A definition of project portfolio management based on a multiple perspective analysis
Thesis (MBA)--Stellenbosch University, 2011.
Organisations are continuously involved in the process of selection, prioritisation and execution of projects in order to achieve some stated objective, within the constraints of a finite set of resources. The problem that many organisations face is how to go about making the decisions to maximise the value of the investment in these projects. Project Portfolio Management (PPM) is a management concept that facilitates and support the decision-making processes to ensure that the optimal mix of projects in a portfolio supporting a particular organisational objective. However, there is no generally accepted standard definition of PPM. This absence of an accepted definition can lead to confusion when organisations implement PPM. A well-defined, accepted standard supported by qualifying criteria will thus enable organisations to make informed decisions about the application of PPM. It will also lead to a better understanding of the PPM value proposition. The purpose of this report is to define exactly PPM entails. It recommends a standard definition that will enable an organisation to understand the use and benefit of PPM. The author reviewed the many different definitions of PPM from different perspectives namely: academic literature, industry bodies, popular press, software vendors and consulting groups. A critical review of the literature was performed to clearly define the concept. All of the different definitions were reviewed and compared within, and amongst, the different perspectives. The final definition of project portfolio management is presented as follows: Project Portfolio Management is a strategic management concept with the objective of ensuring that the portfolio of projects is aligned with and support the organisational strategy. This is done through the integration of strategic and operational management levels within the organisation. An important insight of the research is that projects, and portfolios of projects, can be considered as change initiatives and investments the organisation has made, or plans to make in future. Within this context PPM is positioned on a strategic management level within the organisation to assist in bringing about the change in the correct manner. PPM involves a dynamic decision-making process (defined in this report) where the selection and prioritisation of projects to be executed is done within the constraints of a limited pool of available resources. The selection and prioritisation of projects is determined by a defined set of criteria discussed in this report.