Here at ITM Platform we often hear PMO professionals say, “our maturity level is too low for PPM” or “we are not ready yet for project management”. In this article, we delve and explore into what project management maturity actually means and how a PPM solution is a bridge and not a roadblock to increasing your maturity level.

Truth is project portfolio management is not just for big corporations or businesses with complex processes.

Regardless of the size or maturity of your operation, it is possible to implement simple and effective project portfolio management. Different maturity levels require different features.

 

 

 

What is “Project Portfolio Management Maturity” anyway?

Project Portfolio Management Maturity refers to how ready your company is to smoothly execute a project, program and portfolio management strategy.

This can be assessed on a wide spectrum, ranging from an individual assessment to applying a formal maturity model assessment.

 

Identifying your company’s maturity level, yourself

In most cases, companies identify their own maturity levels on their own without any formal assessment. If you´ve ever caught yourself saying, ¨my company isn´t at that maturity level yet¨ then perhaps your own expertise and experience at work has led you to this conclusion. Have you ever had this conversation at the office?

  • - Hey, how do you keep track of projects here?
  • - We ask the project manager.
  • - I see. And do they use any formal or standardized way to do it?
  • - Well, so and so do, but not really.
  • - Then, how do you know how your portfolio is performing?
  • - Eh, we just focus on the projects that are causing problems now.

… Say no more. You´ve already pictured your company as having a low maturity level and reckon a PPM software solution will do nothing more than create confusion and frustration. However, it doesn´t have to be so challenging. Even if you found that the maturity level is low, you can still help your company grow in maturity with the right set of functionalities when applied at the right time.

 

Applying a maturity model assessment

A maturity model assessment is a specific set of criteria defined for each level and categorizes companies to their respective project portfolio management´s maturity levels.

Some models have six levels, others have four or five. But what’s most interesting are the category axes or dimensions that are used for classification. These are the most relevant, explained with basic examples:

 

  • Processes: Consider this the train tracks over which work flows. In our hypothetical conversation above, the fictional you asked about the processes in place. Other examples can be whether the company has formal resource management, risk management, cost management, program management or strategic alignment processes.
    You get the idea. If you’re a PMI fan, you already know them all.
  • People: Maturity models tend to put people first and assess questions like: does the staff understand and embrace project management? Do they know the processes of which they are involved in? Are they use to working on a project-oriented organization rather than a functional organization?
    People are vital to any organization and it`s important to consider human resistance when assessing the maturity model of your organization.
  • Organization: This is where processes and people come together. Some questions about the organizational model usually are: Does your company have a solid PMO (or a PMO at all)? Is Human Resources integrated in the portfolio management? Is top-level management on it? Is it a project-based organization?

 

 

Depending on the model, you will commonly come across these axes plus others such as technology or competitive landscape.

The takeaway here is that there are models out there that can help you objectively measure what you already suspected.

You can also use this online PMO & Organization Self-Assessment that measures three categories: Organization, Talent and Conditions  and in return,  providing a set of recommendations based on the results.

Our own findings

Most companies we´ve talked to find themselves somewhere in the medium-low / medium range spectrum. They tend to assess their company as having a lower maturity level than they actually have.

This happens in all countries we operate in even though there are clear market maturity differences among them. In most cases, this is because companies measure themselves against their own market/countries and not globally.

Furthermore, dealing with leaders across the world, we´ve noticed there is no strong correlation between the company size and its maturity. The general assumption seems to be that big companies are more likely to have a solid PPM methodology in place. However, it’s more related to the nature of the business rather than the size. The more project-oriented the business is, the more mature those organizations tend to be.

 

How is all this relevant to the decision of implementing a PPM software?

Project portfolio management solutions should be flexible and scalable enough to start small, grow gradually and add processes over time. This will allow you to create a consistent and sustainable project portfolio management ecosystem sans big initial investments and blows to your company.

Logical reasoning would presume: “if my company has a low PPM maturity level, first I need to increase it and then implement the tool”. This obviously happens to those who are aware that there is such a thing as PPM maturity. This persona is usually someone who has either used or has knowledge of complex PPM systems in the past.

And it’s true, six to twelve-month implementations and significant amounts of money are enough to set off any initiative, especially if the organization is not ready. Many would wisely argue that spending more on tools than the ROI they have on their projects is a poor move.

Processes and tools go hand in hand. Implementing one without the other is not ideal, since the tool enables the process and the process is transmitted through the tool. You just need to find the tool that can grow with you and adapt itself on that journey.

Pro tip: Changing from Excel and email to MS Project, then to a collaborative project management solution and finally to a PPM solution is not really growing. It’s breaking and recomposing processes, people and organization at every step of the way.

 

How ITM Platform supports every level of maturity?

The key is to identify the PPM solution that can provide the features according to your needs. Sound simple? The reality is that optimizing your company´s maturity levels need to take multiple factors into account and is anything but simple. And, like anything else that´s really complicated, most of us are looking for better tools to achieve tasks. Companies need a solution that in tandem adapts to your maturity level and enables you to add or remove features according to your needs.

ITM Platform gently increases maturities with the least possible hassle. It is equipped with easily adaptable features that grow with you no matter the stage. It’s comprehensive, intuitive and its seamlessly easy learning curve is just what you need to get your PMO up and running.

It´s possible to start on the right foot even though you know there’s a low project portfolio management maturity level in your company. And turns out, this is an excellent starting point!

Take the first step and try this free trial now! Experience first-hand what ITM Platform can do for you.

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unicorn on black backgroundToo much innovation can be bad

Innovation is dangerous. Despite the many benefits of marketing new products and services, it is important for any private organization not to underestimate the complications of practicing innovation on a day to day basis. In short, for a private organization with limited resources, too much innovation without sufficient control, can quickly lead to disaster.

Start managing your innovative projects in a unified portfolio with ITM Platform 

Innovative ideas are, by definition, very risky. When you launch an innovative project, the future, the success and acceptance in the market, and often the technical difficulties for its development are unknown.

Solution: portfolio management of innovative projects

Over time, some innovative projects will fail, while others will succeed, they will come to market and may even become established.

This means that, in order to achieve successful innovation, it is imperative to fail, close defective projects, expose oneself to risk and, ultimately, lose financial resources that will not produce results.

So that the risk of innovation does not overwhelm your organization, it is essential to treat innovative projects as a portfolio that is managed according to unified criteria. Therefore the team that manages the portfolio has the important task of monitoring the organization's innovative projects.

Responsibilities include the following:

  • Demand a clear business argument about the commercial feasibility of the development and its relationship with the needs of customers.
  • When there are no spontaneous candidates for innovation, it is essential to request new proposals in the strategic directions and areas that have been identified.
  • Establish evaluation criteria for proposals.
  • Evaluate the proposals, discarding those that are too risky or do not promise sufficient benefits.
  • Decide investment limits for innovative projects, as well as total risk capacity.
  • Compose a balanced portfolio.
  • Coordinate the management of projects that make up the portfolio, especially in the case of shared resources.

How to monitor a portfolio of innovative projects?

When composing the portfolio and with a view of monitoring innovation, it is important to:

  • Have an appropriate balance between different types of projects, such as small technical innovations that improve an existing product or totally new products and services; and types and levels of risk.
  • In addition, it is essential that innovative projects are not linked to each other and can fail or continue independently. Otherwise, if projects share risks and have dependencies, failure in a component could have an impact on the whole portfolio. The fundamental idea of ​​a balanced portfolio is diversification and experimentation: that each project has its own life.
  • Achieve a number of projects low enough to be feasible with available resources (which will often be shared) and high enough to allow the introduction of new products and an interesting flow of projects for the portfolio's half-yearly and annual evaluations.

Evaluation of innovative projects

As we indicated above, in order to evaluate innovative projects and decide whether to keep them in the organization’s portfolio, it is important to define a series of benchmarks. Although it will depend on the sector and the characteristics of each entity, some typical criteria are:

  • Estimated cost
  • Development time
  • Critical resource consumption
  • Alignment with the strategic factors of the organization
  • Innovative and differential character
  • Technical success probabilities
  • Commercial success probabilities
  • Ease of imitation by competitors

Once the criteria are selected, it is important that they be assigned a weighting that allows final estimates to be made. The relative weight of each factor is usually a measure of the organization's situation. For example, in consulting firms that rely on networks of collaborators, the consumption of critical resources will be of little importance, whereas the limitation of development time may have more weight than in other more stable organizations, where innovative projects can be developed with stability over the years.

The score is a good estimate of the value of the project. However, the viability of an innovative portfolio depends on special attention to the composition of its risks. Therefore, beyond that final score reached by the projects based on the selected criteria, it is recommended that the composition of the portfolio of innovative projects make use of an assessment matrix.

The assessment matrix of innovative projects

Many of our readers are already familiar with the ITM Platform risk assessment matrix. The evaluation of innovative projects allows a completely analogous technique to be used.

In the assessment matrix of innovative projects two variables appear:

  • Expected commercial return of the project
  • Risk level

returns/risk

Ideally, all projects will be placed in the upper left quadrant of the matrix, they may be scarce and there may be many projects in the balanced quadrants marked in blue (where returns are proportional to risks).

Bearing in mind that it is good practice to include projects of different types with different levels of risk and knowing that, no matter what we do, some of the innovations will not be successful, a good result is the allocation of the project budget with Percentages that follow a proportion like that of the illustration.

percentages in rectangles

From the location of innovative projects in the matrix and their combination with the punctuation according to the criteria listed above, it should be much easier to make the final decision about which proposals to accept and which to discard.

Innovation will remain risky; but well-organized monitoring will increase the organization's chances of success and learning, with the potential to turn unsuccessful projects into better, more ambitious proposals in line with the pulse of the market.

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Qualitative and quantitative risk analysis are two very different processes. In this article we explain qualitative evaluation with an example taken from the video game industry.

In general, qualitative analysis seeks to identify risks by using scales that summarize visually and intuitively the relative dimensions of each risk, allowing to prioritize: providing a visual representation that combines the most basic factors, such as the impact that the risk would have on a project and the likelihood of it occurring.

In spite of its name, qualitative evaluation implies a numerical estimate of these two variables along previously defined scales using a quick and subjective approach. It's something like when doctors ask: From one to ten, how much does it hurt?wong-baker faces pain rating scale

Similarly to the intuitive scale of Wong-Baker's expressions, qualitative assessments of risk have visual translations in a geometric representation that allows a systematic comparison in risk assessment matrices.

In the example that follows, we have used our online risk assessment matrix to estimate the comparative weight of the following risks for a team of developers in a video game studio:

  • Inadequate graphics engine

  • Loss of programmers

  • Failure in approval process of the game build after submission

If we assign impact and probability values to these risks, we obtain the following table.

Risk

Probability

Impact

Graphics engine

20% 40

Personnel

33% 50

Certification

8% 100

The table itself suggests some observations.

  1. Experience, the mother of probability

Firstly, in a video game studio that launches, say, half a dozen titles a year, after 10 years of activity there is a portfolio of 60 titles that allows to draw certain conclusions about the frequency with which these risks occur. The probability estimate is based on the experience of the organization, which has suffered personnel losses in the programming area in one out of three projects.

  1. Simplify and then discuss the details

This model simplifies factors in just two values, but it is important not to lose sight of the fact that the variables hide more complex realities that should appear in the quantitative phases and in the discussions with the stakeholders. For example, loss of talent can hide many different realities, depending on the number of people lost, their roles within the organization, or whether the loss is due to a transfer to another company, vacation, retirement or inability to hire according to the forecasts of the HR department.

With all these nuances, when we load the table into ITM Platform’s online risk assessment matrix we obtain this result:

Risk matrix videogame sector example

Although there is no single interpretation for this type of result, the visualization emphasizes that the most threatening risk for this study is the loss of personnel, while the selection of the graphics engine and certification seem to be more controlled by the workflow and process procedure. The HR department of the studio will probably need a mitigation plan in order to be able to face situations of personnel shortage in times of high load of work. Such a plan could include:

  • Reassignment of tasks to existing resources.

  • Segmenting possible delays, or cost increases in case the scope is maintained.

  • Communication plan to stakeholders involved in the tasks who may suffer because of the delays.

  • In severe cases, reconsideration of non-critical components that allow the viability of the product to be saved.

Remember that you can compose your own set of risks in ITM Platform’s online Risk Assessment Matrix. In addition, if you can register, save and share them with your team.

In the next article of this series, I will expand the example to the context of a quantitative evaluation to better understand the differences between the two approaches.

 

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