26 Mar Project portfolio management
Although construction is a project-based industry, management focus has recently shifted from projects to project portfolios to meet strategic objectives of companies that require holistic analysis of the projects undertaken. Dependencies between projects within a portfolio need to be taken into consideration since they may significantly affect the portfolio success with their combined effects.
Projects may share many resources and may have common objectives to be achieved. Therefore, there can be a resource, outcome, market/benefit, financial, or learning dependency between projects (Verma et al., 2002). Project success or failure is often linked to three key objectives: time, budget, and quality. Thus, projects need to be handled from a “portfolio” perspective and managed at the “portfolio level” as it has been widely discussed in the literature (Collyer et al., 2009; Elonen et al., 2003; Rungi, 2010). Portfolio success is considerably dependent on identification of relations between projects and generation of strategies accordingly (Verma et al., 2002; Elonen et al., 2003; Bathallath et al., 2016)
Portfolio management is a complicated process since it requires comprehensive analysis of strategic objectives, financial profit, project performance, demand conditions, resources, capabilities, risks and other similar parameters (Hadjinicolaou et al., 2017; De Reyck et al., 2005; Levine, 2005).
- Collyer, S.; Warren, C. M. J. (2009). “Project management approaches for dynamic environments”. International Journal of Project Management, 27(4):355-364.
- De Reyck, B.; Grushka-Cockayne, Y.; Lockett, M.; Calderini, SR.; Moura, M.; Sloper, A. (2005). “The impact of project portfolio management on information technology projects”. International Journal of Project Management, (7):524-537.
- Elonen, S.; Artto, K. (2003). “Problems in managing internal development projects in multi-project environments”. International Journal of Project Management, 21(6):395-402.
- Hadjinicolaou, N.; Dumrak, J. (2017). “Investigating Association of Benefits and Barriers in Project Portfolio Management to Project Success”. Procedia Engineering, Volume 182, Pages 274-28.
- Levine, H. A. (2005). “Project portfolio management: a practical guide to selecting projects, managing portfolios and maximising benefits”. San Francisco: Jossey & Bass.
- Rungi, M. (2010). “Success rate and resource consumption from project interdependencies. Industrial Management & Data Systems, 110(1):93-100.
- Vergara, A. J.; Boyer, L. T. (1977). “Portfolio theory: Applications in construction”. Journal of Construction Engineering and Management, 103(1):23 -28.
- Verma, D.; Sinha, K. K. (2002). “Toward a theory of project interdependencies in high tech R&D environments”. Journal of Operations Management, 20(5):451-468.