Russell D. Archibald
PMP, PMI Fellow

PMI-Texas Connection 2001
Sept. 14-15, 2001 Houston, Texas.
Published here March 2002.

Abstract | Challenges | Full Power | Business Strategies | Objectives
Portfolio Management | Process | Principles | Key Roles | Planning & Control
Team Working | Improvement | Integration | Internet | Conclusion

Integrated Project Portfolio Management

Rather than attempt to manage individual projects as if they were stand-alone endeavors, executives have learned over the years that every project is always interrelated, primarily through the use of common resources, with some„if not all„other projects in the organization. Relating selected projects within a program is often a step in the right direction. Organizations have progressed from single project and program management to multiple project management, and they are now moving rapidly to project portfolio management. Dye and Pennypacker show the key differences between portfolio and multiple project management in Table 2.


Project Portfolio Management

Multiple Project Management


Project Selection and Prioritization

Resource Allocation




Planning Emphasis

Long & Medium-Term (annual/quarterly)

Short-Term (day-to-day)


Executive/Senior Management

Project/Resource Managers

Table 2. High-Level Comparison of Project Portfolio Management
and Multiple Project Management [7]

As indicated in Figure 3, the project portfolio consists of the programs and projects supporting a given higher-level strategy. There could be only one overall corporate project portfolio, but it generally makes more sense to define more than one portfolio on a strategic basis in large organizations to reflect product line, geographic or technological divisions of the organization, industry or market.

A Project Portfolio Steering Group consisting of senior executives as appropriate is responsible for establishing the project portfolio management process and for the decisions that must be made concerning the programs and projects within the project portfolio(s) during the operation of that process.

Figure 3. Schematic of Strategies, Projects, a Program and a Project Portfolio.
Figure 3. Schematic of Strategies, Projects, a Program and a Project Portfolio.

The project portfolio management process consists of the following twelve basic steps:

  1. Define the project portfolios required within the organization.
  2. Define the project categories within each portfolio based on uniform criteria for the entire organization.
  3. Identify and group all projects within categories and programs.
  4. Validate projects with the organization's strategic objectives.
  5. Prioritize projects within programs and portfolios.
  6. Develop the Project Portfolio Master Schedule.
  7. Establish and maintain the key resources data bank.
  8. Allocate available key resources to programs and projects.
  9. Compare financial needs with availability.
  10. Decide how to respond to shortfalls in money or other key resources and approve the list of funded projects.
  11. Plan, authorize and manage each program and project using the Project Management Process and supporting systems and tools.
  12. Periodically re-prioritize, re-allocate resources and re-schedule all programs and projects as required.
Objectives of Modern Project Management  Objectives of Project Management

7. Dye, Lowell D., and Pennypacker, James S. 2000. ñProject Portfolio Managing and Managing Multiple Projects: Two Sides of the Same Coin?î Proceedings of the 2000 PMI Seminars & Symposium. Newtown Square, PA: Project Management Institute. 321.
Home | Issacons | PM Glossary | Papers & Books | Max's Musings
Guest Articles | Contact Info | Top of Page