The first step in the new PPM process is to evaluate the existing project inventory. Excising nonaligned, redundant, or nonbeneficial projects will release scarce resources for better opportunities.
Do you remember the chicken-or-egg question? Now that we're ready to implement a PPM capability, which should we do first? Do we use the portfolio planning process to prioritize or select projects for the portfolio? Or do we evaluate the currently active projects?
In most cases, the firm will already have a portfolio of projects (or multiple portfolios), although they might not call it by that name. Field experience has shown that this is a good place to start. New implementers of PPM have found that a structured review and evaluation of the existing portfolio can turn up numerous instances of deficiencies in that portfolio. In taking inventory of current project activity, they found projects that should never have been approved and projects that were failing to the point that they would not deliver anything close to their expected benefits.
We mentioned the HP/Compaq inventory of their combined project loads and their decision to eliminate over one hundred projects. This reduced the overall cost burden of the projects and opened up resources for more beneficial opportunities. (See Chapter 9.2.) AXA Financial reports a similar success:
When I took an as-is snapshot of what the lay of the land looked like, I discovered there were a number of projects behind schedule and over budget and, more important, that all projects were created equal. There was no hierarchy of improvement. There was no sense of how these projects related to our vision, mission, long-term, short-term—any kind of objective you wanted to define.
I bet we saved $5 million to $10 million in the first year alone, on projects that would have automatically gone through before. But, now the business units knew what could get killed, so they killed it first. It just became immediately apparent how much junk we weeded out of the system.1
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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.