Long-term
organizational success relies on much more than just striving for wins on a
project-by-project basis. Earlier, Anand Jayapalan had
spoken about how businesses should try to build a cohesive project portfolio
that features a range of complementary, high value projects aligning with their
business goals. However, such a type of a portfolio does not come together
without any kind of considerable efforts. All of this starts with a
comprehensive and focused portfolio plan.
Portfolio planning
involves the process of determining which projects an organization must take
on. It is considered to be a foundational part of project portfolio management
(PPM). Portfolio planning acts as the connective tissue between high level
strategic planning that often sets the direction of the whole company and
project-level planning. In the past, Anand Jayapalan had spoken about how
having an effective portfolio plan in place would make it easy for companies to
assess risk across several ongoing projects, while also making sure that each
of them does contribute to their strategic objectives. A portfolio plan would
also help business leaders to make sure that their available resources shall
not be strained beyond the breaking point.
A form of portfolio
planning also widely used in the financial industry, while putting together a
group of investments. However, planning a project portfolio is its own
discipline, and involves distinct practices and a unique perspective. Companies
across industries, including construction, power, transportation, as well as
oil and gas, can benefit from the implementation of a project portfolio
planning process. Here two major ways portfolio planning can help a company
become more successful:
· Improved decision-making: One of the biggest advantages of portfolio planning is improved decision-making. As a company maintains a centralized system for evaluating and comparing discerning ongoing and potential projects, it would be in a better position to make informed choices about which projects to pursue. This would involve properly assessing the potential ROI of every project, its alignment with strategic objectives, as well as resource requirements. Based on their assessment, companies should try to prioritize projects that offer the highest value and are most likely to succeed.
·
Optimized resource allocation: Portfolio
planning plays an instrumental role in making sure that resources such as time,
money, and personnel are allocated across projects in an efficient manner. A
comprehensive view of all projects can allow managers to seamlessly identify
resource bottlenecks and distribute resources where they are needed the most.
This helps avoid over-allocation to certain projects while others suffer from
underfunding. It also improves the ability to balance short-term demands with
long-term strategic goals, making sure that no project is left under-resourced
or neglected.
Earlier, Anand Jayapalan had
spoken about how portfolio planning is necessary to make sure that a company is
able to identify and mitigate risks associated with its projects. By evaluating
the risk profile of each project within the portfolio, managers can anticipate
potential issues and develop contingency plans. Having such a proactive
approach to risk management reduces the likelihood of project failures and
minimizes the impact of any issues that do arise.