These are very important topics from a PMP exam point of view and you are going to see some questions on these topics in your exam; therefore, make sure you understand these topics well.
Okay, let’s get started.
According to the PMBOK Guide 5th edition, “A project is a temporary endeavor undertaken to create a unique product, service or result.”
So, you can say that a project is temporary in nature, i.e. once the project achieves its objective its existence comes to an end, and the objective of a project is to create a unique product, or develop a system to provide you any service, or is the result of any task.
For example, let’s say that you have been given a project to set up a call center for a company that they can use to provide service to their customers. You start the project, set up the call centre, and hand it over to your client. Now your client is ready to provide support service to their clients.
It is not necessary for your team members to be located in one place; sometimes your project team may include members located outside your geographic location.
Please note that once you hand over the end product to the client, your project will be completed and you will close the project. Moreover, since the nature of the project is temporary, your project team members will be separated once the project is completed.
Project management is the process that helps projects achieve their objectives. These processes include initiating the project, developing the plan to execute the project, executing the project according to the approved plan, controlling the project activities throughout its lifetime, and finally handing over the output of the project to the client, and closing the project.
Simply put, project management is the application of knowledge, skills, tools, and techniques to project activities to meet the project requirements.
Visit ‘Project and Operation’ to read more about the project and operations.
A program is a group of related or similar projects managed in a coordinated way to get the benefits and control not available from managing them individually. This means that in a program you will have multiple projects which are either similar or related to each other.
For example, let’s say that you have two projects: the first project is to construct a school building and the second project is to construct an office building. Since these two projects are similar in nature, you will keep them under a program.
Program management is defined as the centralized coordinated management of a program to achieve its strategic objectives. In program management, you only manage the interrelated or interdependent projects as a group to achieve the desired result.
The objective of program management is to optimize the utilization of resources among projects and reduce the friction or constraints so as to increase the organization’s performance.
The Difference between Project Management and Program Management
The following are a few differences between project management and program management:
- In project management, you manage one individual project while in program management you manage multiple similar or related projects.
- A project can be a part of a program but a program cannot be a part of a project.
- Program management addresses the management of project management. It helps you set the project management processes and measure the project results.
The Benefits of Program Management
The following are a few benefits of program management:
- Less conflict among projects
- Optimal utilization of resources
- Resource constraints are minimized
- Better communication and coordination among projects
- Improves organization’s performance
Portfolio refers to a group of related or non-related projects or programs. A portfolio can consist of multiple programs or multiple projects without having a single program. A portfolio can have multiple non-similar projects without having a program, because two or more non-related projects will be managed under portfolio management. Conversely, in program management only related projects are managed.
For example, let’s say that you have three projects: the first project is to construct a building, the second project is to conduct research to find the impact of motor pollution on the environment, and the third project is to set up a call center.
How you are going to manage these projects?
You will manage these projects by keeping them under a portfolio, because all three projects are neither related nor similar to each other.
Portfolio management has a bigger scope and objective than program management.
In portfolio management, there is a centralized management whose job is to identify, prioritize, and authorize the projects or programs. This centralized management controls and manages the projects or programs to achieve the organization’s strategic business objectives.
Please note that, although portfolio management sets the priority of the projects or programs in a group, it does not oversee any individual project or program.
The Difference between Portfolio Management and Program Management
The following are a few differences between portfolio management and program management:
- In program management, you manage similar projects, while in portfolio management you manage non-similar projects or different programs.
- The scope for program management is larger than the project scope, and the portfolio has an organization-wide scope which changes with the strategic objectives of the organization.
The Benefits of Portfolio Management
The following are a few benefits of portfolio management:
- Optimal allocation and utilization of resources among projects or programs
- Provide constant support to projects or programs
- Fewer conflicts and better communication among projects or programs
- Better coordination among projects or programs
As you move from project management towards portfolio management, scope and objective will become larger and larger. In project management, you perform micro management, and in portfolio management high-level macro management is required. Program management and portfolio management facilitate better communication and coordination among projects and programs, resulting in enormous benefits in economies of scale and lesser risks.
The person responsible for projects is the project manager, for programs it is the program manager and for portfolios it is the portfolio manager. The success criteria are different for projects, programs, and portfolios. For projects, it is a timely completion, under budget, and the quality of output of the project; for programs, it is the degree to which it satisfies the objective it was undertaken; and for portfolios it is the combined performance of its components.
If you have any questions, you can do so through the comments section.