In a world that is becoming more and more complex, companies can use Project Portfolio Management to manage the complexity of their portfolios. In fact, as projects increase in number and size, the complexities and management challenges rise exponentially. Everyday, new market and strategic opportunities can arise. As a result companies need to make fast decisions such as deciding which projects to include and which to exclude from the project portfolio.
The factors that impact on complexity
Complexity has different meanings and it depends from the context. The definition of the portfolio processes depends on the size of the company and portfolio. Generally speaking, the larger the portfolio, the more difficult it becomes to manage the steps of the process efficiently.
Studies show that most organizations struggle to allocate resources on multiple projects. Usually, they are not able to find the best balance between the two conditions: underutilised and overworked. It seems that resources are always limited. To effectively utilize and manage these scarce resources it is extremely important to have good tools for resource forecasting and planning.
It is not as simple as it may seem at first glance. In theory, it is possible to move resources from one project to another to optimize the portfolio’s performance. In reality, people cannot be moved without reducing productivity.
Use PPM to manage complexity
Project Portfolio Management helps company deal with complexity by:
- Strategically planning initiatives
- Managing new ideas
- Scoring and balancing new ideas
- Planning according to resource availability
- Managing resources
By doing so, PPM keeps all organization departments aligned, especially when change happens and complexity increases. PPM represents a powerful tool that provides companies with the confidence that resources will efficiently support the business.
Keep in mind
To manage complexity it is important to use PPM practices. Unfortunately, it might not be enough in case of big companies and organizations. In fact, to efficiently manage complexity, this type of companies needs also structured PPM software. At the same time, companies and their executives should be aware of the fact that without effective management and communication practices software alone is useless.