Breakthrough Project Portfolio Management: Achieving the Next Level of Capability and Optimization

298 Pages·2017·6.152 MB·English

by  Murali Kulathumani

2
Copyright © 2018 by J. Ross Publishing
ISBN-13: 978-1-60427-149-2
Printed and bound in the U.S.A. Printed on acid-free paper.
10 9 8 7 6 5 4 3 2 1
Library of Congress Cataloging-in-Publication Data
Names: Kulathumani, Murali, 1974– author.
Title: Breakthrough project portfolio management : achieving the next level of capability and optimization / Murali
Kulathumani.
Description: Plantation, FL : J. Ross Publishing, [2017] | Includes index.
Identifiers: LCCN 2017040534 (print) | LCCN 2017040885 (ebook) | ISBN 9781604277920 (e-book) | ISBN 9781604271492
(hardcover : alk. paper)
Subjects: LCSH: Project management. | Information technology—Management.
Classification: LCC HD69.P75 (ebook) | LCC HD69.P75 K85 2017 (print) | DDC 658.4/04—dc23
LC record available at https://lccn.loc.gov/2017040534
This publication contains information obtained from authentic and highly regarded sources. Reprinted material is used with
permission, and sources are indicated. Reasonable effort has been made to publish reliable data and information, but the
author and the publisher cannot assume responsibility for the validity of all materials or for the consequences of their use.
All rights reserved. Neither this publication nor any part thereof may be reproduced, stored in a retrieval system, or
transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior
written permission of the publisher.
The copyright owner’s consent does not extend to copying for general distribution for promotion, for creating new works,
or for resale. Specific permission must be obtained from J. Ross Publishing for such purposes.
Direct all inquiries to J. Ross Publishing, Inc., 300 S. Pine Island Rd., Suite 305, Plantation, FL 33324.
Phone: [phone]
Fax: [phone]
Web: www.jrosspub.com
3
CONTENTS
Foreword
Preface
How to Use This Book
About the Author
WAV™ Page
PART I Key Components of a Portfolio Process
Chapter 1 The Mission-Critical Role of the High-Performing Portfolio
Introduction
Characteristics of the Optimized Portfolio
The Strategic Effect of a Well-Run Portfolio
The Concept of Portfolio Capability Maturity
Relationship of the Maturity of Portfolio Components to Overall Portfolio Maturity
Chapter 2 Portfolio Intake and Assessment
Introduction
The Ideal Portfolio Intake
Portfolio Type and Its Impact on Portfolio Intake
Role of Annual Planning
Building an Intake Solution Using a Word/Excel Template
Building an Intake Solution Using SharePoint
Success Factors for Portfolio Intake
Levels of Portfolio Capability Maturity
Chapter Summary
Chapter 3 Portfolio Annual Planning
Introduction
The Importance of Annual Planning
The Execution of Annual Planning
Pass One of Annual Planning
Pass Two of Annual Planning
Pass Three of Annual Planning
4
Key Outputs of the Annual Planning Exercise
Pointers to Success in Annual Planning
Levels of Portfolio Capability
Chapter Summary
Chapter 4 Portfolio Funding Strategies
Introduction
The Portfolio Annual Funding Cycle
The Challenges in Managing the Portfolio Funding Cycle
Best Practices to Optimize Portfolio Funding Decisions
Portfolio Funding Model
Levels of Portfolio Maturity
Chapter Summary
Notes
Chapter 5 Portfolio Performance Monitoring
Introduction
What Could Go Wrong in a Project?
Key Portfolio Indicators That Need to Be Reported and Tracked
Drawbacks of Traditional Methods of Project Performance Monitoring
Why Is R/Y/G Such a Poor Proxy for Project Performance?
mEVM: The Swiss Army Knife of Performance Monitoring
How to Use the Outputs from mEVM for Portfolio Performance Monitoring
The Enhanced Monitoring List
Levels of Portfolio Capability
Chapter Summary
Chapter 6 Portfolio Rebalancing
Introduction
Portfolio Balancing in a Financial Portfolio
Applicability of Portfolio Balancing to a Project Portfolio
The Fundamental Need for Portfolio Rebalancing
The Prerequisites of Portfolio Rebalancing
Scenarios Where Portfolio Rebalancing Is Required
Why Portfolios Find It Hard to Rebalance
An Alternative View about Project Portfolio Rebalancing
Chapter Summary
Chapter 7 Portfolio Benefits Realization
Introduction
5
Types of Benefits
Nonmonetary Benefits
The Portfolio Benefits Realization Process
Levels of Maturity
Chapter Summary
Note
PART II mEVM
Chapter 8 Introduction to mEVM
Introduction
Why Is It So Hard to Really See How the Portfolio Is Actually Performing?
Traditional Reporting Solutions and Their Disadvantages
The Advantages of Objective Indicators
A Basic Example to Introduce the Concept of mEVM
Chapter Summary
Notes
Chapter 9 The Artifacts of mEVM
Introduction
The Main Artifacts of mEVM
Chapter Summary
Note
Chapter 10 Aggregating mEVM Data for the Enterprise
Introduction
The Drivers of Aggregation
The Three Dimensions of Aggregation
The Portfolio View
The Program View
The Multi-year Project View
The Multi-Year Program View
The Multi-year Portfolio View
Consumption of Aggregated Data by Portfolio Governance
Levels of Portfolio Maturity
Chapter Summary
Chapter 11 Measuring Strategic Attainment Using mEVM
Introduction
Tactical Attainment versus Strategic Attainment
The Complicated Business of Measuring Strategic Attainment
6
How Much of Our Activity Is Strategic?
Benefits of Measuring Strategic Attainment Using mEVM
Factors of Success in Measuring Strategic Attainment
Levels of Maturity
Chapter Summary
Chapter 12 How to Roll Out mEVM to the Enterprise
Introduction
Steps to Rolling Out mEVM Reporting for the Portfolio
Important Considerations to Keep in Mind during the Rollout
Common Evasive Tactics Related to mEVM and Countermeasures
The Enhanced Monitoring List—Also Known as the Kill List
Levels of Portfolio Capability
Chapter Summary
Chapter 13 Why mEVM Works
Introduction
Why Explore Criticisms of EVM?
The Criticisms of EVM
How mEVM Overcomes the Traditional Criticisms of EVM
The Canary in the Coal Mine
Why Does mEVM Work?
Secondary Reasons Why mEVM Works
Chapter Summary
PART III Implementation Strategies for the Real World
Chapter 14 Common Portfolio Problems and Solutions
Introduction
Where Do We Start?
Chapter Summary
Chapter 15 Portfolio Information Systems
Introduction
The Reason Why Most Portfolio Management Tools Fail
What a Successful Portfolio System Looks Like
Portfolio Processes
Process #1: Intake Process and Tool
Process #2: Annual Planning Process
Process #3: Archival and Retrieval of Portfolio Decisions
Chapter Summary
7
Chapter 16 The Politics of Portfolio Management
Introduction
Why Is Portfolio Management So Political?
The Politics of Avoidance
Politics of Deflection
Playing Politics versus Being Politically Correct
The Expendables
Levels of Portfolio Capability
Chapter Summary
Chapter 17 Portfolio Governance
Introduction
What Is Portfolio Governance?
Two Fundamental Modes of Portfolio Governance
Orchestration of Routine Portfolio Governance
Orchestration of Annual Planning Portfolio Governance
Enabling Governance: Support Systems
Exploring Governance Composition
Success Factors for Governance
Cautionary Note about Governance
Levels of Portfolio Capability
Chapter Summary
Note
PART IV The Support Systems that Decide Success
Chapter 18 Role of the Chief Information Officer
Introduction
A CIO’s Mandate
How the CIO Is the Biggest Beneficiary of the Portfolio Office
How the CIO Is the Biggest Enabler of the Portfolio Office
Levels of Portfolio Capability Maturity
Chapter Summary
Chapter 19 Finance
Introduction
Interface Points between Finance and the Portfolio Office
A Symbiotic Relationship
How Finance Benefits from the Portfolio Office
Levels of Capability Maturity
8
Chapter Summary
Note
Chapter 20 Portfolio Rollout and Change Management
Introduction
The Wide Spectrum of Portfolio Rollouts
Why Do Portfolio Rollout Efforts Often Fail?
The Politics of Portfolio Change Management
Recommended Best Practices for Portfolio Rollout
What Is a Mind Map?
How to Use the Mind Map
Pointers for Success in Using the Mind Map
Levels of Portfolio Capability Maturity
Chapter Summary
Chapter 21 The Portfolio Office
Introduction
Description of an Ideal Portfolio Manager
Strategies in Staffing the Portfolio Office
Typical Composition of the Portfolio Office
Portfolio Office’s Reporting Structure
Levels of Portfolio Capability Maturity
Chapter Summary
Chapter 22 The Business
Introduction
A Perception Problem
Levels of Maturity
Chapter Summary
9
FOREWORD
It gives me great pleasure to write the foreword for Murali Kulathumani’s new book,
Breakthrough Project Portfolio Management. Throughout my career in information
technology and presently as chief information officer (CIO) of a Fortune 500 company, I have
always found the discipline of portfolio management to be a valuable aid in choosing and
monitoring investment choices. I’ve found that portfolio management can make the
difference between mere project activity and meaningful achievement of capability.
Part of the challenge for me has been to visualize a road map of capabilities for the
discipline of portfolio management so that we can plan to take our organizations to the next
level of maturity. In my opinion, while there are many good volumes about portfolio
management in the market today, this new book is one of the first to propose an easy-to-use
model of portfolio capabilities and the different levels of attainment.
Another aspect of portfolio management where I have felt there could be a more detailed
exploration has been the gap between portfolio theory and the realities or constraints
encountered in real life. While the theory of portfolio management is well established, there
remains a considerable gap in applying this theory to the varied situations that are
encountered in organizations today. Every organization is in a different place in terms of
process maturity, and I believe there is always a need to address the gap between theory and
practice. This is where this book plays a valuable role in making the reader aware of how to
navigate the space between the ideal and the real, while delivering on the promise of portfolio
management.
A third aspect of this readable book that appealed to me was its adaptation of earned value
management tailored for portfolio management. While the discipline of earned value
management has been a proven workhorse in the defense and construction industries, the
perception of high rigor and effort around this technique has prevented it from being more
widely adopted. This book has approached this standard technique in a new way, distilling the
most essential aspects into a simple set of artifacts that should be easy for most organizations
to use. The use of this modified form of earned value management to serve as an objective
indicator for project and portfolio performance is useful in providing executive decision
makers with the tools to make data-driven choices. The book not only introduces this
simplified technique, but also goes on to build upon that same foundation, an extensive
methodology to aggregate data for easy visualization by executives. I also found it valuable
and thought provoking to peruse the detailed chapter on providing concrete metrics on
transformational strategy attainment using the modified earned value method.
From a CIO’s perspective, perhaps the most compelling feature of this book is the detailed
exploration of how the portfolio office and the CIO are connected in the delivery of value to
10