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”
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?
Introduction
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?
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
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
 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
Typical programs examples:
the development of a “product family“ (and not
of a single product),
the implementation of a comprehensive ITsolution (such as SAP),
the reorganization of a group of companies in a
holding structure, and
large investments, such as an oil platform.
Comparison of Programs and Projects
Program
Project
An organizing framework
A process for delivering a specific
outcome
May have an indefinite time
horizon
Will have a fixed duration
Evolve in lines with business
needs
Has set objectives
May involve the management of
multiple related deliveries
Involve the management of single
deliveries
Focus on meeting strategic or
extra-project objectives
Focus on delivery an asset or
change
Program manager facilitate the
interaction of numerous managers
Project manager has single point
responsibility for project’s success
Major Perspectives of Program
Management
Program management (Pellegrinelli 1997)
The technical and planning aspects
Scarce resource management
Establishment of appropriate information
systems
Program configurations
 Three archetypal
configurations
Portfolio
Goal-oriented
Heartbeat
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
 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
 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
Programs by technology/ platform
Programs by client
Programs by business vertical
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 .
Program Manager’s Role and
Responsibilities
Program
Manager
Effectiveness Coordination
Efficiency
Prior to
project
execution
Identification
1. Resource
of business
planning
opportunities 2. Synergy
identification
Resource selection
Project
execution
Identification
of bad
projects
1. Initiate reviews
2. Handling of
reviews
3. Coaching of
project managers
4. Process
Improvement
1. Participation in
steering groups
2. Prioritization
3. Collection &
aggregation of
reports
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
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
Non-numeric models
Sacred cow, operating necessity, competitive
necessity
Numeric models
Payback, NPV, ROI
Scoring models
Weighted factors models
Risk models
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 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
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
 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
Comments?
 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?