P3M FRAMEWORK IMPLEMENTATION

Table of Contents1: Introduction32: A critical P3M framework that supports an enterprise to achieve its benefits strategically32.1: Key objectives of a P3M framework and its definition52.2: P3M framework methodology92.3: Definition of desired and current level of P3M maturity112.4: Communication of several benefits of P3M to stakeholders and leadership of the enterprise153: Implementation of Scoring Model and Strategic Bucket to incorporate the goal of strategic alignment in the organization portfolio.193.1: Application of scoring model193.2: Application of strategic model204: Quantitative analysis and select projects which are aligned to organization strategy235: Conclusion27Reference list28

1: Introduction

This report presents basic Project, portfolio and program management’s framework (P3M) which aids an enterprise to attain strategic and tactical benefits. In UK, it is estimated that more than 46 % of application development within reputed enterprises are majorly “challenged”, referring to their incompetence to deliver timely, budgeted and scope-adhered results. Furthermore, surveys show that more than 47 % of traditional projects are successful, 17 % are failures and 36 % are majorly challenged. Moreover, the report emphasizes on the need of essential management and budget for acquiring strategic benefits. As a matter of fact, it is witnessed that several IT projects costs more than hundreds, million pounds. However, it is known that the cost incurred in those projects is more than what is actually required and takes longer period to deploy. Such results in deliverance of technology which are obsolete by the time these projects are completed. Therefore, this report presents a certain productive P3M framework. Moreover, the report exhibits critical implementation of management mechanisms such as strategic bucker and scoring model, which assist an enterprise to incorporate major goals of strategic alignment within the organization portfolio. Moreover, this report presents productive application of program management principles, which assist an organization in majorly coordinating projects for strategy implementation and change management in an organization. The ultimate segment of this report presents a certain selection and quantitative analysis of projects which are aligned to an enterprise’s strategy (Harpum, 2011).

2: A critical P3M framework that supports an enterprise to achieve its benefits strategically

In order to determine an appropriate P3M framework for an enterprise, the management of a particular enterprise needs to decipher the issues that are necessary to be addressed. For instance, this report constructs a definite problem statement, adhering to which, the report presents an effective P3M framework. The problem statement is determined in the below given manner:

· It is often witnessed that there is a certain lack of standardized project management procedure across an enterprise or organization

· The project manager considers leveraging various tools for productively tracking projects

· The costs incurred for projects are essentially tracked at several levels of descriptions or details

· Absence of certain consistent way of controlling and monitoring project performance

According to Harnois-Déraps et al. (2013), the application of skills, knowledge, techniques and tools to various project activities in order to meet requirements of the project is referred as project management (PM). Neelov and Holm (2010) argued that projects are temporary and are required to incept a particular service, product or an outcome. However, it should be noticed that PM has a predetermined time results and period, which can be determined as unsuccessful and successful (Di Rienzo et al. 2012).

Furthermore, an enterprise’s centralized management of a certain group of associated projects in order to derive control and benefits is referred as program management. Major themes of such management procedure would be stakeholder management, benefits management, program governance, and financial management respectively (PgM). However, Matyash et al. (2010) opined that centralized management of multiple or a single portfolio, which may include prioritizing, authorizing, controlling, ascertaining and managing projects, programs or any other associated work, in order attain a specific business aim may refer to portfolio management. Value management, risk management, resource management, performance management and strategic alignment serve as key themes of this form of management (PfM). This report amplifies the role of the linkage of these attributes, which aid an enterprise in acquiring strategic benefits. The linkage between the above exhibited attributes are provided in the below given manner.

Figure 1: The linkage between programs, portfolio and projects

(Source: Guillot and Collet, 2010)

2.1: Key objectives of a P3M framework and its definition

As a matter of fact, P3M refers to a certain set of policies such as tools, processes, models and governance which are designed to aid or support an enterprise in order to render competence in acquiring tactical and strategic benefits from their investment, projects portfolios and programs.

For an enterprise, a typical P3M framework sets the below stated objectives. They are:

· Transparency: This refers to the line of sight into major decisions, benefits and performance

· Accountability: This refers to the thresholds of decision-making which are governed and defined by an enterprise’s management and ownership

· Compliance: This indicates the compliance with public and organizational sector policies, norms, guidelines and regulations

· Cost saving: This framework aims to eliminate any form of wasteful expenditure and spending, execution which are out-of-control, disconnected operations and re-inventions

· Optimization of funds: This framework further aids in obtaining optimal benefits for a certain amount expended and budgeted

· Realization of benefits: Aids in acquiring intended advantages and benefits as explained in the case of business

Figure 2: The basic lifecycle of P3M framework

(Source :)

The life cycle of this framework commences with the determination of organization’s strategy. The life cycle continues with the procedures of pre-selection and selection of value management and strategic alignment procedures (Podosokorskaya et al. 2013). The next possible phase, as witnessed from the above determined image happens to be the controlling phase where performance management is conducted, adhering the norms of resource and risk management. The last phase happens to be evaluation phase, when the strategy of acquiring benefits is majorly actualized (Di Rienzo et al. 2012). After the actualization of the strategy, pre-program preparation is considered, which sets a definite trajectory for program set-up and initiation. This step of program implementation is followed by deliverance of program’s essential benefits. However, it should be noted that the deliverance of this benefits adhere to the reports of benefits management and program governance. The benefits are acquired after the phase of program closure. Now the life cycle has entered a phase where it may determine essential courses for program initiation (Di Rienzo et al. 2012). However, the initiation procedure is conducted adhering to norms of scope management, integration management, cost and time management and quality management respectively. The next phase directs the management into planning, which avails an enterprise’s management to execute, monitor and control the human resource, communication, risk management and procurement management team for delivering work products as urged by an enterprise (Grangeon et al. 2012).

The methodology of implementing P3M framework is exhibited below:

Figure 3: The implementation methodology of P3M framework

(Source: Grangeon et al. 2012)

The implementation methodology adheres to the following provided attribute. They are:

· The methodology intends to support continuous improvement in order to meet certain defined outcomes

· Furthermore, the implementation methodology considers leveraging the best or superior in class people, technology and process

· It intends on leveraging industries best practices and several guidelines of the public sector

· It aims to acquire the stakeholder and leadership ownership and buy-in

2.2: P3M framework methodology

The methodology of P3M framework is provided below

Figure 4: The methodology of P3M framework

(Source :)

The methodology intends to leverage the best practices of an industry and major guidelines of public sector. The report further presents certain best practices of industries, which the framework aims to leverage (Gazhulina and Marychev, 2016). They are provided in the below given manner:

Industrial best practices for proper implementation of such methodologies

· Capability maturity model integrated (CMMI): This happens to be collection or an integrated model of certain “best practices” which are adhered to by an organization to dramatically enhance the efficiency, effectiveness, quality and product of procured services and product’s development work.

· Furthermore, the Project Management Institute facilitates organizations and practitioners with certain standards which describe superior practices, which are globally, recognized credentials which certify the expertise of project management. Furthermore, it certifies resources for major professional networking, community and development (Di Rienzo et al. 2012).

· The I T governance institute aids leaders of an enterprise to comprehend about the effectiveness of governance in making the IT successful in supporting an enterprise’s goals and missions

· Knowledge experience and capital aids in leveraging internal and external assessing, operating, implementing PMOs, offering best or superior in class people, tools and methodologies (Maeda et al. 2013).

Public sector best practices for proper implementation of such methodologies:

· IT investment management (ITIM) and Government Accountability office (GAO): The ITM offers a certain framework which happens to be a maturity model, comprised of 5 major progressive stages of maturity which an agency may achieve in its investment and its subsequent management competence (IT). However, it is determined that for each major maturity stage, the ITIM determines a certain array of critical procedures which must be appropriately in place for an enterprise to achieve that particular stage (Di Rienzo et al. 2012).

· The office of management and budget direction (OMB) – This particular agency encourages major organization to submit major justification of their investments adhering to the rigid benefits and cost analysis. Moreover, it requires the complete application of full life cycle expenditure. The agency directs full funding for expenditures which are to be appropriated in advance. The performance, schedule, costs are to be clearly be identified, measured through EVM (earning value management) along with ascertainment of risks. The agency requires significant large IT projects to be implemented within 90 to 120 days increments to acquire benefits sooner.

2.3: Definition of desired and current level of P3M maturity

Figure 5: Definition of desired and current level of P3M maturity

(Source: Tang et al. 2013)

Development of sequence plan and opportunity matrix

Opportunity

Aims and objectives

Benefits and outcomes

Time frame

The primary opportunity would be providing a regime of consolidated financial reporting and status

· Implementation and development of major standard report templates and provide essential procedures for their respective use

· Establishment of a certain repository of reports for historical tracking and reporting

· Implementation of automated reports dashboard and portals for major stakeholders to drill down through identified details and access

· Provision of consistent data or information and competence to majorly roll-up results from determined projects to programs to major portfolios

· Ability to exhibit competence which aids in focusing on future enhancements and improvements

· Less workloads for the resources and provision of easy access for the stakeholders

Short term

Improve the competence and ability of certain projects to deliver timely and budgeted schedules adhering to the stated requirements

· Developing procedures for constructing a certain project schedule by the application of WBS, resources and dependencies and essential resources, which are required for all major projects

· Furthermore, it aids in developing procedures and subsequent implementation, adhering to an integrated determined baseline review of all new projects, availing the management to assess schedules, expenditures estimates (to be incurred), resource and technical risk

· Implementation an ANSI 748-b complaint EVMS (earned value management system)

· Avails in procurement of standardized project timeframe and schedules which are to be assessed through critical path methods and can majorly be viewed across several projects to witness resource leveling issues

· Avails superior practices for hindering major project issues prior to commencement of the projects

· Provides an essential competence to control, monitor and forecast essential scope, cost variance and schedule during the early phases of lifecycle of the project

Short term

Table 1: construction of sequence plan and opportunity matrix

(Source: self developed)

2.4: Communication of several benefits of P3M to stakeholders and leadership of the enterprise

(Buy –in (refers to the sustained application of P3M frameworkParticipation (leveraging several P3M artifacts)Commitment (major stated desires for enhancements)Awareness (Recognition of any situation or problem)The major sustained communication to stakeholders and leaders for selling the value of P3M. )

Figure 6: Communication stream

(Source: self-developed)

Market research procedure and any form of alternative analysis

Figure 7: Performing market research and consideration of any form of alternative analysis

(Source: Tang et al. 2013)

Structure of the stand-up organization and charter governance bodies

Figure 8: Structure of the stand-up organization and charter governance bodies

(Source: Tang et al. 2013)

Suggests achieving small success initially, then consideration of complexity, benefits and risks

Figure 9: Basic planning framework

(Source: Di Rienzo et al. 2012)

3: Implementation of Scoring Model and Strategic Bucket to incorporate the goal of strategic alignment in the organization portfolio.3.1: Application of scoring model

Scoring models find their major applicability for major portfolio management and project prioritization. Projects are primarily scored adhering to several numbers of criteria set by management (Tang et al. 2013). The criteria are set as below exhibited manner:

· Strategic alignment

· Market attractiveness

· Product advantage

· Competence in leveraging major core competencies

· Risks v/s reward

· Technical feasibility

Therefore, the projects attractiveness score is a certain weighted addition of these stated items’ rating and emerges as a basis for majorly developing a rank ordered lists of these above stated projects. Below exhibited table demonstrates detailed lists of criteria as presented in scoring model.

The projects are denoted in a manner provided below:

· Strategic alignment- Epsilon

· Market attractiveness -Gamma

· Product advantage - Alpha

· Competence in leveraging major core competencies – Delta

· Risks v/s reward - Beta

· Technical feasibility – Omicron

Table 2: Illustration of projects adhering to the scoring model

(Source: Self-developed)

The above exhibited table provides a certain illustration of six determined criteria, where the projects are essentially ranked till no more resources are left, and the resources are majorly computed as FTE people (Tang et al. 2013.

The projects in the above stated table are listed adhering to the same criterion, which is NPV and project attractiveness score. The screening criteria here applied are product advantage and strategic advantage. Here the project attractiveness score is considered as the average of all these stated 6 criteria (though taken out from 100. This is primarily used as ranking criterion. From the above exhibited table, all the above stated projects are good ones, with a certain average score of 65 out of a score of 100. This would include projects till the enterprise is out the determined resources. Here the resources are measured by the certain formed FTEs (full time equivalent people). From the above exhibited table it is clear that there are major 4 projects which are essentially active (however, the resource limit happens to be 70 FTEs). The last two intents are majorly put on hold.

3.2: Application of strategic model

This essentially includes defining major goals of an enterprise and constructing a general plan of action to achieve those aims. This may include defining major strategic goals, general plan or action in order to achieve goals. Subsequently enterprises consider forced choices covering several key dimensions of strategy. Hence, based on formed strategies, the management may allocate R&D procedures and new procedures of product marketing for the product across every categories existing on each dimension (Di Rienzo et al. 2012).

This report presents some common dimensions, which are:

· Strategic goals: The management is required to productively split major resources across determined strategic objectives

· Product lines: The Resources are majorly split across several determined product lines for instance, how much the management considers spending on product line A.

· Type of project: The decision regarding what portion of resources needs to be allocated for development of new product

· A certain familiarity matrix: How resources are to be split adhering to different types of market

· Geography: The portion of major resources which are to be spent on several projects aimed for different geographic locations.

Table 3: The table illustrates 4 out of 12 buckets with determined spending targets in each determined buckets

(Source: self developed)

The above stated 12 categories or buckets of project types which are defined in this particular example. However, the above stated figure exhibits only 4 particular buckets (Di Rienzo et al. 2012). These stated projects are sorted adhering to buckets and they are essentially ranked within major columns complying with the method of maximization, which is ECV, a certain financial valuation such as NPV. Numbers within these determined models exhibit resources which are required to complete each project, in $ mil. It is noted that Bucket 1 becomes devoid of resources after a certain project L. However, bucket 2 indicates shortage of indentified food projects.

The management productively develops major strategic buckets, adhering to selected strategic dimensions (stated above) are merged into several buckers. For instance, the bucket may

· Projects for product development for major Products lines (A or B)

· Projects for cost reduction (for major product lines)

· Projects for product renewal (for products line D and C)

The next step would be determining the desired spending on each bucket, which associated with procedure of consolidation of urged splits of spending, as stated in the above exercise of strategic allocation. The subsequent gap analysis is determined by existing projects, which are segregated by the formed buckets and the overall existing spending by a particular bucket is carefully added up. The leads to identification of spending gaps as determined in the image. Hence, the report present that the project within each bucket are ranked adhering to the attributes. The management may either apply financial criteria and scoring model to consider this ranking within these stated buckets. Portfolio adjustments by the management are then determined, either through instantaneous project’s pruning or by essentially adjusting procedure for major future projects.

Figure 10: Strategic Bucket procedure for portfolio management

(Source :)

The business’s strategy essentially dictates the resources’ split into major buckets. Projects are majorly ranked within each bucket, but through application of several criteria in each particular bucket (Tang et al. 2013).

4: Quantitative analysis and select projects which are aligned to organization strategy

In this section, three different types of projects which are basically pursued in business world are selected to conduct the quantitative analysis after aligning with organizational strategy. Generally, in business operational projects, financial projects, feasibility analysis project, IT project and research and development projects are undertaken. These projects are undertaken for internal and external management of business after evaluating the market condition and needs of customers. Every business project is associated with risk because of market trends and customer preferences. Thus, the project managers for evaluating risk associated with projects conducts quantitative analysis. The term quantitative risk analysis is used by organizations when they are working with large and complex projects to measure the tolerance capacity of their organization to bear the risk (McNeil et al. 2015). In quantitative risk analysis, specified numeric values are determined, which will depict the impact of undertaken projects on business. Moreover, how the risk will affect the budget of project and its outcome will be evaluated with quantitative analysis.

There are different tools and techniques, which are used for conducting quantitative risk analysis in case of standardizing the undertaken projects by organization (McNeil et al. 2015). The most common tools and techniques followed by project managers for conducting quantitative risk analysis are briefly discussed in this context (Di Rienzo et al. 2012).

Sensitivity analysis: This technique helps in determination of risk, which can have potential affect on the undertaken project. In this method, how independent variables can affect the dependent variable of project is evaluated based set of assumptions (Haimes, 2015). The project manager uses this technique within limited boundaries when more than one input variable exist in the project. As for example, price of bond will change when interest rates will change in market. This technique is useful for taking decision related to investment project, operational project and feasibility analysis project (Haimes, 2015).

Expected monetary value analysis: EMV or Expected Monetary Value analysis is considered as statistical concept in which average outcome of the project is calculated after including certain assumptions, which can occur or cannot occur in future. In this technique, opportunities will be expressed as positive value whereas the risk will be expressed as negative value (Kendrick, 2015). In order to calculate EMV the value of possible outcome is multiplied with occurrence probability and after that, the results are added to get ultimate results. If positive value is derived then there are opportunities and if negative value is derived then there are chances of threats (McNeil et al. 2015). This technique is used in operational projects, feasibility projects and IT projects.

Decision tree analysis: In this technique, schematic representation is made after considering several decisions after considering probability of occurrences. Generally, the project managers use diagram of decision tree to reflect the possible scenarios, which can occur after taking the decisions (Kendrick, 2015). It should be noted that, in this technique, the cost associated with decision are mentioned and rewards and risk for undertaking the decision is also mentioned.

Figure 11: Sample of Decision tree approach

(Source: Kendrick, 2015)

This approach is helpful for the project managers in formulation of balanced picture of reward and risk associated with undertaken projects to deal with different situation. This technique is helpful in financial projects, feasibility project and research and development projects (Di Rienzo et al. 2012).

Program Evaluation and Review Technique: This technique is used for organizing, scheduling and coordinating different actions of project for simplification of process. This technique is used for reducing the risk associated with project, which arises due to complexities (Hulett, 2016). Generally, in this technique the time consumed by each event of project is divided according to total time of project to reduce the risk associated with delaying of project.

Figure 12: Framework of PERT technique

(Source: Hulett, 2016)

Scenario analysis: In this process, the expected value of portfolio is evaluated after assuming specific changes related to security factor of portfolio and time period. The project manager uses this technique to assess the changes in undertaken project portfolio value for occurrence of unfavorable event (Kerzner & Kerzner, 2016). In order to measure the economic or financial aspects of project project manager uses this technique. The project manager uses this technique for developing consensus of changes and monitoring progress of project.

Break-even analysis: In order to examine the relationship between variable cost, fixed cost and returns on investment portfolio project manager uses break-even analysis. This technique is also known as cost-volume profit analysis and applicable in any type of project for assessing the financial risk (Kerzner & Kerzner, 2016). Moreover, in order to assess profitability of undertaken project and the risk associated with earning profits are evaluated with this technique.

Interviewing: This technique is common and traditional technique for analyzing the risk associated with undertaken projects (Haimes, 2015). The project manager conducts interview with the stakeholders of project to obtain their opinion regarding the optimistic and pessimistic scenario, which can occurred after undertaking the project work (Kerzner & Kerzner, 2016). The opinions of stakeholders are analyzed to measure the effectiveness of risk on overall business activities.

From the above discussion, it can be said that if the project managers utilizes the quantitative analysis of risk for different types of project is necessary to make the undertaken project successful. These tools and techniques are also used for tracking progress level of projects so that if any uncertain event occurs after implementation of project can be mitigated with rationale decision (Kendrick, 2015). Apart from these, some of the techniques can be used for controlling the cost associated with project such as PERT, Break-even and Sensitivity analysis. Moreover, they play important role in controlling and monitoring the performance of projects (Hulett, 2016). Thus, it can be said quantitative analysis of risk associated with undertaken project not also help in increasing the productivity of project after monitoring and controlling cost. The techniques used for quantitative analyses are useful decision making after considering the potential risk and alternative actions (Di Rienzo et al. 2012).

5: Conclusion

This report presented basic Project, portfolio and program management’s framework (P3M) which aids an enterprise to attain strategic and tactical benefits. This procedure along with strategy implementation techniques may aid enterprises in acquiring definite strategic objectives, as stated above.

Reference list

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