Project, program, and portfolio management

Project, program, and portfolio management are closely related but distinct approaches to managing work within an organization. They differ in scope, objectives, and the level of control exerted. Here’s a breakdown:

1. Project Management

• Definition: A project is a temporary endeavor undertaken to create a unique product, service, or result. Project management is the application of knowledge, skills, tools, and techniques to project activities to meet the project requirements.
• Characteristics:
  • Has a defined beginning and end.
  • Has specific objectives and deliverables.
  • Has a budget and schedule.
  • Involves a team of people.
• Focus: Delivering a specific output within defined constraints (time, cost, scope).
• Example: Constructing a building, developing a software application, organizing a marketing campaign.

2. Program Management

• Definition: A program is a group of related projects managed in a coordinated way to obtain benefits not available from managing them individually. Program management is the coordinated management of multiple related projects to achieve strategic benefits.
• Characteristics:
  • Composed of multiple interdependent projects.
  • Focuses on achieving strategic benefits and outcomes.
  • Has a longer duration than individual projects.
  • Involves managing interdependencies and resolving conflicts between projects.
• Focus: Achieving strategic benefits by coordinating related projects.
• Example: Implementing a new customer relationship management (CRM) system (which might involve projects for software development, data migration, and user training).

3. Portfolio Management

• Definition: A portfolio is a collection of projects, programs, subsidiary portfolios, and operations managed as a group to achieve strategic objectives. Portfolio management is the centralized management of one or more portfolios to achieve strategic objectives.
• Characteristics:
  • Includes a diverse set of projects and programs.
  • Focuses on maximizing the overall value of the portfolio and aligning it with strategic goals.
  • Involves prioritizing and selecting projects and programs based on strategic fit and resource availability.
  • Deals with optimizing investments across the organization.
• Focus: Aligning investments (projects and programs) with organizational strategy and maximizing overall value.
• Example: An organization’s investment in research and development, which might include programs for developing new products, improving existing products, and exploring new technologies.

Key Differences Summarized

Feature	Project Management	Program Management	Portfolio Management
Scope	Single, defined project	Group of related projects	Collection of projects, programs, and other work
Objective	Deliver specific project output	Achieve strategic benefits through coordinated projects	Achieve strategic objectives through investment optimization
Focus	Project deliverables, time, cost, scope	Interdependencies, benefits realization	Strategic alignment, resource allocation, risk management
Timescale	Shorter term	Longer term	Long term
Manager	Project Manager	Program Manager	Portfolio Manager

Relationship between Project, Program, and Portfolio Management:

These three levels of management operate in a hierarchical manner. Projects are components of programs, and programs (along with individual projects and other work) make up a portfolio.

• Projects contribute to programs: Individual project outputs contribute to the overall benefits sought by the program.
• Programs contribute to the portfolio: Program outcomes contribute to the achievement of strategic objectives defined at the portfolio level.
• The portfolio aligns with organizational strategy: The portfolio ensures that all investments support the overall direction and goals of the organization.

Understanding the differences and interrelationships between project, program, and portfolio management is crucial for organizations to effectively manage their work and achieve their strategic goals.