Managing project portfolios - are project issues chewing you up and spitting you out?

AUTHOR: Cameron Cooper   DATE: 01.05.07   ISSUE 1, 2007

Increasingly, organisations of all sizes in all industries are investing significant money, people and strategic resources in selecting and managing a portfolio of projects. Research demonstrates that most projects fail not because of a lack of potential but due to poor project selection, sponsorship and leadership.

Craig Tapper, an adjunct lecturer in postgraduate business programs at the Australian School of Business™, says chief executives and senior executives too often launch projects on a whim and have an illogical or impulsive commitment to them. Some projects can become “sacred cows”.

AGSM's new Managing Project Matters course focuses on successful and effective project implementation.

Illustration: Gregory Baldwin

“The CEO comes back from a conference inspired by listening to an expert, for instance, or a manager reads an article in the newspaper and says ‘we should be doing something like that’. The upshot is that time, money and effort are wasted on some projects, while other potentially more important projects fall by the wayside.”

Mr Tapper says strategic management of projects requires business leaders to select projects on the assumption that it has scarce capital, people and time to invest. “You need to nurture the project resources in your organisation to get the best returns on these investments.”

A new course of action
The growing importance of managing project portfolios effectively is reflected in the AGSM’s launch of a new three-day non-residential course, Managing Project Managers. It is designed for those who are managing the project managers, “not the project managers themselves who need to be able to read a GANTT chart and understand what it’s telling them, but the project sponsors who the project managers report to.”

Projects can be complicated. They often entail a complex web of people and resources, contracts with outside agencies and management of relationships with key internal and external stakeholders.

For strategic managers, a portfolio of projects can present a bewildering array of competing demands for resources, investment and attention. The AGSM course helps managers navigate their way through this maze.

“You need to nurture the project resources in your organisation to get the best returns on these investments”

“Our clients and research are telling us that getting the implementation right is important, and that’s what we’re trying to do with this program,” says Mr Tapper, the program director of the new AGSM course.

With the initial programs to be run in June and October this year, Managing Project Managers will help attendees address the following issues:

· Screening in order to select the right portfolio of projects in which to invest scarce resources.
· Understanding the key technical aspects of project management to sponsor, lead and oversee project teams effectively.
· Choosing the right project managers and teams, and keeping them focused and motivated.
· Ensuring managers gain and maintain organisational commitment and support for project portfolios.
· Identifying and overcoming common barriers to effective project management and implementation.
· Extracting maximum return from an organisation’s portfolio of strategic and operational projects.

Some key questions
Mr Tapper says organisations need to ask some basic questions before embarking on new projects.

How will starting another project affect the projects already in play? Will the new project provide a better financial or strategic return than present projects? Does the company have sufficient resources or can the components of some projects be outsourced?

“A lot of senior managers just keep picking up more and more projects without actually looking at how that’s going to affect what they’ve already invested in projects,” he says. “Time, money, people skills, systems and relationships – all the things that you need to manage.”

The AGSM program offers executives templates and principles that help businesses successfully manage a diverse portfolio of projects, initiatives and strategies. It provides a platform for managers to grasp a basic understanding of project management techniques such as project assessment and goal setting, project briefing, project planning, scheduling, control, monitoring and review. Then it builds on this knowledge through strategic, portfolio, people and resource management techniques.

Participants move from project conception through to ways to execute plans, balance competing priorities, manage structural and cultural barriers and maximise value for an organisation.

A three-stage learning process is adopted: first, short classroom sessions provide tools, techniques and principles; second, team-based case studies or guest speakers give context and allow participants to apply concepts and models; and third, reflective sessions allow managers to consider the implications for an organisation. At all stages the program is team-based, practical and highly interactive.

Business leaders must select projects on the assumption they have scarce capital, people and time to invest, says Craig Tapper, program director of Managing Project Matters.

Photo: Craig Tapper

A range of skill-sets
At the end of the new AGSM course, participants will come away with a range of skills:
· an ability to identify the right projects or initiatives to undertake.
· the tools to understand and identify project plans with the best chances for success.
· an understanding of the most effective project management processes, practices and policies
· the skills to identify and manage key project stakeholders.
· the principles and guidelines for effective project leadership and management.

Mr Tapper suggests the repercussions of taking on too many projects, or the wrong projects, are serious.

“You can end up with projects that go well over budget and deadline,” he says. Worse still, staff become discouraged and lose motivation as they are switched from one project to another without ever seeing them come to fruition.

Senior management can also erode their credibility as they commission – and then abandon – a series of projects, prompting an attitude among staff that “here’s another one of these projects we’re going to start but never finish”.

While CEOs and senior managers are often held accountable for a failed project, Mr Tapper says they should not shoulder all the blame: it is also up to project managers to keep their bosses in check.

“We need managers who can make really good business cases for a project,” he says. “If a project has a weak business case, go back and work on it until you can come up with a compelling argument as to how the organisation is going to be better off.”