So we turned to Run, Grow, Transform. This seemed a much more intuitive scheme. Having just been to a Gartner conference, they of course had  gotten a thorough understanding (this being Gartner’s preferred model). But there were a couple of issues.

First, they felt that the Transform category had too high a threshold. It is the rare project that actually transforms how a typical company does business (with the exception of the high-tech world, of course). It is much more common for them to undertake strategic projects, which we loosely defined as furthering the strategic goals of the company. I’ve noticed many PMOs actually use the Transform bucket in this manner. But rather than keep with tradition and simply us Transform to mean strategic, we decided to rename the category.

Next came Grow, which on its face sounds pretty obvious. But does this apply only to projects that help the company grow? What about automation? We supposed that improving efficiency would grow the bottom line, but suddenly this was less intuitive. After bandying about several alternatives it was either Mike or Roger (that’s Mike Rinehart and Roger Larson to give credit where its due) came up with Improve. This was defined as anything that improves the operations or effectiveness of the organization. This then encompassed the grow projects along with any others that are more than simply maintenance.

Run did seem pretty intuitive. The idea of work required to keep things running (or KLO – keep the lights on) is pretty self-explanatory, so we kept that.

We then reviewed their portfolio and found we could much more readily identify projects as being in Strategic, Improve, or Run. And what do you know, Mike pointed out it also has an easy acronym – SIR!

So there you have it, a new project portfolio classification scheme, SIR. What does the community think? I’m really anxious to hear thoughts on this one!

Dave B.

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:

• Web site re-vamp to increase sales and customer satisfaction by streamlining the web experience.
• Employee self-service application to improve employee moral and gain efficiencies in HR
• SAP implementation to automate financial processes and improve decision support.
• Stabilization effort to improve performance of various core apps. For this customer, this should produce increased sales, improved employee satisfaction, and reduced help desk costs.

How, then, to look at portfolios of such diverse business outcomes? Rather than simply grouping projects by size or business unit (which is valuable, of course), some companies are now grouping by strategy or like outcomes.

A classic is by investment type, and the two popular models are:

• Run, Grow, Transform
• Strategic, Informational, Transactional, Infrastructure

Portfolios of like outcomes might look like:

• Employee projects
• Customer projects
• Transaction automation projects
• Infrastructure projects

Portfolios by strategy might look like:

• Gain market leadership
• Most satisfied employees
• Double revenues
• Low cost provider

Wait a minute, does this look like strategic alignment? You bet it does! But then, that’s the real reason we start projects in the first place – to better execute company strategy. And that’s why all projects should be aimed at business outcomes, not simple financial metrics.

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!)

What if PMOs could have a similar process? What if we had a funnel that allowed us to qualify project ideas step-by-step?

Currently, most PMOs take an idea and spend a lot of time and money giving it a full analysis before presenting it for final approval. How much time and money could be saved by funneling those ideas through some filters so that only qualified ideas are analyzed?

That’s the idea behind a Project Intake process. We start with an idea (hey – let’s redo the company website!), progress it to a request (here’s why we should re-do the website. It’ll pump up revenues!), qualify the request (the scorecard for the website redesign looks good!), create a full-blown business case (wow – the numbers for this redesign really pan out), then finally it becomes a project (the committee approved the re-design! Hooray!).

To work effectively, this really should be a portfolio process – not a project management process. Why? Because as we’re taking requests through the pipeline, they need to be compared to each other and winnowed down to the organizations ability to execute (budget, resources, and skills). By comparing requests as a slate early on, we can narrow down the number of requests that get the full analysis treatment, saving tons of money. By using a funnel approach, we can ensure the outcome is a portfolio of the most worthwhile projects that fit our organization.

So, do you have an effective Project Intake Funnel? If not, contact us. We can help you design one that fits your organization. And we’ll do so on an advisory basis, which gets the job done for a lot less than a consultant that looks like an FTE taking up desk space!

Just need a scorecard to help with that initial winnowing? We’ve got a best-practice scorecard that can be used as a starting point! And, of course, we can help you develop one tailor-made for your PMO.