This document provides guidance on establishing a portfolio to manage projects and programs across an organization. It discusses defining the purpose and scope of portfolio management, identifying existing initiatives, categorizing them, and prioritizing initiatives based on their contribution to strategic objectives. The benefits of portfolio management include greater focus on strategic goals, more efficient use of resources, and reduced disruption from changes. Challenges include resistance from those running projects and the need to gather comprehensive information.

1. How to get started –
managing a project
and programme
portfolio
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2. Introduction
• This guide is aimed at those responsible for arranging and managing
investment in projects and programmes across the whole of an
organisation or for a specific department
• This guide sets out the initial steps to:
— Help you understand what portfolio management is and its benefits
— Help you define the purpose for creating a portfolio in your organisation
— Provide examples of the challenges and resistance you will experience
when trying to establish a portfolio approach
— Give you some ideas for:
— Identifying all existing initiatives
— Categorising the initiatives so that you can see their impact by function, by contribution
to strategic objectives or by resource usage
— Creating criteria for initiatives to form part of your portfolio
• To access the white paper ‘Building Capability for Effective Portfolio
Management’ go to http://www.maventraining.co.uk/whitepapers/
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3. Scope of the work
• Portfolios represent the totality of an organisations investment in
the changes required to achieve its strategic objectives
• Portfolio Management is a coordinated collection of strategic
processes and decisions that together enable a more effective
balance of organisational change and business as usual
• The portfolio already exists (although it might not be called a
portfolio) as there are projects and programmes taking place
throughout the organisation at any one time, but portfolio
management is formalising what is known about it and how it can be
managed better as a group of initiatives
• To undertake portfolio management you first need to understand the
scale of the work already underway in organisational change
(projects and programmes) and business as usual(daily pressure of
work and small scale change initiatives to make improvements to this
daily work)
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4. Benefits of portfolio management
• Greater emphasis on achievement of strategic objectives
— Clearer link between actual activity and ideas in the Business Plan
— Increase in the emphasis given to realising benefits and the subsequent
increase in their achievement
• More effective use of resources:
— Reduction in costs from stopping or not starting initiatives that do not
contribute sufficient benefits
— Increase in availability of resources to undertake projects and change
initiatives deemed high priority
— A reduction in project and change activity that is a duplication of effort
or is running at cross purposes
— Fewer resources are involved in preparing for change, with consequent
reduced pressure on all resources
— Fewer initiatives mean less disruption to day-to-day business activity
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5. Why do you need a portfolio?
• Need to understand the total spend that the organisation is making on
improvements and changes to the way it operates – many organisations are
surprised by the figures once they total the spend because prior to the creation of a
portfolio the spend was ‘hidden’ in departmental budgets and the total investment
in change was not calculated
• Need to see how much change is underway and how much capacity the organisation
has for more change – in some cases the need for a portfolio approach is driven by
pressure on resources who cannot assimilate the deliverables from multiple projects
into their working practices whilst at the same time managing growth in the volume
of their business as usual activities
• Need to understand where changes are taking place (resources split between
projects and programmes and business as usual) and where the organisation is
‘stable’ with limited project and programme management activity
• Need to understand the current resources assigned to projects and programmes in
order to undertake an expansion (hiring) or contraction (redundancy/restructuring)
• Need to understand what initiatives are underway prior to the launch of a new
strategic direction, where some of the existing initiatives will be stopped, some
given greater emphasis and the need for additional initiatives identified
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6. Challenges
• Those running the projects and programmes will see your
initial information gathering about existing work as:
— A threat to their autonomy to run them
— A threat to the continuation of these initiatives as
comparing them against each other in a portfolio will show
up the weaknesses (limited benefits, cost overruns, delays,
resource conflicts etc)
• Building a portfolio requires information gathering and
planning which can be seen as an additional bureaucratic step
that does not add any additional value to the organisation
• Project and programme managers believe that they are
already reporting the information that you want and that
portfolio management is an additional administrative burden
for them
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7. Identifying existing initiatives
• Who to ask - to create a comprehensive understanding of the existing
portfolio, don’t just take the information you are given in reports about
project activity in each department. You need to ask likely recipients of
project deliverables, who may identify initiatives that have not been
formally documented but are using resources – see next slide for
examples of who to ask
• What to ask – compile a set of characteristics about each possible project
and programme and make sure you ask all managers and read all reports
to gain the same information for each initiative. For example:
— Type of initiative – decide if you are going to capture details of all the projects within a
programme separately or just record high level information about each programme
— Project deliverables – systems, processes, staff hires, new locations, new equipment,
new or changed contracts with suppliers etc.
— Number and type of resources involved in each project
— The expected costs and types of cost e.g. consultancy, equipment, licences etc – and
define if the costs are from a departmental or central budget
— The benefits expected from each initiative, ideally quantified in financial terms
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8. Portfolio stakeholders
Internal
External stakeholders
stakeholders
Customer Support
Managers Customers Suppliers Reviewers
facing staff staff
Business
Function 1 Board High value Essential Regulators
line 1
Business
Function 2 Executives All others All others Auditors
line 2
Business Senior
Function 3 Media
line 3 Managers
Financial
analysts
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9. Building the portfolio – categorise
• Organises change initiatives into groups, types or
segments
• Categories can be based on:
— Type of deliverable or type of benefit
— Sponsoring department
— Users or those that will need to change their way of working
to benefit from the project
— Strategic objective that the project or programme
contributes to e.g.
— Growth in customers, staff, product or service range, locations
serviced by the organisation, number of offices
— Increase in productivity by person/team/department
— Decrease in cost of sales
— Decrease in staff turnover/increase in staff satisfaction
— Decrease in customer complaints/increase in customer satisfaction
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10. Building the portfolio – prioritise
• Once you understand what work is being undertaken,
organise the portfolio so that the following questions can
be answered:
— What are the most important initiatives?
— Which initiatives should the organisation invest in?
— What initiatives no longer meet the strategic objectives and can
be retired from the portfolio?
• Identify the importance of each strategic objective and give
each importance a weighting
• Assess each initiative for its contribution to the strategic
objectives and give it a score
• Multiply the score by the weighting and rank each initiative
with highest scores first – see next slide for an example of
this approach
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11. Prioritisation example - 1
• Weighting:
— Critical to the survival/success of the organisation has a
weighting of 3 i.e. 3 times more important than the least
important objective
— Important to the survival/success of the organisation has a
weighting of 2
— Useful for the achievement of the strategy has a weighting of 1
• For each initiative, identify its contribution to the strategic
objectives of the organisation:
— No contribution = 0
— Some contribution = 5
— Significant contribution = 10
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12. Prioritisation example - 2
Name of initiative Weighting Contribution Total value
Marketing programme 2 5 10
Upgrade of office software 1 0 0
Leasing of new office 2 5 10
Hiring new sales team 3 10 30
Sale of subsidiary company 2 5 10
Launch of new product 3 10 30
Name of initiative Weighting Contribution Total value
Hiring new sales team 3 10 30
Launch of new product 3 10 30
Marketing programme 2 5 10
Leasing of new office 2 5 10
Sale of subsidiary company 2 5 10
Upgrade of office software 1 0 0
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13. Call today on 020 7089 6161 to discuss
your requirements or visit the Maven
website for more information.
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