The Benefits of PPM

Project Health Chart Using SPI and CPI It is imperative that when project execution commences, executives focus on two important aspects: the performance of their portfolios and the ability to visualize the impact of any strategic changes to their portfolio. This cannot be left to just project teams or departments for the simple reason they most likely will not have an enterprise view. Monitoring and controlling the portfolio performance requires adopting performance management systems that can aggregate projects’ schedule and cost performance results. For example, the earned value process provides a number of performance indicators that can indicate whether a portfolio of projects is on schedule and/or on budget (Figure 4 shows a Project Portfolio Health Chart). Executives have the ability to aggregate key milestone dates in order to have a clear picture of their projects and portfolios.

Primavera PPM DashboardThe growing interest in project portfolio management has created great interest in what is known as Portfolio Analysis Dashboards. These dashboards provide executives with “a single version of the truth” about the status of their project investments by consolidating project information in different forms and in a real time environment. With project portfolio management applications such as Primavera PPM Solutions, executives as well as project leaders can collect and analyze the necessary information to proactively manage project portfolios. In the oil and gas industry, Primavera solutions have broad adoption for a number of reasons. First the majority of oil and gas organizations globally (and in the region) have standardized on Primavera’s PPM solutions for managing their different types of projects and programs from plant expansion to maintenance work. This also applies to project management contractors, EPCs, general contractors and engineers who work for those organizations. This means that the data that project portfolio management requires for generating the dashboard content is readily available in a format that does not require recreation. The second reason is the flexibility in designing multiple dashboards with different graphical and tabular portfolio analysis reports depending on the unique needs of the user. And all of this is a fully web-enabled solution that provides access anywhere at any time for those who have the right access rights—whether in the boardroom or in the field.

Conclusion
As the pressure to successfully plan, select and execute projects grows, leaders with a strategic portfolio will be best positioned to succeed. Project portfolio management solutions, such as Primavera solutions from Oracle, enable executives and project leaders alike to successfully identify the best strategies and opportunities for existing and future projects. With this understanding, oil and gas leaders in the GCC countries can thrive during challenging economic times.

Possible Project CategoriesThe alignment phase allows executives within organizations to take an active role in identifying all possible project investments that an organization needs to take to achieve its strategic goals. These projects are then categorized according to which strategic objective it fulfils, the business unit it belongs to, risk levels, etc. (See Figure 3 for an example of categories). This categorization provides the information needed for evaluating investments and rating them, which would lead to determining what projects the organization will select. Priorities need to be assigned based upon project interdependencies (some projects could depend on other projects), constraints on funding, resource availability and other factors. A key challenge that faces organizations before selecting the final list of approved capital projects is to ensure that project portfolios have been balanced for risk exposure, return on investment, and line of business goals, among others. Applied against these criteria a final list of projects will be created.

The PPM Process

PMI® PPM and PMBOK 3rd Edition Standard ProcessesThe Project Management Institute (PMI®) standards for project portfolio management identify a number of processes that need to be implemented. These processes are grouped into two phases: Aligning, and Monitoring and Controlling (See Figure 2). Under Aligning, there are processes for project identification, categorization, evaluation, selection, prioritization, portfolio balancing and authorization. The second phase, which becomes

active when a project is sanctioned, contains portfolio reporting and review, and strategic change.