PPM Maturity Model.pmd

CENTER FOR BUSINESS PRACTICES®PM SOLUTIONS’Project PortfolioManagementMaturity ModelJames S. PennypackerEDITOR

PM SOLUTIONS’Project PortfolioManagementMaturity Model

PM SOLUTIONS’Project PortfolioManagementMaturity ModelCenter for Business Practices

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELISBN: 1-929576-17-XHeadquartersCenter for Business Practices410 Township Line RoadHavertown, Pennsylvania 19083 USAtel: 610.853.3679World Wide Webwww.cbponline.comThe publisher offers discounts on this book when ordered in bulkquantities. For mor information, write to Special Sales/ProfessionalMarketing at the headquarters address above.Copyright © 2005 by Center for Business Practices. All Rights Reserved.Neither this book nor any part may be reproduced or transmitted in anyform or by any means, electronic or mechanical, including photocopying,microfilming, and recording, or by any information storage and retrievalsystem, without permission in writing from the publisher.Current printing (last digit):10 9 8 7 6 5 4 3 2 1PRINTED IN THE UNITED STATES OF AMERICA4

ContentsAcknowledgements 7Introduction 9Chapter 1Describing Project Portfolio Management Maturity 13Chapter 2Summary Description of Maturity Levels 35Chapter 3Project Portfolio Management Maturity Model:Organized by Portfolio Management Component 39Chapter 4Project Portfolio Management Maturity Model:Organized by Level of Maturity 59Chapter 5Integrating Project & Portfolio Management 79Appendix AProject Portfolio Management Maturity:A Benchmark of Current Business Practices 91Appendix BProject Portfolio Management Maturity Model Grid 94About the Center for Business Practices 965

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AcknowledgementsThis book is a great example of one of project management’ssignal features: the creative team. As with any product thatdistills the experience and knowledge of many people workingtogether over time, it is a little hard to give all creditwhere it is due. With that said, the following PM Solutionsteam members were instrumental in developing the projectportfolio management maturity model as well as this book.Eric Foss, PMPJames S. PennypackerPatrick Sepate, PMPLarry Sisemore, PMPC.J. Walker, PMPKaren R.J.White, PMPMary Yanocha, ABC7

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IntroductionPROJECT MANAGEMENT SOLUTIONS, INC. (PM Solutions) is amanagement consulting, training, and research firm dedicatedto helping companies optimize business performanceand successfully execute their strategies through projectmanagement improvement initiatives. Since its founding in1996, PM Solutions has distinguished itself by focusing onimproving corporate performance through project staffing/outsourcing, organizational project management maturityassessments, process and methodology development, projectoffice deployment and enhancement, project managementtechnology integration, project portfolio management, valuemeasurement, and corporate training delivered through thePM College ® .Project Management MaturityA cornerstone product of PM Solutions has been its ProjectManagement Maturity Model. 1 This model has contributed towidespread success in assisting organizations in improvingtheir project management processes. The model has been usedto baseline project management practices industry-wide, 2becoming the industry standard in measuring project managementmaturity. PM Solutions’ Project Management Maturity1J. Kent Crawford, Project Management Maturity Model, Marcel Dekker, 2002.2Project Management Maturity Benchmark, Center for Business Practices, 2001.9

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELModel provides your organization with an easily understoodand applied conceptual framework within which specificproject management processes can be optimized to efficientlyimprove the capability of your organization.Project Portfolio Management MaturityIn addition to optimizing project management processes,organizations have found that they improve their overallperformance by optimizing their processes for managing thecomplete portfolio of projects as well. The ultimate goal ofthis book is to help you improve the capability of yourorganization’s project portfolio management processes. Tohelp you achieve this goal, PM Solutions has built its ProjectPortfolio Management Maturity Model applying the sameprinciples of ease of understanding and application. Themodel provides best practices to help you:• determine the maturity of your organization’s projectportfolio management processes• map out a logical path to improve your organization’sprocesses• set priorities for short-term process improvementactions• assess the role of a project office in your project portfoliomanagement processes• track progress against your project portfolio managementimprovement plan• build a culture of project portfolio management excellenceacross the organization.10

INTRODUCTIONBy focusing on specific project portfolio managementrelatedimprovement processes, your organization can bestleverage the resources assigned to improvement activitieswhile rallying the organization around specific goals. Aproject portfolio management maturity model can be aroadmap showing an organization how it can systematicallymove to more mature levels of portfolio management performanceand do it in more effective and efficient ways. Afteran objective assessment, your organization can set its goalsfor increasing the capability of its portfolio managementprocesses as part of an overall project management improvementinitiative.How this Book is OrganizedChapter 1 describes project portfolio management maturitywithin the context of organizational project managementmaturity and offers a brief description of the PM Solutions’Project Portfolio Management Maturity Model. The chapteralso describes the process of assessing your organizationusing this model, and provides best practices for using anassessment.Chapter 2 provides a summary description of the five levelsof project portfolio management maturity.Chapter 3 defines the levels of project portfolio managementmaturity (Level 1 through Level 5) for each of the six projectportfolio management components.Note: Definitions of project portfolio management component maturityare grouped by level. Achievement of a given component level by an11

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELorganization is cumulative—that is, for each succeeding project portfoliomanagement maturity level, the assumption is that all criteria forthe preceding levels are being (or have been) fulfilled. For example, fororganizations to be assessed at Level 3 maturity, all of the processesand practices of Levels 1–2 must be in place, as well as all of theprocesses and practices of Level 3.Chapter 4 also defines the levels of project portfolio managementmaturity but differs from Chapter 3 in that it organizesthe model by levels of maturity rather than by project portfoliomanagement component.Chapter 5 discusses how best practice organizations integrateproject management and project portfolio managementpractices to optimize the executive decision-making process,resource allocation, and day-to-day project execution.Appendix A shows the results of recent research thatbenchmarked the level of project portfolio managementmaturity at more than 50 organizations in a variety ofindustries.Appendix B presents a simple grid of the Project PortfolioManagement Maturity Model for a quick, high-level overview.12

CHAPTER 1Describing Project PortfolioManagement MaturityUNTIL JUST A few years ago, the concept of maturity wasseldom used to describe the state of an organization’s effectivenessat performing certain tasks. Today, we find thismaturity concept being used increasingly to map out logicalways to improve an organization’s services.In organizations where we have done project portfoliomanagement maturity assessments, we have seen that theevolution of project portfolio management typically lagsbehind development of other capabilities within a company.It isn’t until the need for project portfolio managementbecomes critical that organizations pay attention to improvingthe project portfolio management skills within theirorganization. This lack of foresight frequently creates anenvironment where the project portfolio management systemsand infrastructure are not in place to support the needsof the practicing project management community. Eventually,it becomes necessary to start taking a proactive look atthe infrastructure necessary to progress in project portfoliomanagement capability. In short, the need becomes so great13

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELthat the organization must respond to growing businesspressures. Often, this happens when executive managementdecides to take proactive action—but the question is: actionin what direction, and to what end?There are a great number of interrelated challenges todeal with in improving an organization’s project portfoliomanagement discipline: project managers aren’t receivingthe information they need to manage effectively; managementis not receiving accurate forecasts of completion data;there is inconsistent understanding of expectations andbusiness needs, etc. This is often where the value of a maturityassessment comes into play. Any model selected tomeasure project portfolio management maturity must pointout a logical path for progressive development. It may not beso important to know you are a Level 2 organization, butrather what specific actions you will be implementing tomove the organization forward. What is most important isthat the organization has a clear vision of its desired endstate and is moving to improve the capability of projectportfolio management with very targeted efforts. Improvingproject portfolio management is a series of smaller steps, notgiant leaps. Many organizations will not need to realizeLevel 5 in maturity to achieve measurable benefits andresults. Many organizations will achieve significant benefitby reaching the managed process level of maturity (Level 3).In effect, a good model for the measurement of projectportfolio management maturity enables the creation of astrategic plan for moving project portfolio managementforward in an organization.14

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITYProject Portfolio ManagementMaturity ModelEnhancing an organization’s portfolio management capabilitiesis an important piece of its overall project managementmaturity. PM Solutions’ Project Portfolio Management MaturityModel is built around six essential components of portfoliomanagement. The model is patterned after the SoftwareEngineering Institute’s Capability Maturity Model ® Integration(SEI CMMI ® ). It has five distinct levels of maturity and examinesan organization’s implementation across the six projectportfolio management components (see Figure 1.1).Portfolio Management Maturity ModelComponent DescriptionsWe identified six components essential to developing aneffective organizational portfolio management environment:COMPONENT 1Portfolio GovernanceThis component addresses processes that facilitate the governanceof an organization’s project portfolio.Fundamental Areas of Focus• Portfolio governance process• Initial consideration of alignment to the organization’svision, strategy, or objectives supported by basic alignmentcriteria• Portfolio review board operations (policies and procedures)15

PROJECT PORTFOLIO MANAGEMENT MATURITY MODEL• Portfolio review board membership (balance of projectmanagement and business knowledge)• Portfolio review board charting process for establishingdivision-level portfolio review boardsAs the Organization Matures within this Component…Portfolio governance processes, procedures, and decisionmakingevolve as an enterprise portfolio review board isestablished to compliment the division-level portfolio reviewboards. The portfolio is managed against strategic criteria,and balanced to maintain an optimal mix of projects toachieve the organization’s strategies.COMPONENT 2Project Opportunity AssessmentThis component addresses the processes around identifyingand consistently assessing project opportunities.Fundamental Areas of Focus• Project opportunity identification/assessment process• Roles and responsibilities• Business value determination• Portfolio review boardAs the Organization Matures within this Component…Processes such as opportunity identification, business casedevelopment, project approval, post-implementation projectreview and lessons learned are refined and consistentlyapplied across the enterprise. Project portfolio managementprocesses are continually assessed and improved with a16

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITYFigure 1.1. PM Solutions’ Project Portfolio Management Maturity Modelcovers five distinct levels of maturity, similar to those of the SEI CMMI,across six project portfolio management components.particular emphasis on supporting management decisionmakingduring opportunity assessment activities. The portfolioreview board becomes more active in the analysis of cost-17

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELbenefit, schedule, and risk data. Post-implementation reviewsvalidate actual results for comparison to initial dataand the information is used for process improvement efforts.COMPONENT 3Project Prioritization and SelectionThis component addresses processes that facilitate the review,prioritization, and selection of projects in the projectportfolio.Fundamental Areas of Focus• Project prioritization processes and criteria• Selection and funding process• Portfolio review boardAs the Organization Matures within this Component…Prioritization becomes more consistent across the organizationas the processes and criteria become better defined, understood,consistently interpreted, and applied. The portfolioreview board becomes more active in the review and selectionprocess at the division level, evolving to the enterprise level.An established process supports executive decision-makingconcerning new project proposals. Portfolio developmentinformation is collected and maintained, including baselinedata for the portfolio management processes.18

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITYCOMPONENT 4Portfolio and Project Communications ManagementThis component addresses processes that facilitate the collectionand sharing of portfolio information.Fundamental Areas of Focus• List of approved projects (beginning at the division level)• Portfolio information defined (consistent set of data foreach project)• Portfolio information shared across the division• Processes for sharing information• Project management processes• Categorization of projects and balancing of projectinvestment with organizational goalsAs the Organization Matures within this Component…Adherence to corporate project management processes –initially at the division level, then at the enterprise-level –enable the enhancement of the project portfolio list or database.The project list or database covers the entire organizationand portfolio information is available to all divisions fortheir use as they participate in the organization’s projectmanagement and portfolio management processes. Projectinvestment information is readily available.19

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELCOMPONENT 5Portfolio Performance ManagementThis component addresses processes that facilitate the collection,analysis, and management of information used inportfolio performance management processes and decisionmaking.Fundamental Areas of Focus• Portfolio performance management process• Portfolio review with sponsors and other key stakeholders• Portfolio information sharing with sponsors and otherkey stakeholders• Portfolio review boardAs the Organization Matures within this Component…Processes and standards guiding portfolio performancemanagement are institutionalized, portfolio reviews areconducted regularly, and portfolio analysis is conducted toensure the appropriate balance of project investments. Theportfolio review board operates at the enterprise level andprovides project oversight through regular portfolio progressreviews. The enterprise portfolio review board prioritizesprojects using defined criteria. There is an emphasis onmaintaining the performance of a balanced portfolio –monitoring the actual progress and delivery projects againsttheir investment and planned benefit.20

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITYCOMPONENT 6Portfolio Resource ManagementThis component addresses processes that facilitate the assignmentof resources across the organization to support theprojects in the organization’s portfolio.Fundamental Areas of Focus• Resource assignment process• Skills identification at the division-level• Project prioritization and resource assignment acrossthe division (based on skills and availability)• Cross-divisional resource assignment is coordinated tosupport prioritized projectsAs the Organization Matures within this Component…Project prioritization is conducted at the enterprise-level bythe portfolio review board. Portfolio resource managementfunctions are executed with an enterprise perspective.Resource assignment is based upon resource skills,prioritization, and project priorities. Resource pools aremanaged and contain all types of resources. The enterpriseportfolio review board oversees the portfolio to ensure resourcecontinuity across projects.The Portfolio Management Maturity Model examines each ofthese six components independently against the criteria foreach of the five levels of maturity.21

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELLevels of Project Portfolio Management MaturityThe Project Portfolio Management Maturity Model developedby PM Solutions is patterned after the SEI CMMI ® . Thefive levels of the model are described below. Each levelrepresents a discrete organizational capability. The PortfolioManagement Maturity Model examines each level within thesix project portfolio management components.LEVEL 1Initial Process• No processes or only ad hoc processes exist• Portfolio information not readily available• Roles and responsibilities not understood• No project or resource inventoriesLEVEL 2Structured Process and Standards• Basic processes exist• Business value of projects understood• Mix of intermediate and summary-level information• Portfolio reviewed periodically• Simple prioritization scheme established at division-level• Roles and responsibilities defined• Basic project and resource inventories exists22

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITYLEVEL 3Organizational Standards and Institutionalized Process• Organization-wide processes standard• Summary and detailed information available• Enterprise-wide portfolio actively analyzed and monitored• Project strategy aligned with business strategy• Processes integrated with corporate processes• Roles and responsibilities defined, linked to business valueLEVEL 4Managed Process• Post-implementation reviews using quantitative andqualitative data• Repository of portfolio development information established,updated, and maintained• Project portfolio information is audited• Project investment information available on demand• Common objectives and metrics defined for portfoliodecision-making and analysis• Strategic criteria used to maximize portfolio valueLEVEL 5Optimizing Process• Focus on continuous improvement of portfolio managementprocesses23

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELIntegrating Project, Resource, Asset, and ProductPortfoliosWhen you consider that the Project Management Institutedefines a project as “a temporary endeavor undertaken tocreate a unique product, service or result,” 3 it is by definitionunderstood that something new will exist within the organizationat the completion of every project. It is also understoodthat every project consumes resources to create itsproduct, service, or result. In order for those organizations atthe highest levels of organizational maturity to operate asefficiently and effectively as possible, it is important to createa culture of governance that integrates the planning, consumptionand creation of all organizational assets.Those projects that create products, services or resultsadd something new to the product or asset portfolios.Projects focused on enhancing existing products may notcreate additions to the portfolio but may change the attributesof certain products, affecting the overall value of theproduct portfolio. In all cases, however, resources and assetswill be consumed by the projects to create the product of theproject. Strategically planning the consumption of thoseresources enables an organization to do the right projects atthe right time.Managing the resources and assets being consumed byprojects is just as important as managing project outcomes.Mature prioritization processes are key to keeping all thecylinders firing in the right order at the right time. Efficiencyand effectiveness comes from an organization’s ability to3A Guide to the Project Management Body of Knowledge, Third Edition, ProjectManagement Institute, 2004.24

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITYknow what portfolios exist, their relationship to each other,their prioritization schemes and the optimal performance ofall the portfolios to ensure the highest levels of productivityfor the organization.In many, or most, organizational cultures this is a tremendousundertaking and requires a multi-phase approachto achieve. The critical nature of understanding the projectportfolio management maturity of one’s organization establishesthe starting point at which the process maturity programbegins and the development and integration of all theportfolios within the organization.Five Levels of Maturity – Why SEI CMMI ® is Usedas the StandardResearch into why software projects were so often completedlate, over-budget, and failed to deliver what the end userreally wanted resulted in Software Engineering Institute’sCapability Maturity Model ® Integration (SEI CMMI ® ), a wayof measuring an organization’s maturity in those softwareengineering processes generally accepted as crucial to successfulproject completion. This Capability Maturity Model has inturn become a de facto standard for process modeling andassessing an organization’s maturity in several process areas(i.e., personnel management, systems engineering). Since theCMMI ® concept has received such widespread acceptance, itmade sense to develop the PM Solutions’ Project ManagementMaturity Model following the same structure. PM Solutions’Project Portfolio Management Maturity Model leverages thatproven framework.25

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELMeasuring Against the Five LevelsToo often we see the implementation of new tools or techniquesas a panacea that will solve all of our problems.Maturity models can be misapplied the same way. First,there is the possibility of error in the performance of theassessment. Determining the correct level of maturity in anorganization is something less than science but more thanart. There are many factors that go into determining thislevel including individual interviews, as well as evaluatingartifacts, processes, standards, knowledge, and companyculture. So there is a subjective nature to determining thelevel of maturity, although it’s unlikely that a wide margin oferror will occur. It is extremely important to use an assessmenttool that has been tested and proven to achieve consistentand correct results.Additionally, and more importantly, the results of anassessment can be misused. An assessment should really beaimed at providing a path forward for the organization inimproving its project portfolio management capabilities.Typically, organizations start with a baseline assessment oftheir current situation. This is accomplished by performing acomprehensive assessment evaluating all areas where projectportfolio management has an influence. From here, a periodic,abbreviated assessment can indicate where progress isbeing made in the application of project portfolio managementmethodologies. The baseline assessment enables anorganization to identify those areas that will provide thegreatest return on investment and will show where immediateactions will have an impact.26

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITYThere is a great difference between each of the five levels;organizations should strive to fill in the pockets that are weakwhile advancing those that will provide benefit. Striving toincrease the maturity level just for the sake of having a higherlevel is an unwise use of the tool. It is also recommended thatan organization attempt to maintain a close relationship oflevels across the various components. It has been our experiencethat the benefits associated with achieving a Level 5maturity in one component may be erased if the other componentsare all at Level 2 maturity.Maturity AssessmentsConducting the AssessmentSo, what takes place during a maturity assessment? Anythorough assessment has the following four ingredients (at aminimum):• Personal and/or group interviews• Artifact collection and evaluation• Widespread survey input• Benchmark comparison to established standards.There is little substitute for the sense of discipline, understanding,and buy-in that can be obtained from a direct personalinterview with a project portfolio management practitioner.This is a necessary element of an assessment to uncover thedegree to which policy is put into practice. Coupled with thisis the collection of evidence (artifacts) supporting the imple-27

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELmentation of project portfolio management—are all thedocuments required by policy complete, are they of highquality, etc.? Third, are the concepts of project managementand project portfolio management understood and utilized bythe major population that should have knowledge about thepolicies and procedures? What is the general view of theproject portfolio management requirements, etc.? Last, synthesizingthe data and comparing this information against anestablished standard that is logical, sound, and clear to providea path forward is essential. Any assessment that does notconsist of at least these elements may leave an organizationwondering where the benefit lies with the process.Using the Results of an AssessmentThe real value in performing an assessment comes into playacross several areas. Several of these areas are listed in theparagraphs below.Leading ChangeOne of the more difficult and most important aspects ofinstilling consistent and effective project portfolio managementprocesses in an organization is changing the behaviorand habits of the people doing the work. A key element ofleading organizational change is the development and communicationof a vision for portfolio management that complementsand is supported by the organization’s overall projectmanagement vision. The results of a project portfolio managementmaturity assessment provide a clear path and tangibleactions that can be implemented for the company to move28

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITYforward together. By using the assessment information, whichis provided by all levels of the organization, employees aremore likely to feel part of the plan to achieve the vision. At aminimum, clear implementation communications reinforcestheir understanding of where the future for the company lies.Through the assessment process, the work products andprocess that people are using will be evaluated and comparedto best-practice scenarios. Employees have the opportunity toidentify with the logic in the new processes and gain an initialunderstanding of what project portfolio management has tooffer. They begin to realize the need to think and act differentlythan they have in the past – an essential first step in thelong road towards a culture evolution.Organizational Project Management ImprovementThe Project Portfolio Management Maturity Assessment isplanned and executed as an integrated piece of theorganization’s overall project management improvementinitiative. Components addressed during the assessmentimpact and are impacted by other project managementimprovement efforts. Project Portfolio Management MaturityAssessment activities and the resulting improvement effortscontinue to refine aspects of the organization’s projectmanagement environment.Integration with Project Management MaturityThe organization’s project management discipline is thefoundation of project portfolio management. As projectportfolio management processes evolve, they will become29

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELmore demanding of the organization’s project managementprocesses. Without mature project management processes,an organization can achieve only a fraction of the projectportfolio management benefits. Carefully plan for the integrationbetween project management maturity and projectportfolio management maturity. This integration allowsorganizations to select the best portfolio of projects that arealigned with business strategy, monitor their performance,and iteratively re-prioritize the portfolio as business conditionsand budgets change. The achievement of Level 3 inboth project management and project portfolio managementmaturity enables organizations to attain what PM Solutionshas defined as an organization’s Strategy in Action! At theselevels of performance executive management can experiencethe success of defining a corporate vision, seeing thoseconcepts decomposed into strategic and tactical plans andfurther defined into programs and projects that are staffedand managed at the right times by experienced professionalproject managers and executed to completion, on time andon budget. Once completed, the successful project resourcesare immediately reassigned to projects and programs queuedby the portfolio process and defined as the next step inachieving the organization’s strategy.Project Office ImplementationThe assessment can help refine the organization’s answers totwo important questions:• What is the role of the project office in project portfoliomanagement?30

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITY• Is the project office at the appropriate level of theorganization to successfully fill this role?The project office, by definition, is the center of excellence forproject management. Less clear is the level of the organizationat which the project office should exist to successfullyfulfill its organizational purpose with regards to projectportfolio management. Results of the assessment can be fedback into the project office implementation and its evolutionto contribute to a maturing organization.Assessments as a Progress and Effectiveness ToolWe find many of our clients periodically ask themselves: “Arewe making a difference?” or “Are we advancing the projectmanagement capability in the right areas, and in general?”Recurring use of the Project Portfolio Management MaturityAssessment can show the progress that the organization ismaking toward its goals. This can become a part of the metricsthat are used to measure success of a project office on arecurring basis. These periodic assessments ensure improvementsare taking root, reinforcing adoption of new ways.Essentially, repeated assessments can be used to track progressagainst the plan developed during the initial assessment.Target Six-Month Improvement GoalsWe often find that organizations want to use the assessmentas a tool to identify specific areas of improvement that becomegoals for the next incremental period of time. They then tackleone area, one level, at a time. This allows organizations to31

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELshow improvements over a 6–12 month period so that theimprovement sponsors see a solid return on investment. Smallvictories provide an opportunity to cheer for successes andreevaluate specific direction while reenergizing staff members.These are important “peg points” that allow organizations tosee how much they’ve learned, plan for what they didn’tknow in the first planning session, and adapt/adjust directionfor the next short-term (6 months) initiative. Short-termimprovement goals also provide a tool to communicate successesand achieved milestones to executives and management.This reinforces executive awareness of the immediatevalue being realized by the organization as a result of theinitiative. This is an important message to communicate,especially given the fact that commitment to change/improvementinitiative budgets can waiver with time.Setting Your Maturity GoalsIs Level 5 for Everyone?Level 5 maturity is not for everyone. Each organizationneeds to determine the minimum level of maturity at whichthe return on investment is achieved and then determine thereturn on investment associated with achieving the nextlevel. It is important to realize that these levels are evolutionarysteps. We recommend that our clients establish an incrementalimprovement program with specific focus and measurablegoals that allow their organization to realize somebenefits within a short period of time. We recommend sixmonthincrements, whenever possible.32

DESCRIBING PROJECT PORTFOLIO MANAGEMENT MATURITYWe have also found it beneficial to synchronize projectportfolio management maturity with the maturity level ofother corporate processes, including project management,financial management, software engineering, product development,etc.Assessing Your LevelSo, how do you determine where you are currently? There aretwo kinds of assessments that can be conducted – independentand facilitated.Independent AssessmentThe independent assessment uses external assessors. Projectmanagement experts, possessing a strong blend of portfoliomanagement, organizational structure, project management,professional development, and management skills, plus anin-depth understanding of the Project Portfolio ManagementMaturity Model conduct the assessment. Using a prescribedset of tools and processes, these experts would determineyour organization’s maturity levels within each of the componentsidentified in the model. The management team andthe assessors would then work together to develop yourimprovement plan. This independent approach is the preferredmethod, especially when an external “expert voice” isneeded to communicate to senior executives.Facilitated AssessmentDuring a facilitated assessment, a small team of experiencedassessors would team with representatives from your staff toconduct a self-assessment. Following the same procedures33

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELthat an independent assessment would follow, this team ofindividuals would determine your organization’s maturitylevels within each of the components identified in the model.The team would then work with your management staff todevelop an improvement plan to achieve your desiredproject portfolio management maturity level. The primarychallenge in the self-assessment approach is maintaining theconfidentiality of individual findings. The assessment factfindingactivities include staff interviews. The quality of theinformation provided in these interviews can be skewed ifstaff members are not comfortable sharing negative informationwith other staff members. The self-assessment approachcan also suffer from an inherent bias towards a higher levelof maturity; no one likes to hear they are at Level 1 maturity.ConclusionThe benefits of a structured assessment of project portfoliomanagement maturity lie in setting direction, prioritizingactions, and beginning cultural change rather than in understandingthe current level at which an organization is performing.The emphasis is on “structured.” It is importantthat the assessment itself be repeatable, provide consistentmeasurements and results, and provide for some degree ofbenchmarking with other organizations. This provides thebasis for any assessment to be utilized as a “checkup” tool tomeasure progress, and to identify the next logical stepsforward. Most importantly, the assessment must be anintegral part of the organization’s project managementimprovement initiative.34