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Introduction to Program Management. James J. Jiang University of Central Florida, U.S. Organizational Maturity in Project-based Organizations. Definition: “the extent to which an organization practices organizational project management (OPM)” Extent implies “levels”

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Introduction to program management

Introduction to Program Management

James J. Jiang

University of Central Florida, U.S.

Organizational maturity in project based organizations
Organizational Maturity in Project-based Organizations

  • Definition: “the extent to which an organization practices organizational project management (OPM)”

    • Extent implies “levels”

    • Lets consider questions regarding different levels of success

      • Was the project done right?

      • Was the right project done?

      • Were the right projects done right?

      • Were the right project done right, time after time?


  • Financial portfolio

  • Role of top management in creating purposeful project investments

  • Link projects to business policy and organizational strategy

    • Terms portfolio and program are often used interchangeably

Why need programs
Why need Programs?

  • In order to allow for autonomous projects on the one hand side

  • But on the other hand side to assure the benefits of

    • organizational learning,

    • economies of scale, and

    • networking synergies in a program,

  • A specific program-organization is required.

Program definition
Program Definition

  • A program is a temporary organization for the performance of processes of medium and high complexity, which are closely coupled by common overall objectives. (Gareis 2000)

Program advantages
Program Advantages

  • The advantages cited by organizations using programs include:

    • greater visibility of projects to senior management and more comprehensive reporting of progress at higher levels

    • better prioritization of projects;

    • more efficient and appropriate use of resources;

    • projects driven by business needs;

    • better planning and coordination;

    • explicit recognition and understanding of dependencies

Program examples
Program Examples

  • Typical programs examples:

    • the development of a “product family“ (and not of a single product),

    • the implementation of a comprehensive IT-solution (such as SAP),

    • the reorganization of a group of companies in a holding structure, and

    • large investments, such as an oil platform.

Major perspectives of program management
Major Perspectives of Program Management

  • Program management (Pellegrinelli 1997)

    • The technical and planning aspects

    • Scarce resource management

    • Establishment of appropriate information systems

Program configurations
Program configurations

  • Three archetypal configurations

    • Portfolio

    • Goal-oriented

    • Heartbeat

Portfolio programs
Portfolio programs

  • Include relatively independent projects but have a common theme.

  • Emphasis is efficient resource utilization and leveraging existing knowledge or skills.

Goal oriented programs
Goal-oriented programs

  • programs which enable the management of initiatives or developments outside the existing infrastructure or routine.

  • provide a means of dealing effectively with situations where uncertainty prevails and learning is a prerequisite to making progress.

Heartbeat programs
Heartbeat programs

  • Enable the regular improvement of

    • existing systems,

    • infrastructure

    • or even business processes,

      via increments to functionality or occasionally an overhaul of the system or facility itself.

  • Minimize disruption to operations,

  • Maximizing the amount of new functionality or capability delivered to the business.

  • E.g.: Projects related to core IT systems.

Program management classification in it consulting firms
Program Management: Classification in IT Consulting firms

  • Programs by technology/ platform

  • Programs by client

  • Programs by business vertical

Program roles and structure
Program Roles and Structure

  • Typical program roles include:

    • program owner,

    • program manager, and

    • a program coordination team,

    • project Manager

    • Upper Management

  • Typical program communication structures are program owner meetings and meetings of the program coordination team .

Issues in program management
Issues in Program management

1. Project selection

2. Maximizing value of project portfolio

3. Balancing/prioritizing project portfolio for resource allocation

4. Best practices for managing project portfolios

Project selection process
Project selection process

  • Criteria for project selection

    • Production factors

      • Time until ready to install

      • Impact on business processes

    • Marketing factors

      • Size of potential market for output

      • Consumer acceptance

    • Financial factors

    • Personnel factors

    • Administrative and misc factors

Selection models
Selection models

  • Non-numeric models

    • Sacred cow, operating necessity, competitive necessity

  • Numeric models

    • Payback, NPV, ROI

  • Scoring models

    • Weighted factors models

  • Risk models

2 maximizing value
2. Maximizing value

  • Allocating resources for maximizing value of portfolio in terms of firm objective

  • Expected commercial value (ECV)

    Function of (NPV, Strategic importance, probability of technical/commercial success, development costs, commercialization costs)

  • Productivity index (Similar to ECV but also considers R&D expenditure remaining)

  • Dynamic rank ordered list

    Rank projects according to importance, NPV, internal rate of return and cal mean

  • Scoring models

    scale 1-5 on reward, strategy fit, strategic leverage, prob of commercial success, technical success

Balancing project portfolio
Balancing project portfolio

  • Balancing high-risk breakthrough R&D projects versus

  • Low-risk projects that produce near-term returns through incremental improvements to existing products

  • Perform high quality analysis of each project

    • Identify appropriate level of problem: technology, portfolio, strategy

    • Generate creative, achievable alternatives

    • Develop reliable information

    • Establish values and trade-offs: time and risk

    • Apply logical reasoning

    • Build commitment to action

3 balancing project portfolio
3.Balancing project portfolio

  • Plot projects on a portfolio grid according to technical difficulty and commercial potential

  • 4 quadrants

    • Bread and butter projects (low % and low value)

    • Oysters (low % of success but potential value)

    • Pearls (high success, high value)

    • White elephants (low potential value, long term)

4 best practices in ppm
4. Best practices in PPM

  • Senior management buy-in

  • Identify PPM focus areas and provide proof of concept

  • Develop governance process for projects

    • Makes PPM implementation easier

  • Use proven PPM tools

  • Develop a “common currency” to evaluate projects based on contribution to business objectives

  • Optimize portfolio against constraints


  • How does your organization select an project?

  • Is there a common goal among the selected projects?

  • Has the organizational goal been supported (i.e., aligned with) by those selected projects?

  • Do your employees understand the differences between “project management” vs. “program management”?

  • Do your organization implement the best “program management” practices?