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Why portfolio assessment beats project focus for development projects

While having the appropriate portfolio assessment tools helps, real results come from changing processes.

Simple tools, such as an Excel spreadsheet, can help an organization handle the impact of its IT and SOA portfolio when planning new projects and business capabilities. However, more sophisticated Project Portfolio Management (PPM) tools can help to improve the ability to gather, manage, share and understand information about the existing SOA portfolio. Gartner estimated the market for these tools in 2011 was about $1 billion.

man's open hands with drawn portfolio folders

Certainly, a good spreadsheet is often the entry point to improving overall PPM processes, said Tim Madewell, senior VP of professional services at PPM tool vendor Innotas. That said, the power from portfolio management tools lies in providing a central repository across teams and groups that helps in getting more timely and accurate updates.

Jim Duggan, research director at Gartner, said there are two main ways of breaking PPM tools down: cloud versus on-premises and portfolio versus project planning. In addition, vendors vary in terms of integration with other IT management and software development tools, support for mobile and Web interfaces, analytics, and social networking capabilities.

Start simple

It behooves an organization to assess the needs of the organization before purchasing a new PPM tool or risk buying capabilities that never get used in an effective manner, Duggan said. "It's like when learning a new musical instrument," he explained. "If you decide to learn … guitar, and you buy an expensive guitar, you might spend $900 more than you need to discover that you will not use it."

Focusing on portfolio optimization, rather than individual projects, is the way to go.

Likewise, if your organization is starting down the path toward a cloud-based system, application portfolio assessment can help to get the ball rolling with minimal investment. Down the road, when the process for managing the portfolio has evolved, it makes sense to look at other, more sophisticated PPM tools to help improve the IT planning process.

Some companies buy massive PPM systems that are inappropriate for their portfolio management practices. "Yet, what works best is buying at the right level to help in the early stages, and then migrating to other tools as the need arises," Duggan said. Organizations can also ease their way into PPM through integration with their existing software development or service desk tools.

Portfolio assessment with the right tools will not necessarily bring change, said Mark Jeffery, senior lecturer of executive education at the Kellogg School of Management. "One of the early things we found was that there is no link between having a tool and having a more mature portfolio management process," he said.

Having the tool helps, but the real link to results comes from changing the process. "At the end of the day you don't need these crazy sophisticated tools. You can get started with 3x5 scorecards and Excel spreadsheets," said Jeffery, who is also a managing partner of Agile Insights, an IT portfolio process management consultancy.

Portfolio versus project orientation

These experts stress that focusing on portfolio optimization, rather than individual projects, is the way to go. There are many benefits of portfolio analysis and management:

  • Tools with strong portfolio management capabilities are good for prioritizing IT programs and projects to be executed at the best time. They can help to balance IT resources (including human resources), time and money with new and existing demands. They can also help address changes and emergencies as they arise.
  • Tools with strong portfolio management capabilities are good for organizations that are mainly interested in improving data sharing, collaboration and communication between project managers and team members. These tools go beyond basic project management by helping organizations to capture non-project resource demands, track the use of resources on non-project work items and track the costs of these items.
  • Tools with a strong project management focus help project managers and team members improve the tactical details around projects. The reporting capabilities communicate progress and expenses to team members and management. These tools are best for organizations that want to improve the communication of team members involved in project execution.

On-premises versus cloud PPM

On-premises PPM systems can provide the organization with full control of the PPM infrastructure. It may be the only option when there are concerns about data privacy and security issues. In many cases, on-premises systems can also provide more robust functionality and flexibility. But deploying an on-premises solution also requires a long-term commitment and can take longer to set up than a cloud-based approach. It may also align well when the organization has a strong relationship with an on-premises PPM tool provider.

Cloud-based systems might be better suited for an organization looking for PPM functionality for immediate automation. It is also important to confirm that the network and application security of the cloud provider is sufficient to address the organization's demands for security and data privacy. A PPM service can be a good starting point when the organization is just diving into PPM for the first time.

The cloud is a great enabler in terms of cost, administration and overhead, Madewell said. Security and controls are evolving to make that data secure, and access and ease of access with cloud solutions is a huge benefit.

Cloud-based service providers can also provide economies of scale by controlling the interfaces and interactions, which can allow updates and enhancements more quickly than on-premises solutions. A pure Software as a Service offering can provide a lower cost of entry than some of the on-premises software tools. Furthermore, deployment and adoption can be measured in weeks rather than months.

Social networking and mobile device support

PPM tools are also starting to add social networking and collaboration capabilities. One approach is to improve basic issue tracking, calendar synchronization and integration with email. Another approach has been to partner with social networking tools such as Chatter, Jive and Yammer. These kinds of capabilities might help to improve the buy-in from users within the organization and encourage greater adoption.

Another emerging trend has been improved support for mobile devices. Many PPM providers are enhancing support for Web interfaces built using HTML5, which can run in most modern Web browsers. This can make it easier for employees to log time and can also allow for portfolio assessment and decision-making in the field.

Integration with existing tools

Madewell said they are seeing an increase in the integrations with other tools. The organization might have a core PPM tool, but the software team might be using Agile methodologies and the tools that support this process.

PPM vendors are integrating with those systems for gathering resource assignments on those activities, and bringing that into PPM. This allows a manager to get an enterprise view of the resources and activities at the portfolio level, and have full visibility even if they are not managed with traditional project management tools.

Some of the key integrations now supported by PPM vendors include integration with Atlassian Jira and Rally, VersionOne for Agile software development, and BMC's line of IT Service Management tools for gathering information from help desk systems. These types of integrations can be purpose-built by the vendors, or provided by third-party systems integrators. Some examples of purpose-built integrations include:

  • Atlassian Jira integration with Innotas and Planview, and Onepoint Projects-BMC Remedy integration with Planview and Planisware
  • Rally Software for Agile development integration with CA Technologies, Daptive, HP PPM, Innotas and Oracle
  • VersionOne integration into CA Technologies

PPM analysis tool capabilities

PPM tools are also improving their ability to use logged data to calculate metrics, planning and scenario analysis. "It's not just about the historical trends of how well a project was executed," David Blumhorst, vice president of solutions and service at Seattle-based portfolio tool vendor Daptiv, said. "You can also forecast upcoming demand. A manager can look at time, money and compute resources and lay that up against current model of resources, hours and roles to see how these fit into the current portfolio."

A sampling of PPM providers with on-premises tools include:

Augeo Software's Augeo6
BMC Software's BMC IT Business Management Suite
CA Technologies' CA Clarity PPM
Compuware's Changepoint
Genius Inside's  Genius Project
HP's HP Project and Portfolio Management (PPM) Center
Microsoft's Project Server
Onepoint Projects
Oracle's Primavera Enterprise Project Portfolio Management
Planview Enterprise (an open source PPM platform)
SAP Portfolio and Project Management
SemanticSpace Technologies' PPM Studio

A sampling of cloud-based PPM vendors include:

Automation Centre
EPM Live
Onepoint Projects
PowerSteering Software

About the author:
George Lawton is a journalist based near San Francisco. Over the last 15 years, he's written more than 2,000 articles on computers, communications, business and other topics. Find out more at

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