The first managers to scale the pinnacle of Portfolio Management have recently qualified. Management of Portfolios (MoP) is the new Best Practice Guidance released by the Office of Government Commerce, a part of the UK Government which owns PRINCE2, MSP, ITIL and P30. Senior managers from the UK, Canada and Brazil, studied in March for the MoP Foundation exam in Scotland, on the first course run since MoP was launched in February 2011.
Is “pinnacle” too strong a word to describe MoP? Personally, I don’t think so. It is the top layer of best practice guidance that has until – now been – missing, so yes, it’s at the pinnacle – or apex – of the PM world. OGC has even adopted the pyramid as the MoP icon.
More importantly in these tough economic times – where every dollar or pound spent is under great scrutiny – it is the tool that can ensure a business delivers all its strategic goals effectively.
MoP is not going to be right for every Project Manager now. But I’m convinced that now is the right time to get in on the act: before everyone else.
What is MoP?
In simple terms, MoP could be described as the effective way to manage a national football squad – harnessing the skills of the celebrity club players, bringing together the different playing styles while reigning in star egos in order to create a slick team that can score goals and win matches.
In formal terms, MoP provides practical guidance for managers of Portfolios and those working in associated roles and areas. It is a co-ordinated collection of strategic processes and decisions that together enable a more effective balance of organizational change and business as usual.
As such, Portfolio Management provides senior management with reliable evidence enabling better and more informed investment decisions. It goes beyond passive monitoring of progress, to actively managing the composition and delivery of the Portfolio as a whole, as well as ensuring teams are energized, benefits realization is optimized and that lessons are learned and applied going forward
By Portfolio we mean “the organization’s investment and the changes required to achieve its strategic objectives”. In simple terms: Programs + Projects = Portfolio. For MoP, an organization could be a business unit, a department of a corporation, part of a public sector body, or a national branch.
MoP has five Principles which will underpin successful Portfolio Management:
- Senior management commitment
- Governance alignment
- Strategy alignment
- Portfolio office
- Energized change culture.
MoP also describes the Portfolio Definition Cycle (identifying the right, prioritized, Portfolio of Programs and Projects) and the Portfolio Delivery Cycle (making sure the Portfolio delivers to its strategic objectives).
What can MoP do for a business?
What MoP offers an organization is a clear alignment between the strategic direction of the organization and what it is trying to achieve (ie its strategic objectives), through the Programs and Projects that are being delivered.
Portfolio Management determines whether or not there is a good fit to the strategic objectives. MoP helps managers determine if they are doing the “right” Programs and Projects and it may also highlight Programs and Projects which should not be undertaken.
In today’s rough economic climate, a clear line of sight between the business strategy and the actual benefits of the delivery of Portfolios, Programs and Projects can only help a business make the best decisions
Good Portfolio Management will help organizations:
- Run the right Projects and Programs, delivering a measurable contribution to strategic objectives
- Remove redundant and duplicate Projects and Programs
- Realize benefits that align with corporate strategy
- Report effectively to improve transparency, accountability and corporate governance
Who should use MoP?
Obviously senior managers and directors in organizations who are responsible for a Portfolio of Programs and Projects should be using MoP. But I think it is also relevant for all the traditional Project and Portfolio Management professionals. (And here we’re thinking about program managers, program directors, senior responsible owners and business change managers as well as Project Managers who are looking to move up).
As the essence of Portfolio Management is the involvement of a wide range of stakeholders who will all have a contribution to make to the successful delivery of a Portfolio, this widens the net to senior managers in HR, IT, and Finance.
Are you ready for MoP?
If you are still not sure whether MoP is the next step for you – or your organization – then The Executive Guide to Portfolio Management is a good introductory guidebook from OGC. One of the book’s key features is a checklist “Are you ready for Portfolio Management?” It helps you assess how far along the maturity model you are and how could you benefit from it.
The three-day MoP Foundation course, which the graduates took in Scotland in March, includes a 50-question multiple choice exam. There are no prerequisites for taking the training, although a familiarity with other OGC Best Practices would be useful as some of the concepts are common to PRINCE2, MSP, P3O and MoR etc. Later in 2011 an MoP Practitioner qualification will be available and the Foundation exam will be a prerequisite.
The trainer on the world’s first MoP Foundation course was my colleague Alvin Gardiner. He has been managing Portfolios for many years and is one of the most experienced Project Management consultants in Europe. Alvin, who is one of the first people qualified to train MoP, is an award winning PRINCE2 Practitioner, Trainer and Registered Consultant who was on the Scoping and Review Group for the latest refresh of PRINCE2.
Alvin’s experience across the broad PM world convinces him that MoP is just what many organizations have been looking for. “From my experience, organizations often struggle to get to grips with the change initiatives that they have underway and also the impact those change initiatives are having on the organization, and specifically how they align with what the organization is trying to achieve,” he explains.
“I think lots of initiatives start off because someone has a good idea. Where that good idea fits within the overall requirement of the organization and what it’s trying to achieve can sometimes be a challenge.”
Alvin adds that it is only when you start to pull together what the organization is trying to achieve in terms of Programs and Portfolios with what commitment it has to make, and then confirm that the Programs and Portfolios are actually the right ones, that the picture can begin to emerge. “When we start to get the level of senior management consideration and commitment to that, then they could see ultimately the future.”
Finding that “clear line of sight” from what is it you are trying to achieve as an organization to the benefits that you would like to deliver at some point in the future is the trick for Portfolio Managers.
“That’s why I think that the MoP guidance is a really useful contribution to the support of organizations actually achieving their strategic objectives,” says Alvin.
For all of us in the PM world, the recent economic woes have put the spotlight firmly on evaluation and rationalization of what organizations are undertaking. It is not surprising that interest in Portfolio Management has grown. The fact that the great wealth of experience has now been distilled by OGC into a Best Practice Guidance and it is available as a standard for Portfolio Mangers to follow, is definitely good news for Project Managers everywhere.
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Paul Atkin is a leading authority on the PRINCE2 Project Management methodology. He combines over 20 years of hands-on Project Management experience with a unique insight from personally training more than 900 PRINCE2 students. This gives him a deep – and intuitive – understanding of PRINCE2. As Founder and Chief Executive of Advantage Learning, http://www.advantagelearning.co.uk/ Paul has harnessed his enthusiasm to gather a talented team of PRINCE2 consultants and trainers who deliver official training on four continents.