Any suggestion on how to develop Portfolio Metrics? Also, what are the available metrics that can be used for Portfolio and which one you think brings the best value to an organization? Saving Changes...
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Mark Price PerryBusiness Driven PMO Evangelist| BOT InternationalOrlando, Fl, United States
For many PPM performing organizations, it can be helpful to think in terms of two kinds of portfolio metrics. One kind or set of PPM metrics is the collection of metrics that concerns itself portfolio management operations. Another kind or set of PPM metrics is the collection of metrics that concerns itself with the end results achieved of the portfolio. Using driving a car as an analogy, one set of metrics concerns itself with the engine being finely tuned and hittting on all cyclinders (operational metrics) and the other set of metrics concerns itself with are we getting to where we want to go (results). Naturally, no two organizations will have the exact same PPM goals in mind nor PPM operational conditions, hence there is no single set of metrics that is universally correct. To the contrary, both kinds of metrics need to be cast by way of prudent business planning - not just KPIs of PfM best practices.
In terms of a suggestion of how to develop PPM metrics, I would first look at the PPM related goals of the organization. For example, a professional services PPM performing organization might have quite different business goals than an EPMO or an SPMO or a new product development PMO. Hence, the two sets of metrics (operational and results) would be inherently different.
As the saying goes, if you do not have goals in place, show me your metrics and I will tell you your de facto goals - - - or show me your goals and I will tell you your metrics. In that respect, does your organization have business goals related to PPM in place?
Great post, many PPM performing organizations struggle with this and often put the cart before the horse...!
I agree with Mark's comments, and would add an additional dimension or two to the metrics...
Consider this: are you fundamentally interested in metrics as a mechanism to "describe" what has already happened, or, instead, to "predict" what you're expecting to happen at some point in the future?
You might want to track specific "descriptive metrics" (based upon ACTUAL results shown via key performance INDICATORS ) separately from another set of more "predictive metrics," which would be based on indicators of key performance PREDICTORS, which are used to show likelihood of future results, rather than actual measured results.
Additionally, I'd consider another dimension as well: look at three separate perspectives: are you trying to SUSTAIN, GROW or EVOLVE your business? The metrics you'd want to measure for "sustaining" your current business are likely to be quite different from the metrics you'd want to track for growing your business, or from those you'd use to change/modify/evolve your business toward some pre-determined "future state." It's likely you'll have some combination of these three, and yes, it's wise to track all three types over time, to ensure you're adequately addressing these needs.
Finally, I'd suggest one more thing: give some thought to exactly HOW you'll track, and TO WHOM you're planning to communicate these metrics, as well as FOR WHAT these metrics are intended to be used.
Once you've clearly articulated the answers to these questions, you'll need to COMMUNICATE your intentions for tracking this variety of metrics. If you make that effort, everyone who's impacted by the use of these metrics will understand why the metrics matter, and how your portfolio is likely to be managed as a result of expending your resources to perform these metrics-related activities.
Now, having given some thought to WHAT you want to track, are you ready to take a significant step BACK for a broader view?
Consider looking at WHY you want to track these portfolio-metrics, and verify that the metrics you're tracking actually LINK TO YOUR STRATEGIC PLAN.
If the metrics don't link to your stratetgic plan, I'd recommend you re-think which metrics you really want to track, and pursue only those which "move the needle" to show progress toward the strategic goals your organization has (presumably) determined.
Conversely, if you've identified metrics which seem to be important to your senior leadership, but are NOT linked to the strategic plan, you might want to have a conversation with your leadership about confirming that the strategic objectives you're pursuing are still the "right" ones.
Whether you change the portfolio-metrics or change the strategic plan, you'll need to make sure you're tracking the "right" indicators of progress toward the "right" goals! Saving Changes...
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