portfolio managment at os v1.0

Building Pan Business Portfolio Management aka The Enterprise PMO (EPMO)

An Implementation Case Study in a Digital Business

John MacnabV0.37d

About This Presentation

A whistle-stop overview of portfolio management and EPMO implementation• Some background - definitions• Approach• What it looks like• Building an Enterprise PMO and PPM COE

Purpose• To share the approach taken within this organisation• To provide a strategy/start point, correct or incorrect for those seeking to implement an

EPMO….

Slide 2

This approach may not work for your organisation. But analyse it, work out why it won’t work, then you will have your own strategy. Any strategy is better than no strategy, so get started. So write it down, get it out for review and get started.

A few definitions

At the beginning of the implementation, classic definitions that were used to initiate the work

Portfolio:“A grouping or bundle of projects, collected together primarily for management convenience. They may or may not have a common objective, they are often related only by the use of common resources”

Portfolio Management:“The management of a number of projects that do not share a common objective”

Slide 3

A few definitions

But for this organisation, as with a majority of organisations, those definitions do not maximise value, at best they describe a bundle of administrative functions which may or may not add value. The definitions for this instance were rewritten :

Portfolio:“A series of strategically aligned programmes and fixed life-span projects that deliver beneficial change as defined in corporate strategy and objectives.”

Portfolio Management:“The co-ordinated control of connected or unconnected programmes of work that change the organisation to achieve agreed objectives and subsequent benefits.”

Slide 4

If an organisation is undertaking any change or improvement work that that work must identified as producing identifiable and measureable benefit against the corporate strategy. Any work outside of this definition has no place within the organisation… pet projects, out of date projects, projects with dis-benefit or a negative risk profile must be stopped.

Benefits Agreed for the Implementation of this EPMO(Localy agreed benefits for this example only)

Reduce Boardroom-level “Surprises”• Provide robust governance, applied across all projects• Provide regular, robust and accurate reporting across all CAPEX investmentsImprove Deliverability for Stakeholders• Effective risk management and escalation to board level if appropriate• Maximise benefits realised from programmes and projects• Avoid many common failures on programmes and projects• Improvement and standardisation of PPM capability across the organisationImproved organisational performance• Ensure benefits align to agreed corporate strategy• Provide a rigorous business case development and authorisation cycle• Corproate level change management• Better strategic management of resource and development requirements• Assure continued organisational development

Slide 5

There are many other benefits of an EPMO structure but in this case these were the critical ones for this organisation

Approach

The Problem•Investigations uncovered 120 concurrent projects•30 providing significant investment – representing 32% of turnover•Investigations also revealed that there was no overall direction or control (financial, governance)•Some projects were delivering outcomes directly contradicting deliverables from other projects •A major cause of this chaos was attributed to the (then) strong silo mentality •Lack of strategic focus and ability to map onto business benefits

Slide 6

The Solution •Take control from the centre•Benchmark PPM and delivery against maturity models•Rationalise and cull Projects against benefits and health checking•Establish a compliant PPM Centre of Excellence•Prioritise and establish financial controls & monitoring for all projects as they emerge•Centralise allocation of resources and budgeting •Build PPM competency and formalised career paths•Develop and implement Portfolio level controls and structures

Approach - Delivery

Slide 7

Post launchPre launch

Design & Document Buy in Structuring Assessment &

Migration ReviewRe-assessBaselineAssessment Re-assess Review

• At very high level the delivery of the structures is broken down into eight key components• Assessment – where are we • Baseline – repeatable (PPMMM/P3OMM) measurement • Design and Document – build all the critical tools required• Buy in – Senior management support for the change and, in this case, loss of control of their PM staff• Structuring – putting the key components into place for the build• Assessment and Migration – assessing and moving work into the EPMO• Re-assess – against baseline• Review – at Corporate Board level

• Critical to the delivery is timeliness – momentum needs to be built rapidly and maintained to drive through the changes

T=0 T=3 T=8 T=12 Months

Formal Launch

What it Looks Like - Delivering Corporate Benefits Through portfolio management

CorporateInitiatives

Benefits

objective objective objective

Benefits Benefits Benefits Benefits Benefits

DeliveryProject

DeliveryProject

DeliveryProject

DeliveryProject

DeliveryProject

Project stopped as no identifiable benefit delivery

Programme and Project Portfolio

Slide 8

What it Looks Like - Connecting Projects to Corporate Governance

• Reporting structures• Getting the correct level of information to the decision maker

• Risk management structures• Getting risks assigned at the correct levels

• Business benefits management• Realisation of benefits across the whole organisation

• Financial management• Managing across the investments not in isolation

• Governance structures• Having the correct functions making the correct levels of decision

Slide 9

What it Looks Like - Portfolio Management; the link to Governance

• Portfolio management is a subset of corporate governance• Project Management activities generally lie outside the concerns of corporate governance• Portfolio management connects project management activities into those of the corporate

body

Slide 10

Organisation

corporate governance

project management

Key to the success of the portfolio is that stitching in of the PPM governance to the corporate governance tying the change delivery and impact to the day to day activity of the organisation

portfolio management

Example Portfolio Governance Structure

Slide 11

Corporate Portfolio Level Board

SRO

PM PBS

SRO

PM PBS

SRO

PM PBS

Supplier (IT) Chief Financial Officer (Director of Finance)

Supplier (PDU)

PjM BS PjM BS PjM BS PjM BS PjM BS

PjM BS PjM BS

Ass

uran

ce (B

usin

ess)

Coordination EPM

O

Work Package

Development Team

Work Package

Development Team

What it Looks Like - Coherent reporting structuresProgramme/ Project/ Portfolio Governance and Control

Slide 12

Projects

Portfolio & Business

Board

Programme Board

Programme Manager

Business Health Check

Business Sponsor

SRO

Shareholders /Minister

report

report

report

report

• Interdependencies• RAID• Cost• Schedule• Progress• Etc.

feedback

feedback

feedback

feedback

What it Looks Like - Portfolio ‘Touch-Points’ portfolio management considerations – tying it all together

Slide 13

Effective projectmanagement

Alignmentto strategy

Releasemanagement

Companyplanning &forecasting

Budget management

Resource allocation & commitment

Portfolio of projects

Business as

usualBusiness as usual

Business programme

Business education

Best practice

Project Register

Building an Enterprise PMO and PPM COE

Slide 14

We start with the CoE or equivalent.Typically in any organisation there is a basic CoE in place, whether this be simple PM guidelines (employed or not) or a partial portfolio structure. However, there is likely to be a lack of formalisation and engagement with the change investment at the right level within the organisation. Or, the organisation has changed substantially requiring the implementation or re-energising of an Enterprise PMO strucutre to manage the investments.

CoE

CoE

Formalisation and bounding of the role of the COE and agreeing these with the business


Proceeded to grow the functionality, structure and strength by adding functional heads & strengthening the boundaries

CoE


Programmes & projects

Identified, reviewed & rationalised the current set of projects & programmes. Those that support a strategic objective are included, those that do not must resubmit a business case to the change function

CoE


CoE



Integrate/migrate the projects and programmes into the CoE structure over a short period of time engaging and providing support for the adoption of identified best practice in anticipation of formalisation of all functions.

CoE


CoE


Define portfolio management processes around the CoE and implement

CoE


CoE


This then expands the CoE to incorporate portfolio management processes and effectively forms the basis of the Enterprise PMO. At this point formal structured reporting can begin to the stakeholders building support for the emerging structure

CoE

EPMOEPMO

Portfolio & Business

Board

Business Health Check

report

feedback

feedback

report


CoE


Sitting outside the EPMO is the overall governance in the form of the Corporate Portfolio Programme Board, this may simply be the senior board of the organisation.

CoE

EPMOEPMO


CoE


The Corporate Portfolio Programme Board report directly into the Corporate board or the most senior board within the organisation

CoE

EPMOEPMO


portfolio managment at os v1.0

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