I confess: I like PPM tools and I’m not a sales person. Scary, isn’t it?
Though I admit, I used to work for a tool vendor, selling tools and process consulting, but that was a long time ago now.
During my time, I have seen some very successful PPM (Project Portfolio Management) tool implementations but I’ve also seen some failures along the way.
In this post, I would like to give an overview on how PPM tools can be helpful in the daily life of a PMO Manager.
How to make the PMO successful
To start off with: There are many activities that you can do to make a PMO very successful, like providing training to Project Managers, performing resource supply and demand management or assisting with the project prioritisation process.
But one of the key and critical get rights is to provide the management team with information on the performance of the project portfolio investment. Management questions need to be answered quickly, for example: What is the forecast? Will we make our financial year target? We need to save $2mil from our portfolio budget, what would you recommend?
In order to answer the above questions, it is essential to have the supporting information compiled:
- In a clear and consistent format
- In a timely manner
- In an accurate and concise manner
Doing this will provide visibility around the project portfolio and will facilitate decision-making. Without this in place, it just becomes a guesstimate and the Business / PMO ends up flying blind.
There will be no way of knowing to what extent the project portfolio investment will support the companies 12 month objectives and where the portfolio will be financially at the end of the financial year.
There could even be possible costs to carry over, but you wouldn’t be able to see this until it happens. You end up with a PMO of fire fighters, who are reacting to events that unravel – rather than a PMO that is well planned, in order and controlled.
Typical Business Environment
Collecting and analysing the required information and data is hard. Often the information is stored not only in different places and in different systems but it often comes in different formats too.
For example: Project Managers might use MS Excel for their financials, MS Project for their project scheduling and then they might present status updates in the form of a PowerPoint presentation.
To continue, business cases are typically written in MS Word and meeting notes are often captured within various emails.
Some of the team expenses are directly entered into the expense system (for example Oracle) and team resource information can be found in an HR System.
No wonder it can be very difficult to get together all of the required information and it can turn into an absolute nightmare. Data collection and analysis is very time consuming and by the time the report is finished – the data is already out-dated and ad hoc reporting is nearly impossible.
Imagine that this process needs to be repeated every month again and again. There is hardly any time left for the PMO to provide any ‘real’ value.
Can PPM tools help?
So where can PPM tools help? What can they do for you?
In general all PPM tools can perform the following:
- They can create, manage and view project data that is entered and stored in a database. This includes project proposals, plans and ongoing projects.
Some PPM tools can help you with:
- Project prioritisation – assist with ranking of your projects by using scorecards.
- Project portfolio optimisation via scenario modeling: If we postpone one of our projects, what impact does this have on our portfolio investment?
- Plan projects and manage the execution of approved projects (work flow management).
- Manage the supply and demand of project resources. Viewing and managing the utilisation of your project team and assisting with hiring decisions.
How do tools work?
In order to get the tool to work for you, you need project data. The more data you have, the more information you get.
Data can come from key participants like:
- Project Team Members: who are entering their time against a project, which will translate into project cost (hrs * resource rate = cost)
- Project Managers: who plan and manage their projects (status, financials, risks, issues, action items…)
- PMO Managers: who set up new proposals and projects and who manage the governance process (gate ways, mandatory documents, financials)
- Team and / or Resource Managers: who enter resource requests and perform resource allocation
If your entire team is using the tool for planning and managing the project then you will get a holistic view of your project portfolio. If only some team members are using the tool – for example the IT department – then your information is incomplete and your predictions are not as accurate as they could be.
One important thing to remember: There is a saying: “Crap data in, will equal to crap data out”. I guess this is right. So, the quality of your data is key to your success.
How can you use tools to your advantage
Tools can make your life as a PMO Manager so much easier. They can save you time, money and effort at the following activities:
- Manage your project portfolio investment – provide visibility on project performance to facilitate decision-making. This includes: reports on programs, projects, and portfolios. Information on: plan, cost, budget, resource, schedule etc.
- Manage financials – regulate your financial health. Manage costs with time keeping, expense and capital expenditure tracking.
- Manage Resources – optimise your resource utilisation. Perform capacity planning and manage resource assignments.
- Prioritise portfolios – deliver the business value. Align projects with business priorities.
- Manage scope – react to changing needs. Capture, quantify, assign, and track actions, issues, risk, constraints, opportunities, and changes.
- Project Health Checks – PPM Tools assist in this purpose by giving management a comparison and summary of projects in a simple portfolio report that highlight variances from planned outcomes.
- Single snapshot of portfolio performance for PMO management to review and evaluate.
As I mentioned earlier, you can only get all of this information and assistance if the required data has been entered consistently into the system beforehand. Only then can you query the data and report on the data using the PPM tool.
What are the benefits of tools
PPM tools can help you with the following:
- Assist with labor-intensive tasks – e.g. collecting reporting data from many sources.
- Automate processes – e.g. workflow can be started to inform project members about an event and what to do next.
- Visualize data e.g. resourcing over or under allocation of team members, Gantt Chart views.
- Financial Modeling: monitor, estimate and forecast financials: Will we underspend or overspend?
- Enable you to support process standards – Projects need to go through phase gate approvals in order to access funding.
The main benefit for the PMO Manager is the time saving factor. In one of my previous assignments, I used to spend 5 days of each month compiling and analysing information for a monthly portfolio performance report. The data was stored in different systems and different formats which I had to collect manually. If I had a tool available to me I could have used my time more effectively.
Why tools fail to deliver full value
Based on all the benefits I mentioned above, everyone would agree to start using a PPM tool, right? So why do PPM tool implementations fail?
Here is a list of common issues and challenges:
Not all PPM tools will integrate with your current systems or in-house tools. For example, they might not be able to import or export your data from MS Excel or they cannot connect to your financial systems. In this case, the time-saving aspect will be reduced.
Another issue that some companies face is that the tool has too many features and it is too complex for the organisation. It’s like buying a Ferrari, when you only need a Fiat. For example – don’t use a tool like Primavera, when your projects are smaller than $5m, it’s just too complex.
In some instances the tool might be very hard to customise, it doesn’t fit your company’s process and you require a special tool consultant to make the tool work for you. It can become very costly and time consuming.
Another thing to consider is the post-implementation of the tool itself. Just because the tool has been installed, doesn’t mean it will be used. Training and ongoing support is crucial for the successful usage. A proper Change Management process needs to be in place in order to make the tool roll-out successful. Without this, the tool starts being used by so many different people in many different ways and the data is no longer meaningful or useable in the future.
Last but not least, it’s important to realise that the main people benefiting from a PPM tool and having the immediate advantage are the managers. The managers will now get reliable information based on the data produced by the new system.
However from the beginning, the project managers and team members have a lot of work to do and often most difficult of all is that they have to learn a new tool on top of getting on with their day job and getting things done.
The tool may not even be sufficient enough to resolve all of their challenges and provide all necessary solutions. It is always hard at the beginning and productivity will go down while everybody gets used to it.
More often than not, it’s the “what’s in it for me” question that is not well communicated i.e. the wider benefit for the company to meet their annual objectives. Communication is key to ensure that the tool is still used 12-18 months down the track.
What makes tools successful?
There are three conditions / common requirements you need to have in place in order to make your tool implementation and roll out successful:
1) Endorsement and support from your Business Executives
This is the key requirement for your success. Your tool implementation project needs a sponsor who is accountable for the success of the implementation and who will continue to drive and support the tool even after the tool has been implemented and is in operational mode.
If you don’t have the right sponsorship in place than there is little chance that your PPM tool will be used after 12 months.
If your sponsor sits within the IT Department, no business user will use the tool. You need to have a sponsor from within the business otherwise the result is that you will only get limited project information provided.
2) Change management strategy in place
Setting up and implementing a tool is easy! Piece of Cake! You can generally perform this activity in a few days. But when it comes to the adoption and the usage of the tool you need to have a proper change management strategy in place, which includes a communication plan, training, ongoing support, help desk support and maintenance.
3) Training and mentoring and on-going support
This is crucial for both existing and new team members who are required to use the tool. It’s important that enough training and support is provided to ensure the use of tool is embedded into the business. I’m not just talking a couple of days, I’m taking about weeks.
What tools are out there?
There are currently more than 100 software providers on the market, offering tools in the PPM space. They are targeted at different industries and different types of projects. Each of them has their different strengths and weaknesses.
If your company is using an agile methodology, you don’t want to use a tool like Primavera you are best using a tool like Rally or Jira.
For projects following PMBOK, I had good experience with Sci-forma. I have had many difficulties with Clarity, which is a dinosaur in comparison to some of the more recent tools. In my personal experience it is very slow and clunky, but this is something you might want to check out yourself and see what you think.
I came across a great website from Lee Merkhofer Consulting, who have done a tremendous job in putting a PPM tools list together. They have listed the most common PPM tool vendors so you might be able to find the right tool for you here.
Despite all the negative reputation PPM tools have, I strongly believe that organisations can benefit a considerable amount from using PPM tools to improve processes and to manage their projects portfolio investment.
Nearly all tool software options out there have a good data management and reporting capability. However, most current tools lack sufficient algorithms for identifying optimal project portfolios.
I hope you enjoyed this post. I would be interested to hear your experience of using PPM Tools. Did you get the benefits you were hoping to get? Looking forward to hear from you!