Project portfolio management has won a major vote of confidence after an analyst study found that the use of supporting software could help cut project costs by over a third.
IDC claims to have carried out extensive research on project portfolio management (PPM) systems at 13 companies where it has been used for at least six months. It found that the number of redundant projects at the sites decreased on average by 78%, project failure rates declined by 59% and cost per project fell by 37%.
Gartner explains that PPM supports processes that integrate knowledge about costs, schedules and HR for investment prioritisation and to ensure the effective release of new deliverables, as well as to control investment in ongoing operations.
The method is seen as a way of injecting transparency and simplicity into how projects are defined, approved and delivered.
A core objective of the PPM process is to drive an optimal mix and sequencing of proposed projects to best achieve the business goals of the business executive. Outcomes are typically expressed in terms of hard economic measures, and weigh project costs against returns to steer investment decisions.
Resource allocation is a critical component of project management and PPM software is also used to determine how a set of projects can be executed in a specified time, given the finite development resources in the company, something usually called pipeline management.
The companies surveyed for the study all use PPM solutions from leading vendors, are from major geographical markets, and represent a variety of industries, maturity levels and sizes, IDC said.
Among the market leaders in the project portfolio management software tools sector, Planview and Primavera are perhaps the best known, HP offers its PPM Center, CA has Clarity, and there is Compuware’s Changepoint.
Gartner does note however that PPM is not restricted to specialist software. It says that the widespread use of products like Oracle E-Business Suite Financials with Oracle Projects for project costing, or Microsoft Project for project scheduling gives these two companies immediate entrance into many potential PPM accounts. SAP also has a standing in the sector.
To acquire quantitative information, IDC focused on each customer’s experience with regard to PPM benefits. The PPM solutions showed a return of $5.57 for every dollar invested and paid back the initial investment in just 7.4 months after the deployment was complete, according to the analyst group. The study was sponsored by CA.
