Project, Program, Portfolio, Operations

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About this lesson

Portfolios are often comprised of programs which are often comprised of projects; all of which either create or support operations.

Quick reference

Project, Program, Portfolio, and Operations

Portfolios are often comprised of programs which are often comprised of projects; all of which either create or support operations.

When to use

Projects are seldom done in isolation from other projects or the rest of the organization.  Understanding the relationship between the project and the programs, portfolios, and operations that it must interact with will make it easier to identify and manage risk.  At the time a project is initiated, the programs, portfolios and operations should be identified.

Instructions

While there may be overlap, in many cases the people managing portfolios are different from the people managing operations.  And the people managing programs and projects are different from either of the other two.

Senior Management/Portfolio Management

These individuals are managing many projects, and possibly even other activities such as acquisitions or mergers, in order to implement a strategic objective.  They focus on how the projects work together to implement the strategy and position the business for competitive advantage.  They are most involved during project selection and then monitor major project milestones in order to ensure the strategic initiatives will be achieved.  They are seldom involved in detail management of programs or projects.

Operations Management

These individuals are often the recipients of the program and project results.  They need to ensure that their operational requirements and constraints are accounted for in the project results.  They usually are not directly involved in the day-to-day program or project management, although they may provide a resource for the Core Team.  These people are often conducting the technical reviews during the project to ensure that the project results are working correctly.  They are often the stakeholders who will determine when the project is finished.

Program and Project Management

Program and project management are responsible for the planning and execution of the project.  For all intents and purposes, programs are just mega-projects, normally comprised of several projects whose results will work in concert with each other.  Program managers rely on the project managers to manage the project activity and the program managers focus on the integration and overlap between projects.  However, both will use similar project management tools and both will work through their Core Team.  They take the strategic imperative from portfolio management and create a solution that is acceptable to operations management.

Definitions

Project: “A temporary endeavor undertaken to create a unique product, service, or result.” PMBOK® Guide

Program: “Related projects,subsidiary programs and project activities that are managed in a coordinated way to obtain benefits not available from managing them individually.” PMBOK® Guide

Portfolio: “Projects, programs, subsidiary portfolios and operations managed as a group to achieve strategic objectives.” PMBOK® Guide

These definitions are taken from the Glossary of the Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Sixth Edition, Project Management Institute, Inc., 2017.

Hints & tips

One of the customers of most projects and programs is the operations team.  Treat them as important stakeholders.

 

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  • 00:05 Hi, I'm Ray Sheen.
  • 00:06 Let's talk next about projects, programs, portfolios, and operations.
  • 00:12 Both the differences between them and how they're related.
  • 00:17 First, I need to define what I mean by projects, programs, and portfolios.
  • 00:21 They're linked, but they are definitely different.
  • 00:24 According to the project management body of knowledge, the PMBOK Guide,
  • 00:28 a project is a temporary endeavor undertaken to create a unique product,
  • 00:31 service, or result.
  • 00:32 Now, we've seen that definition already.
  • 00:36 But according to the PMBOK Guide, a program is related projects, subsidiary
  • 00:41 programs, and project activities that are manged in a coordinated manner
  • 00:46 to obtain benefits not available from managing them individually.
  • 00:50 And according to the pinpoints guide, a portfolio is projects,
  • 00:54 programs, subsidiary portfolios, and
  • 00:57 operations managed as a group to achieve strategic objectives.
  • 01:04 Let's take a look at the differences between each of this.
  • 01:07 First, let's start with projects.
  • 01:10 Remember, a project is a temporary endeavor undertaken to create a unique
  • 01:13 product or service.
  • 01:14 That means a project is focused on the deliverables.
  • 01:18 Get the deliverables completed within a specific time to a specific standard and
  • 01:23 within a specific resource budget.
  • 01:25 The key principle is to get the deliverables done.
  • 01:28 Now recall that a program is a group of related projects,
  • 01:31 subsidiary programs, and project activities managed in a coordinated way
  • 01:36 to obtain benefits not available for managing them individually.
  • 01:41 So we talk about a collection, usually, just a collection of projects.
  • 01:46 And they are managed in a coordinated manner.
  • 01:49 This allows the program manager to take advantage of synergies and
  • 01:53 benefits between the projects.
  • 01:55 Often, there are shared resources used across projects
  • 01:58 that have already developed special skills or knowledge.
  • 02:01 In addition, some projects can be accelerated by riding on the coattails of
  • 02:05 other projects, reusing their deliverables or facilities and equipment.
  • 02:10 Coordination is the key principle with programs.
  • 02:14 And now for portfolios,.
  • 02:16 Remember portfolio is projects, programs, subsidiary portfolios, and
  • 02:19 operations, manages a group to achieve strategic objectives.
  • 02:25 The first principle understand is that they are a group.
  • 02:27 They are collections, projects, programs, and sometimes operations each with
  • 02:32 their own project leader, project teams, and managers.
  • 02:36 They're managed together to achieve a strategy.
  • 02:39 That's they key to remember about a portfolio.
  • 02:41 It's a strategic focus.
  • 02:43 So, again, sometimes tradeoffs are made within the portfolio.
  • 02:47 For instance, a portfolio may have two research or investigation projects
  • 02:51 under way to determine the best path to achieve a strategy.
  • 02:56 At some time, the portfolio will cancel one of those and just focus on the other.
  • 03:01 So, let's talk about the operations and
  • 03:03 how do we interact with projects programs and portfolios.
  • 03:07 Operational departments in a business or
  • 03:09 organization operate in a fundamentally different manner from projects
  • 03:13 with respect to at least one very important condition.
  • 03:16 Operations are continuous.
  • 03:19 Once they get started, they keep going again and again.
  • 03:22 They're continually making the product, or continually answering the phone calls,
  • 03:27 continually running through their normal daily processes.
  • 03:30 Projects have a start and a stop.
  • 03:32 They are a temporary endeavor.
  • 03:35 When the project is done, it's done.
  • 03:37 Projects end, operations continue, as long as the organization is in business.
  • 03:43 Although projects and operations are different,
  • 03:45 there are definitely linkages between them.
  • 03:47 If we think to why we do projects, it's often to create, upgrade,
  • 03:52 or improve the existing operations.
  • 03:55 Operations come into existence through projects.
  • 03:58 The project ends, and the operational process begins.
  • 04:03 Projects often use operational resources to accomplish part of their project
  • 04:07 activities.
  • 04:08 Operational resources do the pilot run or beta testing.
  • 04:12 We may have operational resources doing project reviews and audits.
  • 04:16 And often we will have an operational representative on the project core team.
  • 04:21 Finally, the operational managers often are the stakeholders of projects and
  • 04:25 programs.
  • 04:26 Since the projects and programs will be improving or modifying their operations,
  • 04:30 they are involved in the oversight review and
  • 04:33 the stakeholder management of the projects and programs.
  • 04:37 Projects, programs, and portfolios are linked together, and
  • 04:41 are often managed in a coordinated manner.
  • 04:45 There is a hierarchy that links them, and together they create and
  • 04:49 improve business operations.

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