I was conducting a portfolio management workshop at one of my favorite clients , VWR, a couple of weeks ago when the topic of classifying portfolios came up. The usual investment class options came up, namely the MIT model and the Run Grow Transform model.
The MIT model (Strategic, Informational, Transactional, and Infrastructure) was first developed [...]
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While project portfolio management owes its genesis to financial portfolio management, there are some key differences. The first is the outcome of the portfolio. With a portfolio of financial assets, such as stocks, the return is measured in the same common denominator: dollars. This allows us to create some common key measures of performance, such as return on assets, price/earnings ratios, ROI, etc. Projects, however, are not all directly tied to dollars. Some projects improve employee moral, some increase market share, and some simply make current operations more efficient. Another way to look at this is to think of each project as a business outcome. Companies invest in a project to achieve a certain goal. Recent examples from EIG clients include: Most PMOs I work with face the same problem: too many project requests and not enough time to do them all! I will admit, I’ve worked with one group that did not have this problem. They have plenty of money and were told that if it’s a worthwhile project, there’s ample funding and they can hire all the people they need. If you’re in that situation, no need to read on. Rest assured – the rest of us are envious! But, if you’re like the other 99% of PMOs in the world, you need a way to manage this onslaught of potential work. In the sales world, they have what’s known as the sales pipeline or sales funnel. This is a process whereby potential opportunities are matured, step by step, to fruition as a completed sale. Along the way, opportunities fall by the wayside. They may not have budget to buy, may not need the products on offer, or just don’t have enough interest. Sales will draw this process as a funnel that has several stages. At each stage, a number of opportunities will fall out of the pipeline. Hence, the funneling effect. They start as opportunities (hey – I’ve got someone’s phone number!), progress to prospects (they actually my call!), become qualified prospects (they have budget!), and finally customers (wow – they actually signed the contract!) |
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