Influence of Project Portfolio Management on Individual Projects

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Table of Contents

Introduction
Literature Review
Methodology
List of References

Introduction

Background

Project’s success depends on a number of factors, and the prevailing conditions within a given business. Project portfolio management is always important when a firm is planning on how to influence all the projects positively.

An individual project can be influenced by project portfolio management in various ways, as will be discussed in this research paper. Due to the demand and desire to compete effectively in the world market, researchers have directed a lot of their attention in projects management.

In the past years, little of project portfolio management was known, but now in the current world, things are changing with the many changes taking place in various sectors. People, including scholars and business managers, have become very innovative.

Modernity is taking place at a very high rate and so many changes are observed in the world market. This calls for a proper project management for any project’s goals and objectives to be realized.

According to Kousholt (2007, p. 34), projects are identified and classified into various categories mostly during the initial stages of a project. There is a raised concern to come up with a better project management approach in order to march with the competitive market environment.

This means that a project needs to be managed as part of the portfolio within the organization. Several arguments have come up showing that portfolio managed has been noted to have very positive effect on a single project’s success.

According to Murch (2004, p. 112), success of a single project may be pegged on how the top management manages the project portfolio. In the portfolio of projects, there are different projects that have different weights.

The top management should know how to award both material and moral support to each project in the portfolio. This will demand that this management have a clear understanding of all the projects in the portfolio.

When there is a general lack of understanding of the project portfolio, it means that the relevant authorities will have limited understanding of each individual project. This failure to manage the portfolio of projects would mean that individual project may not succeed because it was not well taken care of initially.

It is therefore, of interest to understand the influence of project portfolio management on success of an individual project. This paper aims at identifying the influence of project portfolio management on individual projects.

Aim

In every research, it is always important to clearly define aims of the project. According to Nagarajan (2005, p. 19), aims are the broader desired outcomes of a given project. They are the long term benefits that such a project should bring to the organization.

This scholar holds that a research should have specific aims that would define its path. It will be clear to all the stakeholders that such a project would be striving to achieve specific outcome in the long run.

This research paper is no exception. The aim of this research paper is intertwined in the research question which is stated as below.

What is the impact of project portfolio management on individual projects?

It is clear, from this research question that the aim of this project is to define the relationship between project portfolio management and individual projects. This is further elaborated in the subsection below on the objectives.

Objectives

Panneerselvam and Senthilkumar (2010, p. 89) define objectives as the subsidiaries to aim. This scholar holds that objectives are the exact answers to the question, which means that they are the specific steps to be taken when answering the question.

In a research process, it is important to clearly define research objectives because it helps others understand the scope of the project. It helps state the level beyond which the research may not hold.

In this research, the researcher developed research objectives to help define the scope of this research. This proposed research paper will address the following objectives.

To bring a clear understanding on how project portfolio management affects individual project.
To create an understanding on how project portfolio management can bring an overall success on a firm.
To create an understanding on how success of a single project among the portfolio of projects, can bring overall success to other projects and to the firm both in the short and long run.

Literature Review

Project Portfolio

According to Amrosini, Johnson and Scholes (1998, p. 73), project portfolio management refers to a process of centralizing management system of projects with the aim of maximizing financial gains while taking into consideration, the existence of various constraints and the interest of various stakeholders within the firm.

The world has increasingly become competitive, and firms are struggling to come up with various strategies that would enable them become competitive in the world market and enable them maximize financial benefits. A firm will come up with a project with an aim of increasing its financial gains in a given market.

Every project has its own constrains that the project managers must consider. As Kanda (2011, p. 89) states, project constrains must always be factored in when determining the appropriateness of a project.

Project portfolio refers to an assortment of projects that are to be managed in a collective manner in a way that will achieve organizational objectives.

It is important to note that the process of project portfolio management is a complex process that requires attention of all the stakeholders within the firm.

The project managers and project officials have the responsibility to ensure viability of the project as this will highly determine the effectiveness of portfolio management. This is so because, the interests of stakeholders vary, and their interests should be wisely considered in defining the viability of any proposed project.

According to Coulter (2009, p. 113), for a portfolio management to be effective, there is need to apply unique skills, knowledge and several other collection of tools together with techniques.

A combination of all these will enable the project managers and officials to effectively manage allocate various resources in the projects and boost the management at different levels of production in the firm and hence a high financial return.

As Coveney and Highfield (1995, p. 28) say, project portfolio management always have a direct effect on success of individual projects. It would therefore mean that mismanagement of the portfolio of projects will have a general negative impact on the individual projects.

Project portfolio management would always mean that the there will be a clear way on how each individual project will be managed overly by the top management. The top management should clearly state what is expected of each project.

This way, it should be clear to project manager for individual projects and the project members to have a clear understanding of what is expected of the project. They will know what is expected of them, and this way, they will act in a way that will help achieve the expected objectives.

Managing Single Projects

Managing of projects requires a great deal of understanding the project itself. Having a portfolio of projects would mean that the project coordinator will have to assign every single project to a group of individuals, headed by project manager.

When handling a single project, the project manager and project members must understand the objective of the project, and how it relates to the strategic objectives of the organization. The ultimate aim will always be to ensure that the project helps in achieving the long term goals of the organization.

In managing single projects, the first issue that should be considered is the project’s goals and the constraints that it faces. The goals should be defined in a SMART (Specific, Measurable, Attainable, Realistic and Timely) approach.

Having defined the project, it would be necessary to determine the constraints that the project would face in the implementation process. In most of the cases, time and finance are the leading constrains in a project. It is important however, to go beyond these two obvious constrains.

There must be specific constrains that are unique to the project. In managing such a project, the project manager will be responsible for explaining to the project members all the project deliverables, and how each member will play part in ensuring an overall success in the project.

According to Daft (2009, p. 92), managing a single project only means that the firm will be narrowing down to specific projects out of the available portfolio. Every single project will be aiming at achieving the long term goals of the organization.

The project manager will coordinate his or her team in a way that will ensure that each member understands his or her role in the organization. This understanding will not only ensure that there is no duplication of works, but also ensure that no task will have no one to attend to it.

As David (2008, p. 67) notes, when managing a project, it is important to involve various stakeholders, especially the customers. This scholar holds that in the current world, it is imperative to engage consumers in project management in order to help ensure that they own both the process and the final product.

When involved, they will feel that the product was part was as a result of their opinion, and for that matter, they will feel comfortable owning the entire project.

This is part of ensuring that there is a long-term return to the firm, especially if the firm retains such consumers. It is through this that there will be a general success in managing a single project.

Portfolio Management Effectiveness

It is very vital to ensure that portfolio management is effective given the fact that it has great influence on individual project’s success.

Success and effectiveness of a portfolio is derived from comparing the amount of total inputs allocated in the projects and the total outputs derived from the same while considering the satisfaction of consumers. The inputs and output are valued in terms of money and a difference between the two is obtained.

Many scholars argue that for a firm to measure the success and effectiveness of a portfolio several factors should be considered.

According to Coulter (2009, p. 56),a proper indicator of a successful and effective portfolio management apart from considering the financial returns, is by checking out the achievement of the project’s aims and objectives and the fulfillment of the ultimate mission of the project.

This also puts into consideration the portfolio fulfillment of all the stakeholders’ interests and expectations. Fulfilling the stakeholder’s expectations is vital for any successful and effective portfolio management.

The following are some of the indicators used in measuring performance and effectiveness of projects portfolio management.

Project Portfolio Management effectiveness Indicators

Indicator	How it is measured
Achieving results	Satisfaction of the customers, financial results, meeting of the scope, cost consciousness, quality to the stakeholders.
Achieving the purpose	Ability to achieve the defined project purpose.
Balancing of priorities	Successful balancing of the resources in a way that offers satisfaction to all the stakeholders.

Methodology

In every research, it is always important to define the methodology that would be used in order to avoid confusion. There are two main research methodologies that are always used in the social science research.

The first approach is always the quantitative research. Quantitative research involves the use of facts and figures in empirical manner. Quantitative research involves systematic empirical study of a phenomenon by use of statistical tools.

Its main objective is always to employ mathematical theories and models in developing its generalization. Quantitative research is therefore, be very appropriate in this research, and therefore, would be used.

This approach would be useful in testing of the hypothesis in the research. It also helps in testing the validity of the research using statistical tools.

The second approach is always the qualitative research, also known as the deductive methods. The deductive approach uses descriptive data in explaining different phenomenon. This approach was very important in this research because it enabled the research to give a descriptive statistics to various facts under the study.

The ethnographic nature of qualitative analysis would be helpful in explaining the organizational culture that has direct impact on the organization.

Although this research will not entirely be based on qualitative research, its importance cannot be ignored, and as such, the research will have some elements of qualitative research in it.

Expected Research Duration

In every project, there must be a clear schedule that should be followed to ensure that it achieves its objectives. This project should be completed within four months.The system should be up and running within the four months from the day it is officially set operational.

List of References

Kanda, A 2011, Project management: A life cycle approach, PHI Learning Private Limited, New Delhi.

Kousholt, B 2007, Project management: Theory and practice, Nyt Teknisk Forlag, New York.

Murch, R 2004, Project management: Best practices for IT professionals, Prentice Hall PTR, Upper Saddle River.

Nagarajan, K 2005, Project management, New Age International, New Delhi.

Panneerselvam, R & Senthilkumar, P 2010, Project management, PHI Learning, New Delhi.

Amrosini, V., Johnson, G & Scholes, K 1998, Exploring Techniques of Analysis and Evaluation in Strategic Management, Financial Times Press, New York.

Coulter, M 2009, Strategic Management in Action, Pearson Higher Education, New York.

Coveney, P & Highfield, 1995, Frontiers of Complexity: The Search for Order in a Chaotic World, Fawcett Columbine, New York.

Daft, R 2009, Organization Theory and Design, Cengage Learning, New York.

David, F 2008, Strategic Management: Concepts, Pearson Higher Education, New York.

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