In this blog post I’m going to discuss Project Management, Program Management, Portfolio Management, and the differences among them. This topic is not very hard to understand but make sure you get it because you may see one, or two questions from this topic in your PMP Certification Exam.
This is one of the most important topics from a PMP Certification exam point of view.
Project and Project Management: As per the PMBOK Guide 4th Edition, “A project is a temporary endeavor undertaken to create a unique product, service or result.” and the project management is the “application of knowledge, skill, tool, and technique to project activities to meet the project requirements.”
Please visit What are the Project and Operation & Difference Between them to read further about the project.
Program: A Program is a group of related projects managed in a coordinated way to get benefits and control not available from managing them individually.
Program Management: Program Management is defined as the centralized coordinated management of a program to achieve the program’s strategic objectives. Here, only inter-related and inter-dependent projects are managed as a group to achieve desired benefits.
Benefits of the Program Management:
- fewer conflicts among projects
- optimal utilization of resources
- resource constraints are minimized
- co-ordination among projects.
Portfolio: Portfolio refers to the group of related or non-related projects, or programs. A portfolio may consist of several non-related projects without having a single program.
For example, two non-related projects will be handled under the Portfolio Management instead of the Program management because in program management only related projects are managed.
Portfolio Management: In Portfolio Management, there is a centralized management, whose job is to identify, prioritize, authorize the projects, or program. This centralized management controls and manages the projects or programs to achieve strategic business objectives.
Portfolio Management sets the priority of the projects or programs in a group. Portfolio Management does not oversee any individual project, or the program.
Benefits of Portfolio Management:
- optimal allocation and utilization of resources
- projects or programs constantly receive support
- fewer conflicts among projects, or programs
- better communication among projects, or programs
- co-ordination among projects, or programs.
Program and Portfolio Management facilitate better communication, and co-ordination among the projects and programs, resulting in enormous benefits in economies of scale and lesser risks.
Project – project manager
Program – program manager
Portfolio – portfolio manager
Project – well defined scope
Program – larger scope
Portfolio – business scope aligned with organization’s strategic goal
Project – timely completion, under budget, and quality of output of the project
Program – degree to which it satisfies the objective it was undertaken
Portfolio – combined performance of its component.