The COE Approach to Project Management
When you are making personal investments, say for your retirement, you need a balanced portfolio. Your mother, and your financial advisor, always told you not to put all your eggs in one basket: you need to diversify, reduce risk, and maximize profitability when possible. If you expand this out, you have a good picture of project portfolio management. Executives need to diversify, spread out risk, and, always, obtain a return on their investment. Just as you would ask, “Is that stock going to help me retire to Tuscany?”; those managing project portfolios would ask, “Is that project going to help us further our business objectives and goals?” How do they make that determination?
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In the Centre of Excellence (COE) approach, which emphasizes experience and best practices, those reviewing projects consider the following criteria:
- Nature of the project
- Scope of the project
- Strategic objectives
- Project dependencies and interdependencies
- Systems impacts
- Business impacts
- Operational impacts
- Resource requirements
- Budget requirements
- Timelines
- Benefits (financial and non financial)
- Identified Risks
Notice how these areas are balanced: what are the expected benefits? What are the risks? What will it cost? And what will it return? What is the nature and scope of the project, and what are the strategic objectives? Do they align? Looking at each criterion allows executives to take a balanced approach to their project portfolio.
When considering projects, the COE approach encourages management executives to look at how projects will contribute to the value of the portfolio, how they will impact other projects, and whether they will achieve the desired strategic objective.
