Monday, April 01, 2024

Portfolio Management: Building and Managing A Practical Portfolio Roadmap with MS Project (Part – 1)


Project creates, programs guides, portfolio decides. 

    - Quote from bookI Want To Be A PfMP – the plain and simple way

Project is all about deliverables and it creates a unique product, service or result. Program is all about getting benefits by coordinating the components within its scope. Portfolio, on the other hand, is about meeting the strategic business objectives of an organization with a collection of right portfolio components. Hence, it decides. 

It’s portfolio that decides which component project to take and which one to drop, which component program to take and which one to drop. At the portfolio level, you not only authorize the components, but also can deactivate or even terminate a component. Most important of all, it’s portfolio which directly links the organizational strategy to a prioritized set of programs, projects and operations. Portfolio is completely strategic in nature, whereas programs and projects are typically tactical. Because with portfolios, an organization achieves its strategic goals and objectives, which are outlined in the organization’s strategic plan. 

By this time, you would have begun to realize the importance of portfolios and portfolio management. It’s key to have consistent success for an organization, deliver predictably and remain ahead of the curve. 

Now, to successfully enable the portfolio manager and hence, C-suite executives, a widely used artifact or key deliverable is the Portfolio Roadmap. In this article, we will know more on Portfolio Roadmap, and how to build such a roadmap with MS Project software.

This series: Part – 1

Portfolio Roadmap

Let’s start with the definition of portfolio roadmap. As per Project Management Institute (PMI®):

Portfolio roadmap is a document that provides the high-level strategic direction and portfolio information in a chronological fashion for portfolio management and ensures dependencies within the portfolio are established and evaluated.

Illustrating further on the above definition, you can say the following about the portfolio roadmap:

  • Graphically shows all the portfolio components (elements) to achieve organizational strategy and objectives.
  • A high-level plan for your portfolio and based on it, low-level details will be prepared. The low-level details include the low-level schedule and timeline of portfolio components such as projects, programs, operations or other work. 
  • Provides the foundation or initial basis on which internal and external dependencies are established and evaluated.

A portfolio roadmap is crucial because it shows the strategic intent of the organization in a visual (graphical) way. Irrespective of the approach used in portfolio management such as predictive (waterfall), adaptive (agile), hybrid or any other, the roadmap acts as an information radiator.

From Portfolio Strategic Plan to Portfolio Roadmap *** UPDATED ***

The significance of a portfolio roadmap is further emphasized in the flow of processes in portfolio management. A portfolio primarily exists to achieve the strategic business objectives of an organization. The vision, goals, strategies and objectives of a portfolio are listed in the Portfolio Strategic Plan (PfSP), which is created in Develop Portfolio Strategic Plan process. The PfSP drives the development of Portfolio Charter (PfC), created in the Develop Portfolio Charter process. 

The PfC links the portfolio to organizational strategy and formally authorizes the portfolio and portfolio structure. Next, PfC drives the development of the Portfolio Roadmap (PfRM), which is created with Define Portfolio Roadmap process. With the PfRM, the portfolio structure is visualized in a chronological manner. This is shown in the below figure. 

As shown above:

  • Organizational strategy and objectives drive the creation of PfSP.
  • PfSP, in turn, drives the development of PfC.
  • Next, PfC drives the definition and development of PfRM. 
  • All three above, i.e., the PfSP, PfC and PfRM drive the development of the Portfolio Management Plan (PfMP), which is another key deliverable in portfolio management. 

A Practical Portfolio Roadmap

With this background and fundamentals, let’s learn how to build a practical portfolio roadmap in a step-by-step manner. I’ll be using the sample given in PMI’s Standard for Portfolio Management, third edition and build on it with the MS Project software tool. 

To build the portfolio roadmap, we will have the following steps.

Step – 1: Add the Portfolio Components 

As noted earlier, a portfolio can have a number of components or initiatives. For our case, we have the following components:

  • Projects: Project A, B, C, D, E, F and G
  • Programs: Program A, B, C, D, E and F
  • Operations: Business Area 1, 2 and 3 Operations

Each of these components are to be added as tasks into the MS Project plan (.mpp) file. As you add, you should also provide the high-level timeline for each component as shown below. 

As shown above:

  • We have multiple projects, programs and operations added into the initial Portfolio Roadmap.
  • For each portfolio component, we have duration, start and finish dates. These are high-level details. The portfolio roadmap is prepared iteratively and repeatedly adapted. 
  • On the right side of the Gantt Chart, we have portfolio components represented as horizontal bars.

Also, do ensure that the timescale is properly customized. To do so, go to the timescale part of the Gantt Chart’s graphical side (on top), right click and choose “Timescale…”. 

As shown above:

  • We have just one tier (middle). 
  • Units used are “Months”.
  • Label used is “Jan ‘09”.

Adjusting the timescale will result in a better visualization for your roadmap.

Step – 2: Differentiate the Components 

In this step, we will differentiate the components to have more clarity in our graphical representation. For this purpose, I’ll add two custom fields by going to the Format tab > Columns group > Custom Fields command. Both the custom fields are of Boolean type. 

As shown above, we now have two Boolean custom fields: isProgram and isOps. These will be used in the next step.

Step – 3: Format the Bar Styles for Components

In this step, we will add two more bar styles by going to Format tab > Bar Styles group > Format drop down menu > Bar Styles command. 

For our program components, we will have green color-coded bars with the isProgram flag applied, whereas for the operation components, we will have orange color-coded bars with the isOps flag applied. 

In addition, for all the portfolio component bars, we will have the end shape changed to inverted triangles, along with the type and color. This is shown and highlighted below.  

As shown above:

  • For the project components, we have the default blue colored bars. The end shape has been changed. For the program components, we have the green colored bars. And for the operation, we have orange colored bars.
  • The respective conditions applied for the components are:
    • Normal, Active, Not Manually Scheduled (project components)
    • Normal, Active, Flag1, Not Manually Scheduled (program components)
    • Normal, Active, Flag2, Not Manually Scheduled (operation components)
  • For all bar styles, the end shapes have been changed. This clearly shows the finish time of the respective components. 

In the next part of this series, we will do more customization of the Portfolio Roadmap, which will make clear distinctions among component programs, component projects and component operation.

We will also have a video demonstration of this Practical Portfolio Roadmap.

This series: Part – 2

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