1
The Context of Programme Management
1.1 Definitions of projects, programmes and portfolios
Project
Projects are needed in every industrial sector, and several definitions of the term ‘project’ exist today. Some of the most commonly used definitions are listed below:
These definitions collectively recognise temporary and transient nature as the two fundamental characteristic of a project. Projects are temporary in that they have a definitive start and an end. They are also transient because they are completed as the organisation moves from one project to another at a different location and so on. Projects are created to achieve agreed objectives and produce and deliver a product, service or result. The involved parties need to agree to the objectives, and the partner tasked with achieving the objectives needs to first produce and finally deliver what has been set in the objectives.
The CIOB Code of Practice for Project Management (fifth ed., p. 317) defines project as:
The task of project management is to bring in at the right time and co-ordinate many different professionals and specialists to enable them to achieve the agreed objectives. To do this effectively, project managers need to manage key business functions for a project.
Programme
Programme is different from a project, but the two terms are often used interchangeably. Some of the notable existing definitions recognise the following:
Programmes comprise multiple related projects, and that by itself makes a programme distinctly different from a project. Programmes are often ongoing, with a number of milestones, and do not necessarily have the strictly finite nature of a project. Even when a programme has an end date, the time scheduled is normally far longer than any project within this programme. Unlike projects, programmes are created for horizontal co-ordination of projects, which often run in parallel.
From a business and customer perspective, a programme is a temporary organisation designed to operate, learn and adapt in a complex environment of interrelated projects, people and organisations. In this context, the programme manager is the chief executive officer of a temporary organisation with the ability to carry the flame for what users want.
A programme therefore comprises a collective of related projects which are limited in time and designed to individually deliver agreed upon objectives and which produce and deliver a product, service or result. The coordinated manner by which they are managed delivers programme benefits that are greater than the sum of individual project benefits were they not coordinated at the programme level. Success of a programme is thus dependent on a programme team’s ability to deliver those benefits.
In the context of construction, CIOB defines a programme in the following way:
From a summary point of view, a business or a client define strategic objectives that are implemented through a programme of interrelated projects internally delivered or outsourced to specialist supplier and/or contractors.
Projects in a programme may be related in different ways. For example, a number of projects that collectively need to be managed to deliver a set of benefits in order to address client’s objectives are related through client or customer/end user (see Figure 1.1).
Figure 1.1 Establishing relatedness.
On the other hand, a number of projects that collectively need to be managed to deliver a set of benefits in order to address construction organisation’s strategic objectives are organisationally related (see Figure 1.2).
Figure 1.2 Organisationally related projects.
The task of programme management is to create and co-ordinate a collective of related projects in order to deliver programme benefits which would not be as achievable if they are managed as a group of individual projects.
Portfolio
The existing definitions of ‘portfolio’ recognise that organisations are involved in a number of programmes and projects at any given time that may or may not be related.
However, a portfolio is not a random collection. Organisations need to achieve their strategic objectives, so they carefully consider the kind of projects and programmes that constitute their portfolios. CIOB defines portfolio in the following way:
The task of portfolio management is to manage and maintain all of an organisation’s projects and programmes to help achieve its strategic objectives. The organisation’s ongoing business may be project-based and/or require projects and programmes to achieve the desired change to sustain its business.
Figure 1.3 summarizes the key characteristics of project management, programme management and portfolio management as set out above.
Figure 1.3 Key characteristics for projects, programmes and portfolios.
1.2 Understanding programme management: is there a programme?
When is it a project?
An undertaking is considered and executed as a project when:
- the delivery criteria, scope, quality, cost and time can be defined and measured
- the delivery structure and methodology is known and available
The output/benefits resulting from the project may or may not deliver the total outcome required by the undertaking’s initiator.
When is it a programme?
An undertaking is considered and executed as a programme when:
- the delivery criteria may or may not be fully known, defined or approved
- the undertaking requires a high level of regulated governance
- achievement of the overall outcome required necessitates a number of related projects, each demanding different specialist skills, expertise or organisational approaches
- the size, complexity and uncertainty of the undertaking are such that delivery is best approached by creating a number of projects
- the delivery skills required are beyond the organisational and contractual arrangements for one team
- the geographic spread of the undertaking makes it uneconomic or infeasible to have one project
- time or cost constraints mean that it is uneconomic or infeasible to have one project
- there is a requirement to manage interdependencies between projects
- there is a requirement to manage conflicting priorities and resources across projects
When is it a portfolio?
An undertaking is considered and executed as a portfolio when:
- the programmes and projects comprising the undertaking are discrete, with no related or shared output
- there is a requirement to manage priorities and resources across programmes and projects
- there is a requirement for high-level governance and monitoring of the programmes and projects
A portfolio can relate to an organisation’s total activity or to specific undertakings
1.3 Programme management in the built environment
We have defined the terminology for projects, programme and portfolio, change and programme management practices in the context of a business organisation. We now consider these in the context of the built environment.
Change management addresses introducing new things or doing things better for continuous improvement: delivering organisational changes (building new or improving existing assets) while managing quality and risk, as well as producing measurable and sustainable benefits adding value to operating business models.
Programme management brings reality and method to strategic planning and to the delivery of strategic change with the right strategic objectives phased and delivered on cost, on time, on quality and on benefits.
Project management is deterministic, learning rules and applying them well, and delivering output and products or single assets.
Portfolio management encompasses programme or projects that are not necessarily linked, collectively delivering a strategy.
Programme management in this context is illustrated in Figure 1.4 in a circular, continuous process running from strategy (top left corner) to operations and benefits realisation (bottom left corner). It is contained between business as usual, strategizing and realising benefits while operating a business or an organisation and (right-hand side) planning and managing a programme to deliver outcomes and benefits (see Figure 1.5).
Figure 1.4 Programme management in context.
Figure 1.5 Programme delivery in built environment.
In the context of the definitions as outlined in this document, many major projects are actually programmes comprising several related projects, but they have not been treated as programmes. The construction sector has gradually shifted the focus from products to services, where a product is one of the deliverables. Now, programmes and their associated projects don’t just deliver buildings, they deliver a product, benefit or outcome which adds value their customers seek (i.e. ‘servitization4’). Such an outcome calls for a holistic approach that may well require several very different, yet related projects delivered for the same client (e.g. several building projects, infrastructure projects, training projects, IT projects, etc.).
The London Olympics 2012 represents a good example of a programme where individual venues, infrastructure, legacy and so on each represented separate sets of related projects all under the umbrella of the Olympic Delivery Authority (ODA). The ODA were tasked to act as programme manager to achieve the desired benefits that would not have been achieved had they been managed individually.
The traditional linear delivery cycle for projects offers a robust model for programme planning and delivery. Using this model, an effective programme will anticipate and integrate organisational changes within financial, contractual and physical constraints as time passes. Innovation through clarity of strategic intent and creative design coupled with adapted controls (risk management and change management) is critical to successful scope delivery (on time, to budget and quality) and benefits realisation. The programme and organisational structure (including resource levels) will be gate controlled and will evolve through each delivery phase.
1.3.1 Corporate social responsibility (CSR)
Programmes and their associated projects need to embrace all the aspects normally associated with CSR and preferably some that go beyond ‘responsibility’ and ‘compliance’ and into the realm of voluntary environmental and social benefit.
Ideally, this will develop into a corporate business model, with self-regulation to ensure active compliance with both the literal meaning, and spirit, of the law.
CSR should consider and provide benefits in sustainable development, including an agenda which continually reduces the carbon footprint for each of the associated projects, where appropriate. It should begin by embracing all legislation associated with health and safety, environmental assessment, energy, waste and pollution, then progress through regular monitoring to achieve the maximum benefit for users, the environment, and the client organisation and its stakeholders.
CSR encompasses a number of disciplines associated with programme management, namely, sustainability, ethics, and health and safety, as well as the promotion of positive social and environmental change.
1.3.2 Sustainability and the environmental mandates
Environmental performance and impact, together with the other sustainability elements of ‘economic’ and ‘social’, may be particularly important to the client.
Environmental mandates include requirements for the environmental performances within related projects which comprise the programme. This includes all requirements on carbon emissions and energy consumption.
In addition, it may also prescribe requirements for the environmental impact on local topographies or areas adjacent to related projects. It may determine outcomes in terms of associated communities, such as providing employment and training opportunities or the use of supply chains.
Finally, the environmental mandates should also outline the overall environmental management criteria for related projects, including the key success factors for the related projects in terms of environmental management.
1.3.3 Ethics in programmes: business and professional
Programmes encompass a wide range of organisations and individuals, which may be divided into business and/or professional relationships. These parties vary in their practices, procedures, negotiations, management styles and financial and business processes. But all need to have ethical standards of trust and behaviour which are mutually acceptable, even if they contain variations, if their relationships within the programme are to be successful and sustainable.
Business and professional ethics need to comply with the local and business legal and statutory requirements. These should conform to the respective government legislation along with accepted international practices and relevant national and international professional standards.
1.3.4 Health and safety standards and requirements
Generally, the UK laws governing health and safety relate to all construction, manufacturing and engineering and are not industry specific. Good practice should be adhered to throughout all projects and programmes, irrespective of the location of the projects or programmes.
For further details see Briefing Note 3.01 (the CIOB code of Practice for Project Management, fifth ed. 2014, p.113).
1.4 Types of programmes
In the context of the built environment, programmes may be categorised in three key types, as illustrated in Figure 1.6, depending on the driver for change. These are (i) vision-led programmes which are necessarily top driven and set out to meet a particular strategic vision or need, (ii) emergent programmes, where the organisation recognises that a group of existing projects would be better managed together (a bottom-up approach) and (c) compliance programmes which are created in response to internal or external stimuli, often generated outside the control of the organisation.
Figure 1.6 Types of programmes.
All programmes, regardless of the driver and type, introduce change: internal or external or even both internal and external.
Example 1: Vision-led programmes
Reducing the carbon footprint of existing and new hospitals is a vision which requires a number of diverse retrofit and new-built projects according to commonly accepted standards, staff training, logistics and other projects. Mobilisation of vast resources across geographical regions calls for co-ordination far beyond the needs of a single project.
Example 2: Emergent programmes
An organisation facing similar problems in several existing projects recognises that they need to be addressed across all projects. For example, some common factors that lead to delays and other types of losses need to be addressed holistically and solutions developed and implemented in all projects. A programme could then be formed by pulling together existing projects to develop and implement solutions across all projects in the programme.
Example 3: Compliance programmes
A change in facilities-related legislation could force an organisation with a large number of facilities to form a programme to implement the necessary changes across all facilities. Large organisations where compliance-related changes normally lead to the formation of programmes designed to implement the necessary changes normally need to maintain in-house programme management capacity.
1.5 Range and scope of programmes
Programmes can be of different sizes and complexity. Some will a number of dozens of projects over many years or continuous programmes with major milestones. Other programmes will be fairly small with only a few of projects, but regardless of the size, all programmes should achieve benefits set by the strategic objectives.
Programme scope should thus clearly spell out the anticipated benefits for using a programme mandate and or a programme brief and how a collective of projects aims to achieve those benefits to accomplish the strategic objectives. The benefits realisation process is thus a prerequisite for setting strategic objectives and in its initial phase defines the required projects to achieve the desired benefits.
1.6 Need for programme management
The need for programme management arises from the expectation that programme benefits obtained in a coordinated manner are usually greater than the sum of individual project benefits obtained in isolation. Programme management looks at overall benefits (i.e. programme optima) and helps individual project managers running their projects relative to other projects in the programme in terms of their progress, risks, resource requirements and sharing, knowledge sharing, issues, constraints and so on (see Section 4.3).
If projects are managed in an uncoordinated manner, individual project managers may use different tools and techniques, rendering any meaningful comparison of progress impossible. In addition, any resource and knowledge sharing would be left to chance or the willingness of individual project managers to share. In this way, programme management is a systematic approach to project grouping for the purpose of achieving common goals and overall benefits without leaving the process to chance.
1.7 Programme management process and stages
Whether in mature economies or in emerging markets, countries and organisations are looking for creative solutions to achieve their long-term vision and fulfil their citizens’ and customers’ needs. Government and business managers have to find ways to be both strategic and more efficient in developing and directing funding and managing strategic change programmes, in order to deliver their intended benefits.
The speed, scale and disruptive nature of change in the global economy, acceleration of knowledge distribution and technological improvement have led organisations to undertake more risky and unique initiatives into unknown territories.
Managers and their organisations are required to introduce strategic change in order to be more competitive, improve profitability, reduce effort, improve working environment, deliver better products, stimulate teamwork or achieve higher client satisfaction. They seek to improve an aspect of production or quality, to reduce delays or to build new assets or whatever management thinks will improve the triple bottom line.5 And change is never easy, so managing change effectively within an organisation is vital to its success.
This section describes the approach for effective programme delivery using examples.
The following stages, illustrated in Figure 1.7, determine a framework for through-life managing of programmes:
- Stage A: Programme inception
- Stage B: Programme initiation
- Stage C: Programme definition
- Stage D: Programme implementation
- Stage E: Benefits review and transition
- Stage F: Programme closure
Figure 1.7 The programme’s life.
Stage A: Programme inception
It is the programme sponsor’s responsibility to outline programme vision, objectives and benefits. Vision statement and programme mandate are the two main outputs at this stage. However, optimum benefits may require a much more detailed benefits identification process managed by a business change manager and/or a benefits manager. There should be a clear need for a programme, and this need must arise from the desired benefits that have been previously identified (i.e. benefits register). This iterative process is important, particularly as benefits may be accompanied by dis-benefits, unintended benefits and consequential benefits that may not be immediately obvious.
Stage B: Programme initiation
A programme manager may be appointed at this stage to work along with the benefits manager in order to achieve the desired benefits. A programme manager develops a programme brief and, through identified benefits, produces a detailed business case, which is either accepted and the programme is given a go-ahead or rejected and potentially sent for review. Once the programme is accepted, the programme manager establishes governance mechanisms and develops the relevant plans.
Stage C: Programme definition
In some cases, a programme manager is appointed at this stage, but the overall goal at this stage is to have a fully functional programme management office (PMO) to develop the programme delivery plan (PDP). Identified benefits should be reviewed at this stage and detailed benefit profiles developed in order to produce the benefits realisation plan. This is accompanied by the projects register to enable programme-wide monitoring for the purpose of achieving programme outcomes.
Stage D: Programme implementation
Each project in a programme makes a contribution towards achieving the overall anticipated benefits, but these may be accompanied by dis-benefits and consequential benefits so it is important that their contribution is implemented and reviewed at regular intervals. While some benefits will be immediately realisable, most will only be fully achieved once the programme has closed or is undergoing a complete cycle review. Programmes may be very long, so these regular review points can be used to make necessary alterations in forthcoming projects in case there is an indication that a planned course may not produce the desired outcomes and benefits. In addition, this stage monitors and controls the established programme across all of its constituent projects. This includes appointment of project managers, performance of individual projects, interfaces between projects, benefits realisation, financial expenditure and programme changes.
Stage E: Benefits review and transition
In addition to regular review points, continuous programmes need major reviews after the anticipated benefits have been fully achieved to address the changes in strategic objectives or any external changes that lead to further projects and continuation of the programme. If a programme is not to be resumed later, then there will be a point when it needs to be closed. The closure of a programme needs to follow the programme outcomes review processes to establish whether the programme has delivered the outcomes as set out during stages A and B. Programme closure must demonstrate that benefits have been achieved and projects are completed successfully, review the performance of the programme, identify best practice and lessons for future programmes, update the benefits register and ensure ongoing benefits realisation after the programme has closed.
Stage F: Programme closure
At the point at which the programme sponsor has agreed that the required outputs and the outcome defined in the PDP has been achieved and no further works are envisaged, the programme is considered complete. The stage involves the controlled shutting down of the programme activities and the disbanding of the programme team.
1.8 Programme organisation structure
As described in Section 1.3, in general programmes may be vision led, emergent or compliance based (driven by an external pressure). That means some programmes will be internal, but others will be developed on behalf of an external client. Regardless of the case, a programme is always developed to deliver benefits to a client (internal or external).
Figure 1.8 shows an example of a programme organisation structure.
Figure 1.8 Programme organisation structure.
In terms of the nature of business, approaches and structure, the private sector is far more diverse than the public sector. However, it is common that interim or final outcomes and deliverables will need to be reported to a board of directors.
1.8.1 Types of clients who may initiate programmes
Clients are ‘person (s) or organisation(s) using the services of a … professional person or organisation’6 or ‘organizations or individuals for whom a construction project is carried out’7. In the context of the built environment, they may be defined as the body or group that procures the services of professionals or a customer who buys goods or services from a supplier or business.
In the programme sense, this document defines clients as the body or group that procures the services of professionals to initiate and deliver projects or a programme of projects. It is the clients who represent their organisation or the stakeholders, such as shareholders, who will engage professionals to initiate a programme of projects. These projects may indeed include non-construction projects, for example, IT, HR (human resources), and so on, as well as construction projects.
The client and the client’s organisation will usually ‘own’ the programme and the projects, which may be from the public or private sector and likely to have obtained their own funding. The ‘sponsor’ may hold a similar position, but in construction development the sponsor is the person who normally represents the client and is usually in charge of the funding arrangements as well as serving as the main representative.
Programmes vary considerably in size and form in the same way that projects do. However, as programmes include multiple related projects, they have a tendency to be larger, be at a more ‘strategic’ level and take place over a longer time period than individual projects. Programme clients therefore are often at an established senior level in industry or government and may have progressed from being a client for a single project.
Alternatively, the programme may have started as just one or two related projects, or even a small group of projects, which has then enlarged to encompass even more projects over a longer time period. This extension could be caused by a variety of factors, such as new ownership or leadership, revised shareholder or stakeholder policy, new merger or acquisitions, planned or unplanned change in corporate strategy, increase in funding availability, etc.
The following lists typical organisations that may be public or private programme clients or sponsors, each having its own representative who could be termed the client, sponsor or programme manager. All at some point may have previously acted as a project client.
Typical public clients:
- Central government
- Local government
- Government departments
- Health
- Education
- Heritage
- Transport
- Energy
Typical private clients:
- Banking and finance
- Retail
- Hospitality and leisure
- Manufacturing
- Food and beverage outlets
- Developers
1.8.2 Client organisation structure
Whether controlling single or multiple programmes, clients will allocate a number of roles overseeing the delivery of the programme. These may include the following groups or individuals:
Programme sponsor
A programme sponsor (PrgS) outlines programme vision, objectives and benefits. Directly responsible for developing the vision statement into the programme mandate, a PrgS’s key responsibilities include:
- strategic direction and fit with the overall business strategy
- releasing the required resources
- ensuring programme stability in terms of time, budget and scope
- championing the programme at the most senior level
- providing high-level feedback on programme progress
The role of programme sponsor is a very senior position requiring visionary capabilities and competent leadership skills acquired from leading diverse senior teams.
In some organisations the programme sponsor role may be known as the senior responsible owner or the programme director.
Programme sponsor’s board
The programme sponsor’s board (PrgSB) will have the authority to make key decisions and commit expenditure on the programme on behalf of the sponsoring organisation. It will consist of executive-level individuals who are heads of functions of either the sponsoring organisation or of the final commissioned enterprise. Membership of the PrgSB needs to be ratified at the highest level, by the executive board or chief executive officer of the sponsoring organisation.
Throughout the programme the role of the PrgSB is to provide the overall strategic direction, support the programme sponsor in the implementation of the programme, ensure that adequate resources are available to the programme, monitor the programme’s progress towards achieving the required outputs, facilitate the resolution of any major issues, determine when the programme’s objectives have been achieved and ratify closure of the programme.
The PrgSB may also be known as the programme steering committee.
1.8.3 Programme management structure
The complexity of delivering a programme requires a team of highly experienced and skilled managers, which will include the following individuals or groups.
Programme manager
The programme manager (PrgM) coherently manages programme stages, reports to the programme sponsor and is responsible for the delivery of the proposed change. Key responsibilities include:
- developing and maintaining a project-supportive programme environment
- working with PrgS to ensure the programme is delivered on time, within budget and scope
- managing the PMO
- delivering programmes successfully in terms of agreed objectives and identified benefits (i.e. programme finances and benefits)
Programme manager is a senior appointment. The person in that role must have the necessary skills to implement the programme. In addition to core project management skills, a programme manager should have:
- sound understanding of business case development
- good knowledge of key programme-level financial and business indicators
- senior-level credibility to effectively support project teams
- excellent stakeholder management skills
Programme management board
The programme management board (PrgMB) is composed of senior managers of the programme management structure and provides advice and support to the programme manager. Its key responsibilities include:
- reviewing progress
- highlighting and resolving any issues that may be hindering progress
Programme management office
The PMO is a central support unit that supports the programme manager in overseeing day-to-day operation of a programme. A PMO includes a PMO manager and other specialist staff to carry out the functions required to:
- develop the programme delivery plan
- develop and maintain standards
- establish the governance controls
- manage programme documentation
- enhance capability to deliver the programme
Business change manager
Whereas the principal expertise of the PrgM is in managing the successful delivery of the programme in accordance with the required outcomes, the role of the business change manager (BCM) is much more focused on ensuring that the programme delivers the necessary business benefits. The BCM serves as the linchpin for the sponsoring organisation, the programme and the finished undertaking by ensuring the objectives have been sufficiently and accurately defined by managing the transition arrangements between the programme and the undertaking and by determining whether the intended benefits of the programme have been realised. The depth of knowledge and understanding required of the sponsoring organisation, and the way it operates, together with what is required from the new undertaking and the impact this will have on the existing operations, means that the BCM is likely to be a senior manager from within the sponsoring organisation.
In some organisations the BCM function may be called the business case manager.
Benefits realisation manager and/or business change manager
The programme benefits realisation manager (BRM) supports the PrgM by taking the responsibility for benefits identification, mapping and realisation. In effect, the BRM ensures that the programme delivers the necessary business benefits. The role of the BRM is to develop benefit profiles, assemble the benefits realisation plan, carry out benefit reviews and measure the effectiveness of the benefits.
Programme financial manager
The programme financial manager (PrgFM) deals with complex issues around tax liability, capital allowances and programme funding and is responsible for the programme financial plan, programme budget and financial reporting.
Considering the complexity of programmes at the interface between programme and business environments, the PrgFM should have sufficient experience with financial accounts and reporting in a project-based business environment.
Programme communications manager
The programme communications manager (PrgCM) supports the programme manager by managing all internal and external communication channels. The PrgCM develops the programme communications plan and must have sufficient experience with public relations as well as internal communication protocols within a project-based environment.
Programme monitor
In certain privately funded programmes, a programme monitor (sometimes known as funder/lender/investor’s advisor or monitor) may be appointed on behalf of the funding entities to safeguard the interest of the funders.
The scope of services for the role of a programme monitor will depend on the individual programme(s) and its stage in the programme lifecycle.
Functions of programme monitor may include:
- representing the interests of the funding business partner(s)
- attending with the funder monitoring meetings between the programme commissioner and programme’s delivery partners at agreed upon intervals
- monitoring the programme risks, in particular to those influencing funding, cash flow and potential income streams, and report back to the funder
1.8.4 Business partners
Programmes are likely to consist of a collection of organisations that have an active interest in the undertaking. These interests may be a shared ownership of the programme, shared governance, a financial sponsoring interest or an operational interest.
1.8.5 Stakeholders
Stakeholders include persons and organisations that have an interest in the strategy of the organisation and programme, have an impact or are impacted by a programme.
Programmes and organisations have to identify all stakeholders and assess the level of power they hold to affect the decisions and outcomes of the programme.
Stakeholder can be divided in two groups:
- Internal stakeholders: members of the organisations and those with an economic or contractual relationship with the programme
- External stakeholders: those with interest in the organisation and programme activities or those impacted by the activities in some way, such as governments, the public, interest and pressure groups, media and news organisations, local communities and statutory authorities
A list of common stakeholders may include the following:
- general public (people who are only indirectly effected by a programme but who may have a significant influence on its realisation)
- community (people who are directly effected by a programme through their geographic proximity to programme works)
- employees (delivered changes and benefits will directly impact employees of the client organisation)
- shareholders (individuals or legal entities owning shares in the client organisation undergoing change that are affected by the business change)
- end users (those who will ultimately work in new facilities provided or who will be the benefices’ of the outcomes of the programme)
- customers (customers of client organisations who will be affected by the business change)
- statutory and regulatory authorities (most programmes will be subject to a range of organisations that will impose restrictions on the way they can be implemented)
- interest groups (the members of which share common interests and control some area of activity, e.g. non-profit organisations and voluntary organisations)
Programmes need to identify and map the stakeholder landscape to engage and communicate effectively. To assess the level of engagement required and the impact stakeholders will have in meeting the objectives of the programme, a stakeholder map (see Figure 1.9) should be developed. This map will define the different tiers of stakeholders according to their potential to affect the reputation or the progress of the project or organisation, with the programme at the centre.
Figure 1.9 Stakeholder map – illustrative example.
1.9 Portfolio management
In the eventuality that there are a number of projects and programmes running in parallel within an organisation, the organisation will often utilise a portfolio approach to govern and administer the initiatives, projects and programmes to identify and manage priorities.
The portfolio management approach will aim to understand the current strategic intent of the organisation and will determine the optimum spectrum of programmes and projects that would provide the most effective and efficient way of achieving the strategic vision by balancing the resources, risk and benefits sought.
Typically, in any organisation portfolio management is an ongoing activity, for unlike most programmes and all projects, it will not have a defined end date.
The administration, management and governance of portfolios follow principles similar to a programme; however, unlike programmes, the procedures are open ended and subject to continual reviews at the highest level of the organisation.
Large organisations may have multiple portfolios, in which case an additional layer of management and governance will be necessary between the senior decision-makers and the portfolio management levels for reporting and administration purposes.
Figure 1.10 illustrates an example of a portfolio management structure in the context of project and programme management.
Figure 1.10 Portfolio management structure.