management implementation:
• The organization's objectives and goals, as supported by the project portfolio, are not communicated to the people responsible for project performance.
• The project performance, as monitored by the project managers, is not communicated to the portfolio managers, strategic planners, and senior managers.
• The gap that exists between these two groups, in both communication and available information, prevents active management of the portfolio based on the current, changing status of the component projects.
What is needed is a basis for addressing project selection issues, deciding on project termination, facilitating reallocation of resources, changing of priorities, and evaluating alternatives. Without this capability, there is no project portfolio management.
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What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.