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Portfolio indicators or Key Performance Indicators are paramount in having a global view of the organization and its project performance. In this article, we review the most important ones.

KPI 1: Internal demand in number of days / workers

When your organization manages internal projects, whether it be change projects or new product development, the client and the project sponsor will from within the company. That is why, when poorly managed, internal project portfolios can become crazy races, causing disputes between the various promoters as they try to get ahead of each other in order to increment the team staff, acquire additional funding or the favour of the board of directors.

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Therefore, it is very important to be clear, at all times, about what the total internal demand of each area of the organization is generating for its different projects. It is true that you can rely on what is the largest project or what are the criteria to incur costs, but while the first is a partial indicator, the second does not allow you to see the development of the planned workload. The internal client demand indicator is the perfect KPI for this purpose. Thanks to this, you will know how many days of work each department or functional area of your company generates in the project teams. This information is not only valuable for the CIO and the CEO, but can also help you establish a maximum demand limit for days worked related to the organization (throughout time).

Of course, if there are transversal projects that involve several departments, it is essential to have a good system of project allocation, so that the information contained in the system is not distorted and the indicator is actually useful.

KPI 2: Employees by professional profile

If your organization relies on consultants for your projects, it is very possible that the available skills vary greatly over time. Today you could have four experts in programming JavaScript and none in four months. Hence, it is important to be clear at all times what the composition of your human resources by professional profiles are. The evolution of this indicator will facilitate the work of your PMO, the planning of resources as well as the identification of gaps or oversupply. In addition, graphics are very useful for the management team, as they easily communicate the structure of the personnel involved in projects.

KPI 3: Estimating effort

The previous indicator would do little to manage the portfolio if we could not anticipate the future needs of certain profiles. For this, it is essential to have a view of the estimated efforts in the coming months. Each project manager takes into account where the greatest effort is concentrated in for the projects for which he is responsible for, but very few have the necessary information to know if the "hot seasons" of each project coincide. From such a chart, portfolio managers would know when there is a greater risk of scarcity of certain skills and can plan accordingly. In the given example, the busiest months are June, September, July and April, respectively.

KPI 4: Budget by objectives

Within the economic indicators, one of the most interesting from the point of view of the portfolio is the one that indicates the aggregate investment that is being allocated to each one of the objectives of the organization. This indicator should serve as confirmation that the management of the project portfolio is following the strategic guidelines established by the highest management bodies. If a goal has the highest priority, it is logical that it is receiving the highest share of investment. Any contrary discrepancy must have sufficiently justified grounds. In the given example, if sales growth were more important to managers than increased operational efficiency, the portfolio should be revised to ensure that total investments in these areas correspond to the priorities. It is possible that the operational improvement currently has a very expensive project of change but of limited duration, after which completion the percentages would be re-adjusted.

KPI 5: Process budgeting

What business processes are absorbing more investment? In conjunction with the domestic demand indicator, this indicator leads to optimization, cost reduction and the elimination of redundancies and inefficiencies. Processes that are considered marginal and low value-added often consume resources for administrative and maintenance reasons that are difficult to reduce. However, it is crucial to know what the natural or average value of this indicator is and to ensure that it never rises above it. In the given image, assume that the average cost of storage for 'GlobalCorp360' is at 8%. If at any time it rises above 12% for no apparent reasons, this becomes alarming and yields more than enough evidence to submit the process to an audit.

KPI 6 and 7: Budget by component and current cost per component

The simplest indicator, which shows the budgets for each of the projects involved, remains the most useful for the portfolio manager. As with the calendar for an event manager, the director of a portfolio should always have before him a written reference of the budget of each project. The person responsible for a portfolio must demand the highest precision of the budgets and the costs incurred by each project. For the same reason, it is essential to have a solution that, like ITM Platform, updates the information immediately each time a new invoice is registered, without having to wait for periodic reports.

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Traditional change management systems are based on a transition from an old model to a new one.

These change systems could be seen as a journey, in which one begins at the origin and directs the steps towards a destination, considering that success has been achieved when the objectives established in a given time have been achieved.

However, is this model the right one?

In this present, ever changing world, setting a fixed destination is probably not the best idea. What would probably be more appropriate for the current market, the socio-economic context and our clients, will not be the same in a few months.

Given this, the established destination for our journey, the objective of change, will no longer be our preference once we achieve it.

Therefore, it will be necessary to establish another destination and to chart a new course, initiating a new cycle that is on course to repeat itself.

This concept of change is probably due to its traditional relationship with project management. After all, this has been based precisely on that: in establishing a project to achieve, to chart a course, to define work methodologies and to fulfil them.

However, in today's world, this isn’t enough. A change management system must be able to anticipate the environment, change course to a new destination and adapt to the needs of the company.

Therefore, another way of understanding change management is as a system that, instead of directing change in one direction, seeks to establish structures or systems that allow a paradigm shift in the company. The objective of the change is to make structures more flexible, to improve adaptation mechanisms and, in short, to facilitate the establishment of all future changes without altering the workflows and productivity already instilled, to be able to adapt to market needs.

In this new paradigm, the classic concept of work methodology disappears, since it does not exist as a stable concept, but a dynamic and changing methodology instead.

Essentially moving from a system of sequential change to a system of permanent mobilization.

Ingredients for a mobilized system

Mobilization systems, despite being characterized as having no fixed methodologies, consist of a series of structures necessary to ensure that an efficient change is produced permanently.

The following are components that must be found in any business structure to constitute a mobilization system:

An ecosystem prepared for change. These environments must have some sort of performance algorithms that allow the adoption certain attitudes when in an environment with previously established order. When the market presents a certain change, the reaction must be one that adapts to the necessities imposed by the new market circumstances. In the same way, action protocols can be drawn up that allow modification of attitudes according to the circumstances.
Informal systems within the company. Although the company must have clearly established and formal channels of communication and hierarchy, there must also be other informal, agile systems within the company. This way, communication and change will be more dynamic and agile, and will allow a quick reaction to a change in the circumstances of the company.
Establishing a culture based on change. Change must be understood as a way of working, a way of conducting within the company. "Today more than yesterday but less than tomorrow" and a principle of constant improvement, must be printed on the company's DNA.

Conclusion

Change has come to stay. And it affects not only the working methodologies of companies, but also the change system itself.

The "Change in change", on a constant basis, ensures real-time adaptation to market circumstances and customer needs.

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The Pentagon is not only the symbol of the most powerful military power in the world, but the supreme governing body of the American military: the public organization that has contributed the most to the consolidation of project management as a discipline. The technological development experienced by the arms industry and the expansion of logistics operations supported the development of numerous methodologies and an abundant class of engineers.

For example, the Work Structure Decomposition (DEBS) method was designed by the Department of Defense and was first deployed to the United States Navy in 1957 within a ballistic program. In addition, one of the most common careers for military members and retired veterans is precisely to direct projects. Military matters assume the highest demands on timely delivery and quality of results.

On the other hand, the fact that the Pentagon has access to huge budgets for other states carries a very important risk of wastage.

You cannot live in glory: in complex environments with multiple projects and where it is practically impossible to always have an overview of all the work, it is very easy to produce problems of inefficiency. This explains why project monitoring is a fundamental mission in the management of any portfolio.

X-ray of the Pentagon

In January of 2015, an internal report of the Department of Defense revealed a chilling fact: in the next 5 years a total of 125 trillion dollars could be saved, which would be enough to appropriate adjustments in the administrative and bureaucratic departments.

Approximately a quarter of the Pentagon's budget is spent on administration, management and maintenance costs, and cannot be used for the mission of the agency.

So, what are all these resources destined for? In large part, the maintenance of a complex structure of management processes in which a total of one million people are employed, a number forty times greater than the employees of the pentagon itself and practically identical to the ones that are in operations Military. The six major administrative processes are Human Resources, Health Management, Financial Management, Logistics, Procurement and Suppliers, and Real Estate Management.

In the image below you can see an example of the intricate bureaucratic web in which all these back-office workers are involved in one way or another. The title of the image is: Integrated Department of Defense system for the acquisition, development of technology and Supply logistics.

That said, the image shows the complex process by which it is decided to contract (or not) a particular service, to develop (or not) an investigation, to manufacture (or not) a weapon or other device, to move it (or not) to the front and keep (or not) weapons, vehicles or any other type of technology.

The inefficiency of this process is proverbial, as in the case of the development of the Bradley vehicle in the 80s, whose total development cost 15 billion dollars.

The solution: efficient management

Other documentation for internal use indicates some of the measures that can be taken to improve the management of these projects, making it much more efficient in the administration of all financial resources. By way of illustration, in 5 years, according to their calculations, 4,325 more soldiers could be hired.

Among the most interesting solutions for other organizations are the following:

Establishment of transversal teams for each process that can create common rules and methodologies for all
Prioritization of contracts
Review of contracts to exclude and discount all items that do not correspond to real requirements
Training of cross-cutting teams to improve productivity
Development of internal initiatives in priority processes and activities

Interestingly, pentagon solutions go through the creation of a portfolio of internal optimization and operational innovation projects that would be overseen and supported by program managers.

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Project managers and PMO officers muster a highly technical skill set. However, the soft skills in which they need to be well-versed in order to be recognized as leaders have become one of the toughest areas of excellence for any project-based organization.

The problem has become even more urgent with the digitalization of intellectual work: workers and experts can now be brought into a project remotely across countries, languages and a myriad of different cultural elements. How to turn delocalized networks of diverse people into robust teams is one of the standing challenges for a modern project leader.

The stepping stone into project leadership is to find support in the use of technological systems designed to support and enhance intensive collaboration, like ITM Platform’s PPM software.

But besides that, if they want to succeed project leaders will have to recognize that external consultants and remote teams have different support needs than the traditional, internal team members.

Invite all your collaborators to ITM Platform and power your projects with a PPM tool with in-built social communication.

Is project leadership the same as traditional business leadership?

“Project members may feel the disorientation that comes with the lack of a stable home”

According to an already classic research paper, “Transformational leadership in a project-based environment: a comparative study of the leadership styles of project managers and line managers”, the project leader can have the same authority and recognition as the leader in a functional organization; however, the nature of project-based work sets barriers for transformational outcomes.

In fact, many project members unbound to a department feel the nausea or disorientation that is related to the lack of a stable home: a permanent work station; a group of colleagues to relate to and build confidence with over time; or even a geographic location and a predictable daily routine. In absence of all these coordinates of professional stability, leaders will find that it is harder to motivate employees, oversee their careers, and make them understand their place and importance in the overall scheme of things.

Similarly, all modern organizations suffer under the inescapable dooms and benefits of technological innovation: nowadays, a team member can be recruited for a short-term engagement from a different country on the other end of the world. Usually, these relationships are based on the demand for readily available and highly qualified talent, which can literally be found anywhere thanks to the existing collaboration hubs. While this trend was barely emerging in the early 2000’s, it has consolidated as a clear business model with a myriad of online platforms, such as freelancer or 99designs for designers, twago or Upwork for web and software development, or even NineSights or kaggle for innovation and big data contests.

While hiring talent from across the globe is easier than ever, this frictionless environment shifts a strenuous pressure into the coordination needs with newcomers. And, paradoxically, at the same time it's becoming increasingly difficult to retain talent and meet the professional expectations of millenials in terms of flexibility, work-life balance and career development. This guide on working with technology that is suited to millennial culture can help your company overcome this challenge.

Obviously, this pressure then translates into new styles of leadership; and it does it at a time in which often support systems for traditional, site-based project teams are still precarious.

In this context, it’s obvious that team management requirements have changed enormously, shifting away from the face to face authority of the office leader to the need to clearly communicate and align expectations to that kind of loosely coordinated network in which team members come and go.

Most often team members will fulfil specialized tasks, but entire projects with important co-dependencies can also be outsourced. In the latter case, that is when projects are tightly packaged before they are outsourced, the external player will have it easy: he or she shall only need to understand project scope, deadlines and budget.

However, outsourcing tasks within projects and externalizing a part of the project team is a much harder practice in the day-to-day of project leaders. If we go back to the initial metaphor, the leader will somehow have to reconstruct a home (or a temporary albeit comfortable shelter) for the external member so their engagement with the project is guaranteed.

1. On-boarding = constructing a home with corporate values

“Combining the collaborative power of Slack with the PPM capabilities of ITM Platform is a great way of keeping all project members on the same page, multiplying team interactions and ensuring that project planning and execution are strictly aligned”

While many full-time freelancers are likely to feel comfortable in loosely coupled teams with brief touching points and interactions, making sure any new node in the network knows how to proceed is a strong organizational priority.

The home cannot be forced upon the external member: whoever prefers a detached, professional collaboration with no soft commitment will eventually have her way; but on the corporate side it should be all about a seductive approach to persuasion that is very strongly related to corporate culture and values, to a strong branding and to the on-boarding. Depending on how this process work, employees and consultants can either feel important contributors to the organizations or a redundant appendix.

Under this light, seemingly secondary pieces of communication have an enormous importance. How you welcome members into the team, make requests for feedback or encourage spontaneous interactions become central elements to the leadership activity. It’s important to stimulate autonomous work while ensuring that there is a record of all vital progress.

For that reason, the integration of collaboration tools and project management technology is particularly relevant in the project leader portfolio. To support that need, we recently designed ITM Platform Teambot, an app for Slack that allows our user base to recall their current projects and tasks, report hours and progress and send contextual comments into the platform without ever leaving Slack’s IRC-type chat interface.

Combining the collaborative power of Slack with the PPM capabilities of ITM Platform is a great way of keeping all project members on the same page, multiplying team interactions and ensuring that project planning and execution are strictly aligned.

2. Self-management and discipline

“Sustained clarity into the processes, expectations and requirements are of particular importance for remote workers and external consultants.”

Much more than regular employees, who can embed their practices into the dynamics of the organization and rely on daily interactions to regulate inter-dependencies, remote workers and consultants need to self-manage their time and be very disciplined. However, this doesn’t mean they don’t need to follow external leadership: on the contrary, even the most disciplined professionals will be extremely frustrated in the absence of proper project leadership that doesn’t communicate a clear focus.

Although it obviously benefits from the magnetism of charismatic authority, project leadership doesn’t have to be very personal. Sustained clarity into the processes, expectations and requirements are of particular importance for remote workers and external consultants.

3. Strong processes embedded in top-value technology

“The technological backbone is a fundamental pillar of project management processes. Your ITM Platform environment will be the organizational home to your project activities”

Project management instruments, methodologies and templates are the core of a strong policy of validated processes that work throughout the entire organization. A fundamental pillar of those processes is the technological backbone that keeps track of the everyday progresses.

In project management contexts with remote team members, it’s vital to have a tool that covers that backbone and connects communicational needs with planning and execution:

Financial management: keeping track of all the costs incurred by the resources allocated to a given project
Time tracking: Control whether team members, particularly new ones, are as productive as planned, identify deviations and bottlenecks and assess their cause
Planning: Plan projects in the same environment your team members use to report their efforts. Your ITM Platform environment will be the organizational home to your project activities.
Communication: Direct messages between members, contextual messages related to any given task or project. The objective is to empower teams for conversations that are permanently relevant because they stored where the work actually happens.

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ITM Platform is specifically designed to support multi-project organizations: our client base ranges from small consultants to large corporations, such as Grupo Lala, the first manufacturer of dairy products in Mexico, or Spire Healthcare, the second largest private healthcare provider in the United Kingdom.

Why do they choose us? They say that among all the tools that allow both planning and executing projects and managing portfolios, it is not easy to find solutions that are useful for both project managers and PMO directors at the same time in the same environment.

So when someone asks us if we can help them get their Project Management Office up and running, the answer comes as natural as the smile you give an old friend. In this article we discuss the main reasons why ITM Platform is a great ally to support the activities of a PMO.

1. Capture your organization

Any organization can reflect the structure of their teams in a very short time. Whether it's a functional organizational structure based on departments, a purely project-based structure, or a matrix-type intermediate structure, the first step for your organization to start managing your ITM Platform projects is to map which department, project or area of competence belongs to each member.

In fact, flexibility is achieved by combining two criteria:

Organizational units, comparable to traditional departments
Working groups, which allow cross-grouping. For example, you can create project teams that have a certain permanence character. These groups can also be used to bring experts together by competencies so that project and PMO managers can easily assign them to specialized tasks and groups.

Once you have reflected the departments and functional units, you can continue defining the details that will allow ITM Platform to control the costs and progress of your projects in real time:

Hourly rates: How much do your team members charge per hour? How much do external consultants charge? What is the overhead of a workgroup compared to a technician? By specifying the fees for each type of expert, ITM Platform allows you to reflect the actual costs of your projects with the desired level of detail.

2. Capture your processes

ITM Platform allows you to capture any methodology you are using in your organization for project management. Although the software is intended to capture the components, processes and groups recommended in standards such as PMBOK or Prince2, especially when it comes to project integration management, it is not necessary to strictly follow these manuals to properly manage the projects. The focus of the tool is to provide a flexible technological service that allows the capture of all relevant information and capture the process flows that exist in each organization.

3. Connect to your teams

ITM Platform empowers all project teams, from the highest level director to the young talented new arrivals.

Management: Those who are interested in seeing key metrics such as the degree of progress of the projects by each program, the level of risk exposure of the projects, or the composition of costs per manpower according to the provider can use the customizable scorecards and reports.
PMO portfolio managers, program managers and PMO directors

The people that connect the company's strategy to day-to-day project management are those that most directly benefit from the ITM Platform. Let us see some different aspects:

Shared resources

In situations with cross-cutting projects shared by experts and analysts from different functional areas or departments, it is common practice for one of the PMO director's main attributions to be to avoid conflicts when using shared resources: professionals in high demand due to them being very qualified and are irreplaceable in their specialty. Conflicts for shared resources are the cause of delay in 42% of large cross-sectional projects.To avoid such conflicts, ITM Platform allows you to immediately identify over-allocation of all resources in the organization.

Scenario projections

The ITM Platform methodological tools for defining business objectives and linking them to project execution scenarios are one of the aspects most valued by those who manage project programs.

Portfolio Evaluation

Aggregated project data allows you to carry out a continuous evaluation of your portfolio with the required periodicity. From the moment that your entire project team is using the same tool to plan and execute projects to carry out portfolio tracking, you can say goodbye to tedious periodic portfolio evaluations that stretch over months. It will be sufficient to extract data from ITM Platform to discuss with your team.

Project Managers

The possibility of combining predictive projects with agile methodologies allows different relationships to coexist between customers the development of products and results within a single unified portfolio based on shared financial management and resources.To top it off, project managers benefit from a user experience optimized for the integration of projects from menus that are always visible and easy to navigate.

Analysts and team members

Team members with no planning and control responsibilities should only enter the progress data of their tasks on the ITM Platform. For this, they have different auxiliary interfaces that save time and increase their productivity:

Mobile App on Android and MacOS. Report the time worked on a task. It is a fundamental support tool for those who are out and about or working remotely.
The ITM Platform teambot. The integration of ITM Platform with Slack is designed to aid personal productivity, as it allows each team member to track the tasks in which they are involved and report progress with simple commands such as “/itmplatform list tasks”
In addition, software development teams working with JIRA for issue management can connect these with their ITM Platform projects to manage their portfolio from their preferred environment.

4. Align project management and portfolio planning

Project management software can be divided into three broad sections: task managers and teams; project planners; and portfolio managers. Few tools can find the balance between these three areas. This is where ITM Platform stands out precisely because our obsession is to optimize the return of the projects from the first minute, with little to no barriers of entry.