Project Management Maturity Model PMMM Project Portfolio Process

Project Management Maturity Model (PMMM) & Project Portfolio Process (PPP)

Project Management Maturity Model (PMMM) l l l Project management maturity refers to mastery of skills required to manage project competently. The foundation for achieving excellence in project management can best be described as the project management maturity model (PMMM), which is comprised of five levels, as shown in Figure. Each of the five levels represents a different degree of maturity in project management.

5 -levels of PMMM

● Level 1—Common Language: In this level, the organization recognizes the importance of project management and the need for a good understanding of the basic knowledge on project management, along with the accompanying language/ terminology. ● Level 2—Common Processes: In this level, the organization recognizes that common processes need to be defined and developed such that successes on one project can be repeated on other projects. Also included in this level is the recognition that project management principles can be applied to and support other methodologies employed by the company.

● Level 3—Singular Methodology: In this level, the organization recognizes the synergistic effect of combining all corporate methodologies into a singular methodology, the center of which is project management. The synergistic effects also make process control easier with a single methodology than with multiple methodologies. ● Level 4—Benchmarking: This level contains the recognition that process improvement is necessary to maintain a competitive advantage. Benchmarking must be performed on a continuous basis. The company must decide whom to benchmark and what to benchmark. ● Level 5—Continuous Improvement: In this level, the organization evaluates the information obtained through benchmarking and must then decide whether or not this information will enhance the singular methodology.

Degrees of difficulty of the five levels of maturity Level Description Degree of Difficulty 1 Common Language Medium 2 Common Processes Medium 3 Singular Methodology High 4 Benchmarking Low 5 Continuous Improvement Low

Project Portfolio Process (PPP) l l l Linking projects directly to the goals and strategy of the organization Means for monitoring and controlling projects Objectives: - Prioritize list of available projects - Eliminate projects with excessive risk - Avoid overloading of resources - To balance short-, medium-, and long-term returns

PPP Steps 1. 2. 3. 4. 5. 6. 7. 8. Establish a project council Identify project categories and criteria Collect project data Assess resource availability Reduce the project and criteria set Prioritize the projects within categories Select projects to be funded and held in reserve Implement the process

Step 1: Establish a Project Council l The main purpose of the project council is to establish and articulate a strategic direction for those projects spanning internal or external boundaries of the organization, such as cross-departmental or joint venture. Thus, senior managers must play a major role in this council. The council will also be responsible for allocating funds to those projects that support the organization’s goals and controlling the allocation of resources and skills to the projects.

Members of the project council are: Senior management; l The project managers of major projects; l The head of the Project Management Office, if one exists; Particularly relevant general managers; l Those who can identify key opportunities and risks facing the organization. l Without the commitment of senior management, the PPP will be incapable of achieving its main objectives.

Step 2: Identify Project Categories and Criteria 1. 2. 3. 4. Derivative projects Platform projects Breakthrough projects R&D projects

1. Derivative projects These are projects with objectives or deliverables that are only incrementally different (in both product and process) from existing offerings. l They are often meant to replace current offerings or add an extension to current offerings. l E. g. lower priced version, upscale version. l

2. Platform projects l l l The planned outputs of these projects represent major departures from existing offerings in terms of either the product/service itself or the process used to make and deliver it, or both. As such, they become “platforms” for the next generation of organizational offerings, such as a new model of automobile or a new type of insurance plan. They thus form the basis for follow-on projects that attempt to extend the platform in various dimensions.

3. Breakthrough projects l Breakthrough projects typically involve a newer technology than platform projects. It may be a technology that is known to the industry or something proprietary that the organization has been developing over time. l Examples here include the use of fibreoptic cables for data transmission, cashbalance pension plans, and hybrid gasoline -electric automobiles.

4. R&D projects l These projects are “blue-sky, ” visionary endeavors oriented toward using newly developed technologies, or existing technologies in a new manner. They may also be for acquiring new knowledge, or developing new technologies themselves.

Step 3: Collect Project Data Assemble the data l Document assumptions l Screen out weaker projects l The fewer projects that need to be compared analyzed, the easier the work l

Step 4: Assess Resource Availability Assess both internal and external resources l Assess labor conservatively l Timing is particularly important l

Step 5: Reduce the Project and Criteria Set In this step, multiple screens are employed to try to narrow down the number of competing projects. As noted earlier, the first screen is each project’s support of the organization’s goals. Other possible screens might be criteria such as: l Whether the required competence exists in the organization l Whethere is a market for the offering l How profitable the offering is likely to be l How risky the project is l

Step 5: Reduce the Project and Criteria Set l l l l If there is a potential partner to help with the project If the right resources are available at the right times If the project is a good technological/knowledge fit with the organization If the project uses the organization’s strengths, or depends on its weaknesses If the project is synergistic with other important projects If the project is dominated by another existing or proposed project If the project has slipped in its desirability since the last evaluation

Step 6: Prioritize the Projects Within Categories Apply the scores and criterion weights l Consider in terms of benefits first, resource costs second l Summarize the returns from the projects l

Step 7: Select the Projects to be Funded and Held in Reserve l l Determine the mix of projects across the categories Leave some resources free for new opportunities ‘Out of plan’ projects: Document why late projects were delayed and why some, if any, were defunded. One special type of delayed project is sometimes called an “out-plan” project. Allocate the categorized projects in rank order

Step 8: Implement the Process Make the results of the PPP widely known, including the documented reasons for project cancellations and non -selection l Communicate results l Repeat regularly l Improve process l

Project Proposals l l The project proposal is essentially a project bid Putting together a project proposal requires a detailed analysis of the project Project proposals can take weeks or months to complete A more detailed analysis may result in not bidding on the project as it may take long time

Project Proposal Contents Cover letter l Executive summary l The technical approach l The implementation plan l The plan for logistic support and administration l Past experience l

Risk l l “Risk” implies the potential for loss. Risks include… – – – The timing of the project and its associated cash flow Risk regarding the outcome of the project Risk about the side effects