Obiajulum OmoregieHead, Project Management Capability Building| Nawah Energy CompanyDubai, United Arab Emirates
Question for my fellow PMO leaders out there: when measuring the health of a Project Portfolio (i.e. the percentage of Projects that report "Green" over the total number of Projects in the Portfolio for each reporting period), what does Good look like? 80% Green? More? Less? Let me know your thoughts! Saving Changes...
Sergio Luis ConteHelping to create solutions for everyone| Worldwide based OrganizationsBuenos Aires, Argentina
In my personal expereince along the years the color depends on the value for each indicator. Define indicators and values depends on organizational strategy. In my actual work place we use 5 indicators: budget, schedule, resource, scope and risk. Each one has a color depending on some criterias. For example, regarding to risk, it will depend on the risk threshold accepted for each program inside the organization.
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1 reply by Obiajulum Omoregie
Dec 29, 2022 2:47 AM
Obiajulum Omoregie
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Thank you for sharing Luis. I like the strategy of determining value driven indicators and not sticking to the "Traditional" focus on schedule cost..etc,
There's many ways to translate health of projects up to a portfolio level.
One way is to do it based on the number of projects, but that treats each project the same.
Other ways I've seen it done are by budgeted cost - i.e. what percentage of the portfolio budget is green?
You could also do it by expected benefits which provides insights into the likelihood of achieving expected returns on the portfolio investment.
As far as where the thresholds should be, that needs to be discussed with your governance team or senior leadership team as they should be the ones establishing those.
Kiron
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1 reply by Obiajulum Omoregie
Dec 29, 2022 2:52 AM
Obiajulum Omoregie
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Kiron thanks for the insight. Indeed utilizing the "count of individual projects" undervalues the unique contribution, benefit and criticality of each project. A lot to discuss as we plan 2023. Thanks.
Saving Changes...
Stéphane ParentSelf Employed / Semi-retired| Leader MakerPrince Edward Island, Canada
To add to Sergio and Kiron's insight, I suggest that what is "good" will depend on your project portfolio's maturity.
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1 reply by Obiajulum Omoregie
Dec 29, 2022 2:52 AM
Obiajulum Omoregie
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Indeed. I guess that opens the door to a continuous evaluation as we mature yearly (or periodically). Thanks Stéphane.
"It Depends" - the most undervalued phrase in project management. but yes, i agree with you Abolfazi - it does depend.
Saving Changes...
Thomas WalentaGlobal Project Economy ExpertHackenheim, Germany
It depends on the purpose of the reporting, maturity of the organization and it might change.
Consider the extremes of 100% green or 100% red or even 100% amber. If you look at the portfolio you want to identify the projects you need to take action on.
It’s called an indicator to indicate something. If it shows all green you have a big problem and are blindsighted.
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1 reply by Obiajulum Omoregie
Dec 29, 2022 2:57 AM
Obiajulum Omoregie
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I think you touch on a pivotal point Thomas, we need to go to the why. A lot of times we desire the "Green's", but a focus on what is to be indicated and what message we drive is key. this is super useful. Thank you Thomas.
The first thing you need to do is define Red Amber and Green. That itself can be very contentious. Sometimes Red is off-plan with no recovery plan, amber/yellow is off-plan with recovery plan in place, and green is proceeding on plan. That masks the actual risk level though.
Is a late deliverable because one person is out sick for a day with no ECD really red? You will sometimes hear the phrase, "This feels more yellow than red." Risk based stoplight colors need more well defined criteria. What is red at an individual team level is different than what is red perceived by the C-suite.
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1 reply by Obiajulum Omoregie
Dec 29, 2022 3:54 AM
Obiajulum Omoregie
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Thanks Keith, i hear the need to define what matters most to my executive suite.
Saving Changes...
Peter RapinSubject Matter Expect; Project Delivery| Independent ConsultantOntario, Canada
Once you have defined the meaning of each designated colour you need to define what is acceptable in terms of project portfolio. If your projects are mostly run-of-the-mill initiatives then I would expect a high ratio of green. If your projects are industry leading, new technology initiatives requiring a high level of innovation and research, a higher ratio of red would be the norm.
Too much green may mean too risk adverse.
Too much red could mean recklessness.
Only after an evaluation of your corporate risk profile and understanding of your project types can you establish what "good" is.
In terms of portfolio performance I would try and evaluate the ability to recover projects from red and amber to green.
Note that the performance status of projects in the last 80% is much more critical than the first 20% - less time to recover. Saving Changes...
Obiajulum OmoregieHead, Project Management Capability Building| Nawah Energy CompanyDubai, United Arab Emirates
Dec 28, 2022 5:50 AM
Replying to Sergio Luis Conte
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In my personal expereince along the years the color depends on the value for each indicator. Define indicators and values depends on organizational strategy. In my actual work place we use 5 indicators: budget, schedule, resource, scope and risk. Each one has a color depending on some criterias. For example, regarding to risk, it will depend on the risk threshold accepted for each program inside the organization.
Thank you for sharing Luis. I like the strategy of determining value driven indicators and not sticking to the "Traditional" focus on schedule cost..etc, Saving Changes...
Obiajulum OmoregieHead, Project Management Capability Building| Nawah Energy CompanyDubai, United Arab Emirates
Dec 28, 2022 7:45 AM
Replying to Kiron Bondale
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Obiajulum -
There's many ways to translate health of projects up to a portfolio level.
One way is to do it based on the number of projects, but that treats each project the same.
Other ways I've seen it done are by budgeted cost - i.e. what percentage of the portfolio budget is green?
You could also do it by expected benefits which provides insights into the likelihood of achieving expected returns on the portfolio investment.
As far as where the thresholds should be, that needs to be discussed with your governance team or senior leadership team as they should be the ones establishing those.
Kiron
Kiron thanks for the insight. Indeed utilizing the "count of individual projects" undervalues the unique contribution, benefit and criticality of each project. A lot to discuss as we plan 2023. Thanks. Saving Changes...
Obiajulum OmoregieHead, Project Management Capability Building| Nawah Energy CompanyDubai, United Arab Emirates
Dec 28, 2022 8:04 AM
Replying to Stéphane Parent
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To add to Sergio and Kiron's insight, I suggest that what is "good" will depend on your project portfolio's maturity.
Indeed. I guess that opens the door to a continuous evaluation as we mature yearly (or periodically). Thanks Stéphane. Saving Changes...
