program and portfolio management

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G00262965

Program and Portfolio Management Key

Initiative OverviewPublished: 8 April 2014

Analyst(s): Robert A. Handler

This Key Initiative Overview provides a high-level description of the Program

and Portfolio Management Key Initiative. IT leaders can use this overview to

contextualize what they need to manage programs, set up a PMO and

prioritize investment demand through portfolio management.

Analysis

Figure 1. Program and Portfolio Management Key Initiative Overview

Source: Gartner (April 2014)


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Program and portfolio management (PPM) is a discipline central to helping organizations realize

strategy, develop core business capabilities, manage ongoing change and optimize IT project

investments.

Today's hyperconnected, fast-paced world places inordinate demands on already stretched IT

organizations to change rapidly. PPM provides the best mechanism to proactively address constantchange. For truly effective PPM, an enterprise must understand its investment goals, put them into

context vis-a-vis the organization's overall capabilities and risk tolerance, and factor in the external

environment.

Optimizing return on investment at the portfolio level requires balancing what's desired against

what's possible in the long term and what's possible now. PPM moves an organization to a higher

level of thinking in terms of projects' value that is, whether a project or selection of projects is the

best investment choice, given other projects' or programs' value, the availability of the right

resources, and the organization's internal capabilities and tolerance for risk. PPM is really about

getting the right things done in the right way.

Gartner research on PPM is designed not only to provide the tools to help clients determine at the

outset whether work is best managed as a project or a program including providing guidance to

the people in the organization who do the actual project work but also to make "go or no-go"

decisions as programs and projects proceed.

Consider These Factors to Determine Your Readiness

Before undertaking the complex task of delivering value through PPM activities, CIOs need to

prepare the organization by mapping out a vision, strategy and objectives for the organization,

outlining how they will:

Determine the organization's maturity and its cultural predisposition for and against the

structural and process changes that will be necessary to define and establish a project

management office(PMO), as well as the organization's program and portfolio disciplines.

Determine whether the organization has the appropriate staff for the work. If not, develop or

recruit staff with the skills and talents for all three endeavors establishing and running a

PMO, managing programs and projects, and establishing and supporting a project portfolio

process.

Determine how resources for projects and programs will be managed and located in the

enterprise.

Establish appropriate metrics to determine the contribution of these three endeavors to the

success of the planned projects and programs.

Select appropriate PPM tools.

What Program and Portfolio Management Means to IT Leaders

Any major initiative requires a full understanding of the needs and desires of all the players. This is

more important than the mechanics of setting up and organizing the work. IT leaders must:

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Assess the organization's processes and procedures to determine where and how changes or

disruptions may occur.

Establish plans or contingencies for reorganization that accommodate systemic changes.

Determine how to reallocate and manage resources for programs and projects locatedthroughout the enterprise.

Anticipate how the PMO's contribution to project and program success will be measured.

Select appropriate project, program and portfolio management tools.

Conduct Your Program and Portfolio Management Initiative Using This StructuredApproach

Strategize and Plan:Draft a charter to gain agreement on the vision for the initiative that aligns

with business goals. Scope the initiative, and establish resources and budget. Integrate with

strategic IT and business plans.

Develop Governance:Establish an optimal process for making decisions and assigning

decision rights. Identify and engage stakeholders. Agree on authority and flow for decision

making. Implement and set up feedback mechanisms.

Drive Change Management:Set up a system to communicate ideas via multiple channels. Get

buy-in from stakeholders at all levels. Assess progress, and drive stakeholder commitment to

the change. Be sensitive to the amount of change PPM efforts will entail.

Execute:Optimally operate the initiative in accordance with business goals. Update and drive

new elements of the initiative in response to changing business requirements.

Measure and Improve:Measure how the initiative has affected business outcomes. Seek

feedback from stakeholders. Drive improvements through process changes and upgrades.

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