Project-Portfolio Management 101

Updated: April 30, 2009

Keeping tabs on IT projects can be a time-consuming and complicated endeavor. After all, with duties that range from increasing storage capacity to rolling out a new HR application, IT managers are often hard-pressed to know which workers and how many resources are being dedicated to a particular project at any given time.

"Most IT departments handle the management of work in a haphazard way. That's because the tools that they use to manage and track these projects aren't really designed to support the management of work," said Dan Stang, a research analyst with Gartner Inc.. Even worse, a recent Gartner survey reported that most IT departments spend 70 percent of their annual budgets on projects that have no direct business impact. "And that's probably the best-case scenario," lamented Stang.

Enter PPM (Project Portfolio Management) technology. PPM solutions measure a company's available resources — such as time, manpower and money — against proposed projects and align them with business objectives. The result is an automated system that can perform feats spanning from anticipating labor shortages to planning operations expansions to gauging the effect of new systems to evaluating how an IT project adds value to a company.

A New Focus

Although PPM technology has been available for some time, the landscape is rapidly changing. Several years ago, PPM solutions were primarily used to help companies juggle a wide range of projects. In today's tough economy , however, the technology focuses on enabling IT departments to scale back operations.

"You need visibility [into your project pipeline] even more now, especially during an economic downturn when you want to make sure that you're making investments wisely," said Stang. ""If you don't know what you're spending time and money on, then how do you know you're spending it on the right projects?"

In addition, by accounting for the ways in which ""an IT department accepts, manages and executes on work," said Stang, PPM technology can also help alter an IT department's reputation as a corporate money pit. After all, stated Stang, "IT departments are viewed as a cost center , but they're not just a black hole that you dump money into. IT is absolutely a strategic component."

On-Demand Visibility

An economic slowdown isn't the only factor that's changing the way that companies use PPM technology. Many vendors now offer on-demand versions of PPM solutions, which allow companies to sample the technology before deploying it on an enterprisewide scale. Other benefits of the on-demand approach to PPM include faster implementations, lower costs, no need for infrastructure investments and a quicker return on investment.

"The market has matured to a point where it's opened up more business opportunities for vendors that want to provide a more cost-effective solution using alternate deployment methods, and that's where the SaaS [software as a service] players have found a place for themselves," said Stang.

The Players

Here are just a few vendors that provide on-demand PPM solutions, as well as brief information on what they have to offer:

Daptiv PPM: This solution allows users to select, staff and manage projects across teams, departments and divisions. Employees and team leaders effectively collaborate on day-to-day tasks via a Web interface, while business managers and executives gain visibility into project, program and portfolio execution.

Innotas: Innotas prioritizes the portfolio of IT projects and applications according to business objectives; responds to changing conditions by rapidly reallocating resources with a full understanding of the impact; and identifies what employees are working on and makes clear business decisions on establishing priorities and how resources are used.

CA Clarity IT Portfolio Manager: This solution extends beyond basics — such as time tracking and project and resource management — for rich collaboration, knowledge management and best-practice methodologies for cross-functional work teams across the extended enterprise. Resource-planning capabilities also provide the forward-looking view that senior managers need to achieve optimal resource usage.

Featured Research
  • Best ERP Features and Benefits for Your Business

    Are you considering investing in ERP software for the first time? Or maybe you already have an ERP solution but you’re worried it’s becoming dated. If either of the above apply to you, read our latest guide on the top ERP features and benefits based on the size of your business. You may be surprised at how versatile and cost-effective it is becoming - regardless of if you own a small business or run a large enterprise. more

  • 8 Ways the Cloud is Changing ERP for the Better

    What if there was a tool available that allowed for you to save up to a quarter of your operational costs? Studies have shown that Enterprise Resource Planning (ERP) solutions enable businesses to access accurate, real-time information about daily operations which allow for the reduction of operational costs of up to 23% and administrative costs of up to 22%. more

  • 7 key questions to ask any ERP provider

    Having a fast-growing business is good. Having to overhaul your technology every time you need to scale is not. Upgrading to a more complete Enterprise Resource Planning (ERP) solution can help, but how do you ensure the solution you choose is exactly what you need? To help you with your search, we’ve pulled together 7 key questions every fast-growing business should ask before choosing a cloud-based ERP solution, including: more

  • How Finance Leadership Pays Off

    Oxford Economics recently surveyed 1,500 finance executives and it’s clear that small and midsize companies are growing significantly faster than larger companies. But, there are also big opportunities for finance to increase efficiency, boost financial performance, and work more strategically. Why is that? more

  • Professional Services Audience – Improve Profitability Infographic

    As a Professional Services Organization (PSO), you know the importance of customer satisfaction. In fact, 47% of PSO leaders say managing changing customer expectations is their top challenge. That’s why many firms are engaging smarter project management technology, even before deals are signed, to ensure project profitability. How are these leaders utilizing technology? Find out now. more