Living in a world of projects may feel like living in a WHIRL of projects. Small projects, large projects. Some projects using external resources. Projects for revenue, and others for cost saving. As projects come and go, how do we keep track of them? And what do we keep track of?
The first step for organizing our projects is actually pretty easy and provides an instant opportunity for saving money. A project inventory gives you three sources for easy cost savings.
It is human nature to make things better. Plus, there is the economic necessity to continuously be more productive. The result is a never-ending supply of projects.
We can over-do it though. In our efforts to make things better and be more productive we can actually make things worse by taking on too much. Since projects sprout up all over our organizations, they are a frequent source of over-commitment. To get the best result from our project investments, we must manage each project and the collection of projects. This approach is often referred to as project portfolio management.
The first step to managing the collection of projects is to figure out how many projects are out there. This seems pretty obvious. However, when organizations make this first inventory, it is common occurrence to find that far more projects have been initiated than can be completed with available resources.
To make your project inventory, follow these simple steps:
Establish the organizational boundary of your inventory. You may want to list every project that exists in the company. Or you might need to limit it to a department, such as Human Resources or Information Technology. This doesn’t need to be perfect to be valuable, so just set a boundary. Projects frequently cross organizational boundaries, so err on the side of listing more projects rather than less in this first step.
Develop categories that reflect the purposes of your projects. Common examples are revenue enhancement, cost savings, and regulatory compliance. But those are just the most general. Use categories that are meaningful within your organization, particularly categories that can be tied to strategic goals. Here’s a tip for your categories: Choose a few big categories, and then put in some sub-categories if necessary. The big categories will last for years; the sub-categories may change as the strategic goals change.
Get some basic data about each project. Every approved project should have some minimum common information such as goal, sponsor, project manager, start date, and target due date. All of this information can be listed in a simple spreadsheet.
This initial inventory of projects will give you and your management team plenty to talk about. Look for these quick opportunities for cost savings:
Redundant projects. “Great minds think alike.” Unfortunately, that can lead to different managers having the same great idea and pursuing it independently. Scan the list for projects that solve the same problem and get their sponsors to decide how to find a common solution.
Conflicting solutions. Independent initiative can lead to inconsistent and even conflicting projects. For example, are different departments in a healthcare organization investing in incompatible technologies and missing an opportunity to lower their deployment and maintenance costs? Sometimes the absolute best solution for an individual project isn’t the best one for the organization as a whole, but without visibility on all the projects, that can’t be discovered.
Low priority or strategically unaligned projects. Some projects linger on the back burner for a long time. Maybe they should just be canceled outright. Other projects won’t fit into a strategic category – a good idea that doesn’t fit the overall goals. These projects should generate serious discussion among the management team.
Project portfolio management entails much more than a project inventory, but this first step shows that you’ll get a quick return when you begin managing the collection of projects.