128. Project inventory overview (planning next years change portfolio)

October 5, 2013

PMO Planning

Project inventory construction processIn the 3rd and 4th quarters of a year, many organisations are planning and budgeting for the coming year.  This has to include any projects so that the budget can be secured.  So in this post I want to provide an overview how to construct a project inventory.

An organisation will undertake a number of change projects at the same time.  In a large, global organisation there could be thousands if not ten’s of thousand projects running at any given time.  Some will be small, such as report changes.  Others could be very large, multi-year projects.  This presents a challenge to many organisations.  How to track and ensure that change projects are aligned to the overall strategy.

In many cases, change will be specific to a specific function or business line and / or a location.  Therefore, it is difficult for the organisation to have a single view of all of the change activity.  This means that senior management will not have a clear sight of how the change budget is being spent, what benefits are being returned and crucially, be able to determine if the change budget is being spent wisely.

This is where an enterprise Project Management Office (PMO) can add considerable value.  The enterprise PMO should be able to link into all of the regional and local PMO’s so as to gain sight of all of the active change projects.  Even in a small organisation, having a central list of all change activity will be a benefit to management.

Objective of Project Inventory

Constructing a Project Inventory is a way for any PMO to quickly add value, especially where an organisation has not had a PMO before.  Instead of having to speak to many different functions, etc to understand all of the change, senior management can simply ask the PMO – a huge time saving.

While Project Inventory makes it sound like a complex process, it is simply a list of all active and planned projects for an organisation.  So for Project Inventory you can think “list of projects”.  So the simple objective of the Project Inventory is to capture all of the active and planned projects in a single list.

Constructing the Project Inventory

The PMO should take the lead on constructing the project inventory.  The approach can be:

  • Pull – ask all of the project teams to submit details of change projects
  • Push – create a central list and then send to project teams to review and validate

If possible I would lean towards the “Push” approach as it demonstrates that the PMO is trying to add value by taking on what work it can and then, only asking projects teams where they cannot complete the task.  This will create a positive reaction as opposed to the PMO being seen as simply making requests of the project teams and offering no support.

The reason this is important is that the project teams should be busy focusing on delivering the projects.  Therefore, a smart PMO will try to avoid making any requests that they can perform themselves without diverting the attention of the project teams.

Standard Format

Collecting the details of the projects is an important step.  However, to make the information easy to understand and compare, it should be in a standard format.  Therefore, if you decide to use either the “Push” or “Pull” approach, the PMO should spend time creating a standard template to collect the data.

While there are enterprise portfolio management tools, the simple approach is to use standard word processor or spreadsheet programmes such as Word and Excel.  I would suggest Excel as this will allow for data manipulation when you have gathered the data.  Another example of using standard programmes is that it makes it easier to share the information as most organisations use these programmes.

The template should include:

  • Project Name – recognised name used to identify project
  • Project Description – short description to allow easy understanding of project purpose
  • Project ID – <optional> used if there is an internal numbering system such as Clarity
  • Business / Function – used to indicate who the project is for
  • Location – used by global organisation to indicate regional or global
  • Investment Type – mandatory or discretionary
  • Budget – indication of approx. budget spend
  • Benefit – indication of project benefit in monetary terms
  • Comments – allows for any additional information

Collecting the above information should provide all of the information to give a high level understanding of the project.  With this information, senior management are able to make decisions on the change portfolio.

Having the information in a spreadsheet, it is possible to total the budget column, sort by Investment Type, allowing for the cost of mandatory projects to be calculated and compared against available budget.  This then will provide how much budget is available for discretionary projects.

Summary

The PMO can provide value to an organisation by collating and providing a central list of projects – the Project Inventory.  This will save management time by presenting a single list with all of the required data point to prioritise and make decisions.

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About Simon

Founder of practical PMO with a passion to share insights on designing and building practical, pragmatic PMO's. Posted by Simon Wilkinson, PMP

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